Operational

Research
An Introduction
Dr Anshuli Trivedi
I st year P.G.
NSCB Medical College Jabalpur
Operational Research is…….

“ Scientific means of providing manager i.e.

executive department the data & tools they need
to analyze & continuously improve the services
they offer. i.e.. Application of scientific
methods, techniques & tools to operations of
system with optimum solution of problems”.

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Ref-J kishore dictionary of public health.

 History of O.R
 Term coined by Mc Closky & Trefthan.
Began in World War II to analyze position of
Radars by Royal Air force.
India I st few countries to start OR & established
Ist OR Regional Research Lab in Hyderabad in
1949.
OR society had been established in 1955 –
publishes OPSEARCH Journal.
It is used in Military, management ,industrial etc.
establishments.
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 Terminology in OR.
Operations-The activities carried out in an organization related to
attaining its goals and objectives.
Research-The process of observation and testing characterized
by the scientific method.
Organization-The society in which the problem arises or for which
the solution is important.
Decision maker-An individual or group in the organization capable
of proposing and implementing necessary actions.
Criterion-It is a method by which results can be evaluated.
Analyst- An individual called upon to aid the decision maker in the
problem solving process.
Team-A group of individuals bringing various skills and viewpoints
to a problem.
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Ref-IGNOU School of Management Studies.
 Model-An abstract representation of reality. A representation of a problem
related to the operations of the organization.

SYSTEMS APPROACH-An approach to analysis that attempts to ascertain &

include the broad implications of decisions for the organization.Both quantitative
& qualitative factors are included in the analysis.

OPTIMAL SOLUTION-A solution to the model that optimizes (maximizes or

minimizes) some objective measure of merit over all feasible solutions - the best
solution amongst all alternatives given the organizational, physical &
technological constraints.

Optimization-Achieving max or min. value for effectiveness criterion.

Suboptimatization-Some criterion subordinate to over all criterion,& is only

Optimized of all possible alternative solution.
Ref-IGNOU School of Management Studies.

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Operational research engages three classical
aspects of science-

a) Describing behavior of the system.

b) Analyzing this behavior by constructing appropriate
models.
c) Using this model to predict future behavior. i.e. the
effects that will be produced by changes in the
systems or in the methods of operations.
Ref-IGNOU School of Management Studies.

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 Phases & Processes of O.R. Study.

Step I-Observe the Problem Environment.


Step II-Analyze & define the Problem.

Step III-Develop a model

Step IV-Select appropriate Data input.

Step V-Provide a solution & test the reasonableness.

Step VI-Implement the Solution.
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 Means of OR
 Network Analysis.

Network Scheduling- Programme Evaluation & Review Technique (PERT).
 Critical Path Analysis.
 Linear & Nonlinear Programming.
 Integral Programming.
 Dynamic Programming.
 Inventory Control Model.
 Stochastic Programming.
 Combinational Optimization.
 Discrete & Continuous time Markovic chains.
 Computer Simulation Procedure.
 Costs Analysis.

Ref-J kishore dict ionary of public health

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Methods in nutshell……
Net work flow analysis -The term network flow program describes a
type of model that is a special case of the more general linear
program. The class of network flow programs includes such
problems as the transportation problem, the assignment problem,
the shortest path problem, the maximum cost flow problem, the
pure minimum cost flow problem, and the generalized minimum cost
flow problem.

Network Scheduling -Technique used to plan, schedule & monitor

large projects. To reduce bottlenecks , trouble shooting- like dealing
with delays, interruptions etc. Includes diagrammatic presentation of
whole project.
It is used to identify critical path & activities. Includes-
1)Critical path Analysis.
2)Programme Evaluation & Review Technique.

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 Critical Path Analysis

• Abb. CPM, or critical path method , is a mathematically based

algorithm for scheduling a set of project activities.
• The essential technique for using CPM is to construct a model of the
project that includes the following:-

• A list of all activities required to complete the project

• The time (duration) that each activity will take to completion,&
dependencies between the activities.

• The results allow managers to prioritize activities for the effective

management of project completion, and to shorten the planned critical
path of a project by pruning critical path activities, by "fast tracking"
(i.e., performing more activities in parallel), and/or by "crashing the
critical path" (i.e., shortening the durations of critical path activities by
adding resources).
• Hence allows identification of shortest possible path to complete the
project.
• Useful when the time for completion is known for certainty.

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Programme Evaluation & Review Technique-
PERT is a method to analyze the involved tasks, in completing a given
project, especially the time needed to complete each task, and
identifying the minimum time needed to complete the total project.

It is used when in activities, exact time required for a task to be

completed is not known surely.

It is able to incorporate uncertainty by making it possible to schedule a

project while not knowing precisely the details and durations of all the
activities.

It is more of an event-oriented technique rather than start- and

completion-oriented, and is used more in R&D-type projects where time,
rather than cost, is the major factor.

