Lecture 1 – Operations Research. Topics What is OR? Modeling and the problem solving process Deterministic vs. stochastic models OR techniques Using the Excel add-ins to find solutions Solving real problems. What is Operations Research?. Operations
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J. Bard and J. W. Barnes
Operations Research Models and Methods
Copyright 2004 - All rights reserved
The activities carried out in an organization.
The process of observation and testing characterized
by the scientific method. Situation, problem statement, model construction, validation, experimentation, candidate solutions.
An abstract representation of reality. Mathematical, physical, narrative, set of rules in computer program.
Include broad implications of decisions for the organization at each stage in analysis. Both quantitative and qualitative factors are considered.
A solution to the model that optimizes (maximizes or minimizes) some measure of merit over all feasible solutions.
A group of individuals bringing various skills and viewpoints to a problem.
Operations Research Techniques
A collection of general mathematical models, analytical procedures, and algorithms.
OR professionals aim to provide rational bases for decision making by seeking to understand and structure complex situations and to use this understanding to predict system behavior and improve system performance.
Much of this work is done using analytical and numerical techniques to develop and manipulate mathematical and computer models of organizational systems composed of people, machines, and procedures.
Goal: solve a problem
Example: Internal nursing staff not happy with their schedules; hospital using too many external nurses.
ModelConstructing a Model
Example: Define relationships between individual nurse assignments and preference violations; define tradeoffs between the use of internal and external nursing resources.
ToolsSolving the Mathematical Model
Example: Read nurse profiles and demand requirements, apply algorithm, post-processes results to get monthly schedules.
Example: Implement nurse scheduling system in one unit at a time. Integrate with existing HR and T&A systems. Provide training sessions during the workday.
Deterministic Models Stochastic Models
• Linear Programming • Discrete-Time Markov Chains
• Network Optimization • Continuous-Time Markov Chains
• Integer Programming • Queueing
• Nonlinear Programming • Decision Analysis
Deterministic models – 60% of course
Stochastic (or probabilistic) models – 40% of course
assume all data are known with certainty
explicitly represent uncertain data via
random variables or stochastic processes.
Deterministic models involve optimization
characterize / estimate system performance.