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1. UNIT-1
INTRODUCTION TO OPERATIONS
RESEARCH

2. INTRODUCTION TO OR
OPERATIONS RESEARCH (O.R.)
DEFINITION:
•Operations research (O.R.) is the art of winning war without actually fighting
it.
•O.R. is a scientific approach to problem solving for executive management
- H.M. Wagner
•O.R. is a tool which is concerned with the design and operations of man,
machine system scientifically, usually under conditions requiring the optimum
allocation of limited resources. –Operations Research Society of America
(ORSA)
•O.R. is the application of the scientific methods to complex problems arising
in the direction and management of large system of men, machines, material
and money in industry, business and government.

3. INTRODUCTION TO OR
ORIGIN & DEVELOPMENT OF O.R.
The origin and development of operations Research can be studied
under the following classifications.
1) Pre-world war – II Development
2) Developments During world war – II
3) Post world war Development
4) Computer Era.
5) Inclusion of Uncertainty Models.
1) PRE-WORLD WAR – II DEVELOPMENT
Many of the techniques of today O.R. have been actually developed
and used even before the term O.R. was introduced. Some of the techniques are
Example: Inventory control, Queuing Theory, Statistical Quality Control
(S.Q.C.) etc.

4. INTRODUCTION TO OR
In 1915, Ford Haris developed a simple Economic order Quantity (E.O.Q.)
model to optimise the total cost of Inventory system, which was eventually analysed
in 1934 by R. H. Wilson. Around the same time (1916), A. K. Erlang, a Danish
telephone engineer, was responsible for many of early theoretical developments in the
area of queuing theory.
In the early 1900’s outline quantity checks conducted by inspectors were not
found to be satisfactory for some companies. The problem was analysed in the
inspection engineering department of Western Electric’s Bell Laboratory by
‘Schwartz’ who ultimately designed control charts in 1924. These are called as 1st
Schwartz control charts. During the period 1925-26, the Western Electric Company
defined various terminologies associated with the acceptance sampling of quality that
was used as a tool for controlling attributes of raw materials or components or
finished products.
In 1925, Dodge introduced the basic concept of sampling inspection 10
years later; Pearson’s developed the British standard Institution Number 600. In 1939
H. Roming presented his work on variable sampling plan in his PH.D dissertation.

5. INTRODUCTION TO OR
2) DEVELOPMENT DURING WORLD WAR-II
During the world war – II, the effective utilization of scare resources
was top-most concern of the military in Britain. So, in, Britain Scientists for
different fields were jointly directed to do research on military operations for
improving the effectiveness with the limited resources. Later on, this scientific
& inter – disciplinary approach become an important problem solving aspect of
O.R. methodologies.
3) POST WORLD WAR – II DEVELOPMENTS
After the world war – II, the industries in American & Britain
concentrated in applying the O.R. methodologies to industrial problems for
maximising the probability with limited resources.
In 1947, Danzig, developed simplex method to solve L.P.P There after
the Operations Research society of America, and Institute of Management
science were found in 1952 & 1953 respectively.

6. INTRODUCTION TO OR
4) COMPUTER ERA
Many of the O.R. techniques involve complex computations and hence
they take longer time for providing solutions to real life problems. The
development of high speed digital computers made it possible to successfully
apply some of the O.R. techniques to large size problems.
5) INCLUSION OF UN-CERTAINTY MODELS
The use of the probability theory and statistics to tackle un-
deterministic solutions made the O.R. techniques realistic.
CHARACTERISTICS (OR) FEATURES OF O.R
The main characteristics of O.R. are as follws.
1) Inter – Disciplinary Team Approach:
In O.R., the optimum solution is found by a team of scientists selected
from various disciplines are such as Mathematics, Statistics, Economics,
Engineering, Physics etc.
Example: For a organization may include a statistician, an electrician, a
mathematician or more engineers, a psychologist, and some supporting staff
like computer programmers etc.

7. INTRODUCTION TO OR
2) Holistic Approach to the system:
The most of the problem tackled by O.R. tries to find out the best or
optimum decisions relative to large possible portion of the total organization.
The nature of the organization is essentially immaterial.
3) Imperfectness of Solutions:
By O.R. techniques, we cannot obtain perfect answers to our problems
but only the quality of the solution is improved form worse to bad answers.
4) Use of scientific Research:
O.R. uses techniques of scientific research to reach the optimum
solution.
5) To optimize the Total output:
O.R. tries to optimize total return by maximising the profit and
minimising the cost or loss.

8. INTRODUCTION TO OR
APPLICATIONS OR SCOPE OF O.R.
O.R. is concerned with the application of scientific methods and
techniques to decision making problems from management science to
design optimization.
1) Business and Industry:
O.R. techniques are used to solve several managerial decision
making problems such as inventory, resource allocation problems,
queuing problems, problems relating to replacement of men, machines,
sequencing and scheduling problems, competitive problems, search
problems etc.
2) Small Business Organizations:
O.R. tools used to minimise cost or maximize profit whenever a
departmental store faces the problems like employing additional sales
girls, purchasing an additional van etc.

9. INTRODUCTION TO OR
3) Agriculture:
There is considerable scope to solve the problems that arise in
agriculture like problem of optimal distribution of water from known sources
like canal irrigation , problem of optimum allocation of land for various
suitable crops in accordance with climate conditions and available facilities.
4) National Planning:
National planning can be improved if an optimum coordination arrived
through cerntral planning agency by resorting to O.R. techniques.
5) Finance:
O.R. techniques are used to solve problems such as
a) Fore-casting on cash management and capital budgeting.
b) Long range corporate objectives of an institution.
c) Credit policies, credit risks etc.

10. INTRODUCTION TO OR
6) Health Care:
O.R. tools may be used to solve problems such as
a) Hospital management and its multi – phased activities.
b) Proper allocation of resources to serve the patients etc.
7) Information Technology:
Network flow programming’s are now-a-days helpful in solving
numerous problems occurs in different field of research.
8) Marketing:
a) Production selection, timing & competitive actions.
b) Advertising media with respect to cost and time.
C) Effectiveness of market research.
9) Research and Development:
a) Reliability and evaluation of alternative designs.
b) Control of development projects.

11. INTRODUCTION TO OR
PHASES OF O.R:
PHASE – I FORMULATING THE PROBLEM:
Before proceeding to find out the solution of a problem, 1st
of all
one must be able to formulate the problem in the form of an appropriate
model. To do so, the following information will be required.
i) What has to be decision?
ii) What are the objectives?
iii) What are the ranges of controlled variables?
iv) What are the uncontrolled variables that may affect the possible
solutions?
v) What are the restrictions or constraints on the variables?
Since wrong formulation cannot yield a right decision, one must
be considerably careful while execution this phase.

12. INTRODUCTION TO OR