Basics of Operational Research PDF

SAKSHAM: IL6 WEBINAR for Logistics “Basics of Operations Research” 1 INTRODUCTION TO OPERATIONAL RESEARCH Operational Research is a systematic and analytical approach to decision making and problem solving. O.R. as termed in USA, Canada, Africa, Aus...

SAKSHAM: IL6 WEBINAR for Logistics “Basics of Operations Research” 1 INTRODUCTION TO OPERATIONAL RESEARCH Operational Research is a systematic and analytical approach to decision making and problem solving. O.R. as termed in USA, Canada, Africa, Australia and Operational Research as termed in Europe, is an Branch of applied mathematics that uses techniques and statistics to arrive at Optimal solutions to solve complex problems. It is typically concerned with determining the maximum profit, sale, output, crops yield and efficiency and minimum losses, risks, cost, and time of some objective function. It have also become an important part of INDUSTRIAL ENGINEERING PROFESSION. Some of the PRIMARY TOOLS used by operation researchers are : STATISTICS GAME THEORY PROBABILITY THEORY, etc. 2  HISTORY OF OPERATIONAL RESEARCH There is no clear history that marks the birth of O.R., it is generally accepted that the field originated in England during the World War II. Some say that Charles Babbage (1791-1871) is the Father of O.R because his research into the cost of transportation and sorting of mail led to England’s University Penny Post in 1840. Modern Operations Research originated at the Bowdsey Research Station in U.K. in 1937 to analyze and improve the working of the UK’s Early Warning Rador System. During the Second World War about 1000 Men and Women were engaged to work for British Army. After World War II, Military Operational Research in U.K. became Operational Analysis (OA) within the U.K. Ministry of Defence with expanded techniques and graving awareness. 3 OPERATIONAL RESEARCH IN INDIA The Operational Research Society of India was founded in 1957 to provide a forum for the Operational Research Scientists as well as an avenue to widen their horizon by exchange of knowledge and application of techniques from outside the country. The Society is affiliated to the International Federation of Operational Research Societies (IFORS). The Headquarters of the Society is located in Kolkata at 39, Mahanirvan Road, Kolkata 700029, India. At present the Society has 12 Operating Chapters located in Agra, Ahmedabad, Ajmer, Bangalore, Chennai, Delhi, Durgapur, Jamshedpur, Kolkata, Madurai, Mumbai and Tirupati. The Objectives of the Society comprise advancement of, conducting of research in, study of, promotion and propagation of knowledge in Operational Research and Allied Techniques through exchange of information, as well as establishment, improvement and maintenance of professional and academic standards of work known as Operational Research. Contribution to the Society towards attainment of these objectives is eligible for exemption of income tax under Section 80(G)(5)(vi) of the Income Tax Act 1961. The Society Publishes a quarterly journal OPSEARCH, which brings out high quality and state of the art papers in Operational Research. In order to provide opportunity to professionals and students to equip themselves with the knowledge and usage of the science of Operational Research, the Society is conducting an examination on Graduate Diploma in Operational Research since 1973. 4 DEFINITION OF OPERATIONAL RESEARCH ❖It is an Act of winning wars without actually fighting. -Aurther Clark ❖It is a Scientific Approach to problem solving for executive management. -H.M. Wagner ❖It is Art of giving bad answers to problem which otherwise have worse answers. -T.L. Saaty 5 FEATURES OF OPERATIONAL RESEARCH ❖Decision-Making ❖Scientific Approach ❖Inter-Disciplinary Team Approach ❖System Approach ❖Use of Computers ❖Objectives ❖Human Factors 6  DECISION MAKING Every industrial organization faces multifaced problems to identify best possible solution to their problems. OR aims to help the executives to obtain optimal solution with the use of OR techniques. It also helps the decision maker to improve his creative and judicious capabilities, analyse and understand the problem situation leading to better control, better co- ordination, better systems and finally better decisions. SCIENTIFIC APPROACH : OR applies scientific methods, techniques and tools for the purpose of analysis and solution of the complex problems. In this approach there is no place for guesswork and the person bias of the decision maker. 7  INTER-DISCIPLINARY TEAM APPROACH Basically the industrial problems are of complex nature and therefore require a team effort to handle it. This team comprises of scientist, mathematician and technocrats. Who jointly use the OR tools to obtain a optimal solution of the problem. They tries to analyze the cause-and-effect relationship between various parameters of the problem and evaluates the outcome of various alternative strategies. SYSTEM APPROACH The main aim of the system approach is to trace out all significant and indirect effects for each proposal on all sub-system on a system and to evaluate each action in terms of effects for the system as a whole. The inter-relationship and interaction of each sub-system can be handled with the help of mathematical/analytical models of OR to obtain acceptable solution. 