2. Simulation is imitation of some real thing or a process.
The act of simulating something generally involves representation of
certain key characteristics or behavior of a selected system.
3. Simulation is the process of designing a model of a real system
and conducting experiments with this model for the purpose of
understanding the behavior for the operation of the system.
4. Simulation techniques can be used to assist management decision-making, where
analytical methods are either not available or inappropriate.
A simulation model is a mathematical model that calculates the impact of
uncertain inputs and decisions we make on outcomess that we care about, such as
profit and Loss, investment returns, etc.
A simulation model will include:
Model inputs that are uncertain numbers/ uncertain variabless
Intermediate calculations as required
Model outputs that depend on the inputs – These are uncertain functions
5. Identify the problem :
The simulation process is used to solve a problem only when the assumptions
required for analytical models are not satisfied.
Identify the decision variables and decide the performance:
The inventory control situation, the demand, lead time and safety stock are
identified as decision variables and measure the performance.
Construct a simulation model :
For developing a simulation model, an intimate understanding of the relationships
among the elements of the system being required.
6. Testing and validating the model :
Any simulation model must represent the system under study. This requires comparing
a model with actual system validation process.
Designing of the experiment :
It refers to controlling the conditions of the study, such as the variables to include. In
this situations where observations are taken but the conditions of the study are not
controlled.
Run the simulation model :
The computer to get the results in the form of operating characteristics.
Evaluating the result :
The simulation process is complete, then select the best course of action, otherwise make
desired changes in model decisions variables.
7. Time dependent and time independent simulation :
In time dependent simulation know the precise time when the event is likely to occur,
but incase of time independent simulation it is not important to know the time when the
event is occur.
Corporate and financial simulations :
The corporate and financial simulation is used in corporate
planning, especially the financial aspects. The models integrate
production, finance, marketing, and other functions.
Visual interactive simulation :
It uses computer graphic displays to present the consequences of change in
the value of input variations in the model.
8. It is useful for sensitivity analysis of complex systems.
It is suitable to analyze large and complex problems that cannot be solved by the
usual quantitative methods.
It is the remaining tool when all other techniques become intractable or fail.
It can be used as a pre-service test to try out new policies and decision rules for
operating a system.
9. Sometimes simulation models are expensive and take a long time to develop.
The simulation model does not produce answers by itself.
It is the trial and error approach that produces different solutions in repeated
runs
It does not generate optimal solutions to the problems.