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Linear Programming-Constrained optimization technique which tries to optimize
some criterion. It measures effectiveness like profit, loss of return on
investment. It derives more exact solution.

Non linear Programming- Method used when either objective function some
constraints are nonlinear. Ex-discounts on prices of purchases of large
quantities & graduated IT. used to determine approx. area in which solution
lies.

Integer Programming-Technique to ensure only best numerical values of

variables. Ex-no. of trucks in fleet i.e. taking into accounts of only countable
items to solve the problems.

Dynamic Programming-Method to a method to analyze “multistage decision”

process, in which final decision depends on preceding & external factors.
Reduces computational efforts required in analyses.
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Inventory Control Models- Approach to prepare a mathematical-model,
used to express total inventory cost in terms of demands, size of order,
possible over or under stocking & other relevant factors & to determine
optimal order size.-Used by Production managers, purchase managers.

Stochastic Programming –Used when attributes of a system randomly

change over time. Examples include the number of customers in a
checkout line, congestion on a highway, the number of items in a
warehouse, the price of a financial security.

Combinational Optimization-The most general type of optimization problem

and one that is applicable to most spreadsheet models is the combinatorial
optimization problem. Many spreadsheet models contain Combinational
optimization provides tools for automating the search for good solutions
and can be of great value for spreadsheet applications.

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 Continuous Time Markov Chain (CTMC)- Here we consider a continuous
time stochastic process in which the duration of all state ,changing
activities are exponentially distributed. Time is a continuous parameter.

Discrete Time Markov Chain (DTMC)-When assuming this matrix is

unchanging with time & reviewed at regular interval.

Simulation Procedure.-When a situation is affected by large no. of

random variables it is often difficult to obtain closed form of equations that
can be used for evaluation.
Simulation is a very general technique for estimating statistical measures
of complex systems. A system is modeled as if the random variables
were known.
Then values for the variables are drawn randomly from their known
probability distributions. Each replication gives one observation of the
system response.

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Costs Analysis-Comparison of various approaches in terms of costs
• It includes various types of Analysis-

• Cost Effectiveness analysis -Analysis in which costs are related to single

common effect but may differ in magnitude between alternate programme.
Results are compared in terms of costs /unit of effect. Measured in natural
units. Ex-Days fee from morbidity.

• Cost Benefit Analysis -Analysis of costs & consequences only in terms of

monitory outcomes.

• Cost Utility Analysis -Analysis that measures costs in terms of utilities as

measure of value of effect of Expressed in terms of costs of healthy
years, QALY.

• Cost minimization Analysis -Efficiency analysis for two approach only in

terms of cost & search for least expensive approach.

• Text from Basic course in Health Economics CMC Vellore.

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Few theories in use-

Game Theory- Technique for the decision making in situation of conflict.

When there are two or more opponents.

Information Theory-Theory to evaluate the effectiveness of the information

flow within the system. It aids in improving information or
communication flow.

Waiting list Theory-Deals with situation in which queues are formed.

Ex-customers waiting for services. Analyses taking into consideration
costs for waiting & services provided.

Sequencing Theory -Similar to WT but rescheduling of services or

sequencing the costs are done to minimize costs.

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 Typical Applications of O.R

1) Accounting- Cash Flow Planning.

2) Credit Policy Analysis.
3) Planning of delinquent account strategy.
4) Finance.
5) Manufacturing.
6) Marketing
7) Organizational behavior.
8) Purchasing.
9) Research & Development.
10)Facilities Planning.
11) Construction
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Relation between OR specialist &
Manager

1)Complex problem involving variables & relationship.

2)When manager think he cannot solve problem on
his own.
3)When problem is repetitive so as to prevent
recurring costs of finding solution.
4)When problem is numerical.
5)Previous solutions by OR technique were useful.
6)Better understanding of alternate solutions.
7)Holistic solutions are made available.

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Current Focus of OR.
Out come research in clinical management.


Behavioral research to ensure community compliance.



Alternative techniques for monitoring & evaluating programmes.



Programme integration with related public health activities.



Programme impact on health system.



Economic evaluation of elimination & T/T programmes.



12/07/21 J Rosenhead1 The London School of Economics and Political Science, Houghton Street, London, WC2A 2AE, England
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Goals of OR in Department of Health
Delivery of Primary Health Care in new ways.Ex-Helplines.


Reduce waiting times in hospital for T/T.



Deal with risks. Ex. Epidemics.



Assess the population in need of Social Care.




Use of screening programme to screen disease Ex. Ca Cx to
improve public health.

Make arrangements for increased finding for health & social
care & how money should be utilized between different areas.
Forecast mentally ill people in need for health & social care.


Task force to deal with risks & emergencies. Ex. Natural



Disasters.
J. Rosenhead1
12/07/21 The London School of Economics and Political Science, Houghton Street, London, WC2A 2AE, England
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Thanks.
Have a nice day.

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