8  USE OF COMPUTERS The models of OR need lot of computation and therefore, the use of computers becomes necessary. With the use of computers it is possible to handle complex problems requiring large amount of calculations. The objective of the operations research models is to attempt and to locate Best or Optimal Solution. OBJECTIVE : Operational Research always try to find the best and optimal solution to the problem. For this purpose objectives of the organisation are defined and analysed. These objectives are then used as the basis to compare the alternative courses of action. 9 HUMAN FACTORS : In deriving, Quantitative Solutions we do not consider human factors, which doubtlessly play a great role in the problems. So, study of O.R. is incomplete without study of human factors. SCOPE OF OPERATIONAL RESEARCH : The scope of OR is not only confined to any specific agency like defence services but today it is widely used in all industrial organisations. It can be used to find the best solution to any problem be it simple or complex. It is useful in every field of human activities.Thus, it attempts to resolve the conflicts of interest among the components of organization in a way that is best for the organisation as a whole. The main fields where OR is extensively used are given in next slide. 10 FIELDS : ❖National Planning and Budgeting ❖Defence Services ❖Industrial Establishment and Private Sector Units ❖R & D and Engineering 11  NATIONAL PLANNING AND BUDGETING OR is used for the Preparation of- ❖Five Year Plans ❖Annual Budgets ❖Forecasting of Income and Expenditure ❖Scheduling of Major Projects of National Importance ❖Estimation of GNP ❖GDP ❖Population ❖Employment and Generation of Agriculture Yields, etc. 12 DEFENCE SERVICES : Basically formulation of OR started from USA Army, so it has wide application in the areas such as: ❖Development of New Technology ❖Optimization of Cost and Time ❖Tender Evaluation ❖Setting and Layouts of Defence Projects ❖Assessment of “Threat Analysis” ❖Strategy of Battle ❖Effective Maintenance and Replacement of Equipment ❖Inventory Control, ❖Transportation ❖Supply Depots, etc. 13  INDUSTRIAL ESTABLISHMENTS AND PRIVATE SECTOR UNITS OR can be effectively used in- ❖Plant Location and Setting Finance Planning ❖Product and Process Planning ❖Facility Planning and Construction ❖Production Planning and Control ❖Purchasing ❖Maintenance Management ❖Personnel Management, etc. 14  R&D AND ENGINEERING Research and development being the heart of technological growth, OR has wide scope and can be applied in- ❖Technology Forecasting and Evaluation, ❖Technology and Project Management, ❖Preparation of Tender and Negotiation, ❖Value Engineering, ❖Work/Method Study and so on. 15 METHODOLOGIES/APPROACHES OF OPERATIONAL RESEARCH 1. ORIENTATION F 2. PROBLEM DEFINITION E 3. DATA COLLECTION E 4. MODEL FORMULATION D 5. SOLUTION B 6. ANALYSES AND INFORMATION A 7. IMPLEMENTATION AND C MONITORING K 16 TECHNIQUES/TOOLS OF OPERATIONAL RESEARCH ❖Linear Programming ❖Queuing Theory ❖Sequencing ❖Transportation Problems ❖Integer Problems ❖Assignment Problems ❖Decision Theory and Games Theory ❖Replacement Problems ❖Symbolic Logic 17 LINEAR PROGRAMMING This technique is used to find a solution for optimising a given objective. Objective may be maximizing profits or minimizing costs. Objective function and Boundary conditions are linear in nature. LPP techniques solve Product-Mix and Distribution problems of enterprise. Its also used to allocate Scarce Resources in optimum manner in problems of scheduling, product mix, etc. QUEUING THEORY This theory deals with the situations in which queue is formed, e.g. customers waiting for services, machines waiting for repairmen, and aircrafts waiting for landing strips, etc. If the Queue will be long the cost will be high due to long waiting hour. This technique is used to analyse the feasibility of adding facilities and to access the amount and cost of waiting time. This calculations can then be used to determine the desirable number of service facilities. 18  SEQUENCING Models have been developed to find a sequence for Processing Jobs so that the total elapsed time for all the jobs will be minimum. The models also help to resolve the conflict between the objectives of maximizing machines utilization and complying with predetermined delivering rates. TRANSPORTATION PROBLEMS : Transportation problems deals with transportation of a product From a number of sources With limited supplies To number of destinations With specified demands At the total transportation cost. The main objective of transportation is to Schedule Shipment from sources to destinations in such a way so as to Minimize the Total Transportation Cost. 19  TIME AND MONEY COST When basic data are subjected to frequent changes, incorporating them into the OR models is a costly proposition. Moreover, a fairly good solution at present may be, More desirable than a perfect OR solution available after sometime. The computational time increases depending upon the size of the problem and accuracy of results desired. IMPLEMENTATION : Implementation of any decision is a delicate task. It must take into account the complexities of human relations and behavior. Sometimes, resistance is offered due to psychological factors which may not have any bearing on the problem as well as its solution. 20  Thank You Presenter’s Name :Priyendu N Giri Contact : 7077762551