Untitled Flashcards Set

Management Science

A scientific approach to solving management problems using quantitative analysis and mathematical modeling to support decision-making.

Problem Solving

The systematic process of identifying differences between current and desired states and resolving them using logical methods.

Scientific Method

A structured process involving observation, problem definition, model construction, solution, and implementation to solve management problems.

Observation

The first step of the scientific method; identifying problems in the organization through ongoing monitoring.

Problem Definition

The second step; clearly and precisely stating the problem and organizational objectives to guide model development.

Model Construction

The third step; developing a mathematical or abstract representation of the problem using variables, parameters, and functional relationships.

Model Solution

The fourth step; solving the constructed model using suitable mathematical techniques to find values for decision variables.

Implementation

The final step in the process; applying the model’s solution in the organization. Often overlooked, but critical for impact.

Feedback Loop

A concept indicating that failure in implementation may require re-evaluation, bringing the process back to earlier stages.

Decision Variable

A symbol used in a model to represent a controllable input, the value of which is determined during optimization.

Objective Function

A formula representing the goal of the model, such as maximizing profit or minimizing cost.

Constraint

An equation or inequality in a mathematical model that imposes restrictions on decision variables.

Variable

A symbol representing a quantity that can change or assume different values in a model.

Parameter

A known constant value in a model, often serving as coefficients for variables, derived from data.

Functional Relationship

A mathematical connection between variables, where one variable is dependent on another.

Mathematical Model

A representation of a real problem using equations and numerical relationships among variables and parameters.

Profit

The difference between total revenue and total cost.

Break-even Analysis

A technique used to determine the point at which total revenue equals total cost, resulting in zero profit.

Break-even Point

The volume where total revenue equals total cost; helps determine how many units must be sold to avoid loss.

Fixed Cost

Costs that remain unchanged regardless of production levels.

Variable Cost

Costs that vary depending on the level of production or activity.

Cost-Volume-Profit (CVP) Analysis

An analytical model examining the relationship between cost, volume, and profit.

Sensitivity Analysis

A technique used to assess how sensitive a model's outcomes are to changes in parameters or input values.

Risk

The probability and consequences of negative outcomes associated with uncertain events.

Uncertainty

The lack of certainty about future outcomes or events; not all variables are known.

Spreadsheet

A digital tool used for modeling, data manipulation, and sensitivity or break-even analysis.

Excel QM

An Excel add-in used for solving management science problems like break-even analysis, volume analysis, and graphical modeling.

Linear Programming

A mathematical technique for optimization where relationships are linear; used to achieve an objective under constraints.

Integer Programming

A linear programming method where some or all decision variables must be integers.

Total Integer Model

A model in which all decision variables must be integers; used when fractional solutions are not acceptable.

0–1 Integer Model

A model using binary decision variables, typically for yes/no decisions.

Mixed Integer Model

A model that includes both integer and continuous variables.

Goal Programming

A variation of linear programming that handles multiple objectives by prioritizing goals.

Simplex Method

An algorithm used to solve linear programming problems efficiently.

Transportation Method

A technique used to minimize cost in distributing goods from sources to destinations.

Assignment Method

Used to assign resources/tasks on a one-to-one basis to optimize outcomes.

Branch and Bound Method

A method used for solving integer and combinatorial optimization problems.

Network Techniques

Techniques using visual diagrams to model systems (e.g., shortest path, project scheduling).

Decision Analysis

A probabilistic method of evaluating decision alternatives under uncertain future conditions.

Queuing Theory

A method used to analyze waiting lines or queues to improve service efficiency.

Project Management (CPM/PERT)

Tools used for planning, scheduling, and controlling projects using network diagrams.

Analytical Hierarchy Process (AHP)

A structured decision-making technique using pairwise comparisons in a hierarchy.

Simulation

A technique that imitates real-world systems to analyze behavior under different scenarios.

Forecasting

Predicting future demand or trends based on historical data to improve planning and reduce costs.

Non-linear Programming

Optimization where relationships between variables are not linear.

Game Theory

A method for analyzing competitive scenarios where outcomes depend on strategies of multiple players.

Markov Analysis

A probabilistic method used to model state transitions over time in a system.

Decision Support System (DSS)

A computer-based tool that aids decision-makers by integrating data, models, and a user interface.

Data-Oriented DSS

A DSS focusing on data collection and analysis to support decisions.

Model-Oriented DSS

A DSS emphasizing analytical models and mathematical techniques for decision-making.

Online Analytical Processing (OLAP)

A type of DSS focused on complex, multidimensional data analysis for business decisions.

Western Clothing Company Example

Used to illustrate break-even analysis using Excel QM by modeling cost, revenue, and profit.

Project Management

The process of planning, organizing, and controlling resources to achieve specific goals within a defined time frame.

CPM (Critical Path Method)

A project analysis technique using deterministic time estimates with activities shown as nodes.

PERT (Program Evaluation and Review Technique)

A project analysis method using probabilistic time estimates, with activities shown as arrows between nodes.

Project Objectives

A clear description of what a project aims to accomplish, including the time frame, cost, and expected outcomes.

Project Scope

The boundaries of a project, detailing what is included and what constitutes project success.

Contract Requirements

Managerial, reporting, and performance obligations defined for staff, suppliers, and subcontractors.

Gantt Chart

A bar chart displaying project activities against time, used for simple project scheduling and tracking.

Risk and Problem Analysis

The identification of potential delays or failures and plans to address them.

Return on Investment (ROI)

A metric used to evaluate project gain relative to cost.

Soft Return

Intangible project benefits like employee satisfaction or public image improvement.

Project Team

A temporary group of individuals with diverse skills organized to execute a project.

Project Manager

The individual responsible for coordinating project activities and ensuring timely completion within budget.

Scope Statement

A document outlining project justification, goals, deliverables, and success criteria.

Statement of Work (SOW)

A detailed work description for team members or subcontractors specifying duties and deliverables.