S-MATH311LA BSM31 1st Sem ( 2021-2022 ) - 1st Sem AY2021-202... https://dlsud.edu20.org/student_lesson/show/2795121?lesson_id=130...

S-MATH311LA BSM31 1st Sem ( 2021-2022 ) - 1st Sem AY2021-2022

Introduction to Management Science

Quantitative Analysis Process

Immersive Reader

Qualitative vs. Quantitative analysis

Qualitative analysis is based primarily on the manager’s judgment
and experience; it includes the manager’s intuitive “feel” for the
problem and is more an art than a science.
Quantitative analysis will concentrate on the quantitative facts or
data associated with the problem and develop models or
mathematical expressions that describe the objectives,
constraints, and other relationships that exist in the problem
Please see references below to know more about qualitative vs
quantitative analysis.
Quantitative Analysis Process
• Model Development (creating a model as representation of
the problem situation)
• Data Preparation (gathering of information needed for the
model)
• Model Solution (evaluating all alternatives and identifying all
feasible solutions)
• Report Generation (creating a recommendation based on the
analysis)
Model Development
Models are representations of real objects or situations.
Three forms of models are:

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Iconic models - physical replicas (scalar representations) of real

objects.
For example, a scalar model of a building is a representation of
the real building.

Analog models - physical in form, but do not physically resemble

the object being modeled.
For example, the speedometer of an automobile is an analog
model because the position of the needle on the dial represent
the speed of the automobile.

Mathematical models - represent real world problems through a

system of mathematical formulas and expressions based on key
assumptions, estimates, or statistical analyses.
For example, the use of numbers, symbols and mathematical
operation to represent the constrained optimization problem.

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Advantages of Models
Generally, experimenting with models (compared to
experimenting with the real situation):
• requires less time
• is less expensive
• involves less risk

Data Preparation
Another step in the quantitative analysis of a problem is the
preparation of the data required by the model. Data in this sense
refer to the values of the uncontrollable inputs to the model.
Uncontrollable inputs are model data inputs that you either can’t
control or are unwilling to control (because of cost, company
politics, etc.). Example of these uncontrollable inputs maybe profit
per unit, labor-hours per unit, labor-hours capacity, etc. All
uncontrollable inputs or data must be specified before we can
analyze the model and recommend a decision or solution for the
problem.
Model Solution

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Once the model development and data preparation steps are

completed, we proceed to the model solution step. In this step,
the analyst attempts to identify the values of the decision
variables that provide the “best” output for the model. The
specific decision-variable value or values providing the “best”
output are referred to as the optimal solution for the model. For
the production problem, the model solution step involves finding
the value of the production quantity decision variable x that
maximizes profit while not causing a violation of the production
capacity constraint.
Report Generation
An important part of the quantitative analysis process is the
preparation of managerial reports based on the model’s solution.
As indicated in the "Decision Making Process" in the previous
section, the solution based on the quantitative analysis of a
problem is one of the inputs the manager considers before
making a final decision. Thus, the results of the model must
appear in a managerial report that can be easily understood by
the decision maker. The report includes the recommended
decision and other pertinent information about the results that
may be useful to the decision maker.
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