Showing papers in "Management Science in 1955"
TL;DR: It will be shown how the methods of linear programming may be used to obtain estimates of parameters when more usual methods, such as “least squares,” are difficult or impossible to apply.
Abstract: Linear programming, as an optimizing method for handling a mass of interacting variables, has received considerable attention in applications to such problems as production scheduling, logistics, and mobilization studies. But linear programming may also be used in a variety of other ways. This paper is concerned with one such alternative use. It will be shown how, by appropriate adaptations, the methods of linear programming may be used to obtain estimates of parameters when more usual methods, such as “least squares,” are difficult or impossible to apply.
1,058 citations
TL;DR: In spite of the high level of interest in inventory control that has sprung up recently among statisticians, economists, and businessmen, very little has been written that indicates the fundamental connection between price theory and inventory control.
Abstract: In spite of the high level of interest in inventory control that has sprung up recently among statisticians, economists, and businessmen, very little has been written that indicates the fundamental connection between price theory and inventory control. Most of the inventory control systems now in operation assume a given price structure. The analysis is frequently restricted to cost minimization. Economic theorists, on the other hand,~have concerned themselves with profit maximization but have not ordinarily concerned themselves with the realistic details underlying the construction of their curves. Only in the event that other variables external to the cost minimization problem are assigned optimal values will the cost minimization problem be equivalent to profit maximization.
704 citations
TL;DR: The first step has been to study a particularly simple form of organization which the Office of Naval Research, and especially its Logistics Branch, has encouraged, which is a team.
Abstract: Recent attempts to analyze organization problems in a scientific manner were stimulated by the classical economic theory of the firm Walrus, Marshall and by the newer theories of statistical decision functions Neymann, Wald, the theory of games von Neumann and Morgenstern, and the theory of communications Wiener, Shannon. The Office of Naval Research, and especially its Logistics Branch, has encouraged this development. The task is big and can be carried out only step by step. The first step has been to study a particularly simple form of organization which we call a team.
402 citations
TL;DR: In this article, a research team has been developing new methods to enable production executives to make better decisions and to make them more easily than they can with prevailing procedures, and the new methods have been developed in the context of a set of concrete production scheduling problems that were found in a factory operated by the company.
Abstract: The decision problems involved in setting the aggregate production rate of a factory and setting the size of its work force are frequently both complex and difficult. The quality of these decisions can be of great importance to the profitability of an individual company, and when viewed on a national scale these decisions have a significant influence on the efficiency of the economy as a whole. This paper reports some of the findings of a research team that has been developing new methods to enable production executives to make better decisions and to make them more easily than they can with prevailing procedures. With the cooperation of a manufacturing concern, the new methods have been developed in the context of a set of concrete production scheduling problems that were found in a factory operated by the company. The new method which is presented in this paper, involves: (1) formalizing and quantifying the decision problem (using a quadratic approximation to the criterion function) and (2), calculating...
396 citations
TL;DR: This design provides a situation stripped of the complexities of large-scale social groups but retaining some essential characteristics of the organizational communication problem, and can examine how the communication net affects simultaneously the development of the organization's internal structure, and the group's performance of its operating task.
Abstract: Bavelas, Smith and Leavitt Bavelas, A. 1950. Communication patterns in task-oriented groups. J. Acoustical Soc. Amer.22 725--730. have posed the problem: what effect do communication patterns have upon the operation of groups? To study this problem they designed a laboratory situation that is a prototype of those occurring in “natural” organizations existing in government and business. Each member of the group is given certain information. Their task is to assemble this information, use it to make a decision, and then issue orders based on the decision. This design provides a situation stripped of the complexities of large-scale social groups but retaining some essential characteristics of the organizational communication problem. In it we can examine how the communication net affects simultaneously a the development of the organization's internal structure, and b the group's performance of its operating task.
303 citations
TL;DR: In this paper, the authors present an axiomatization of the notion of utility differences and establish the expected representation theorem guaranteeing measurement unique up to a linear transformation, which is similar to the one in this paper.
Abstract: In the literature of economics the notion of utility differences has been much discussed in connection with the theory of measurement of utility. However, to the best of our knowledge, no adequate axiomatization for this difference notion has yet been given at a level of generality and precision comparable to the von Neumann and Morgenstern construction of a probabilistic scheme for measuring utility. The early study of Wiener is not axiomatically oriented. The purpose of this paper is to present an axiomatization of this notion and to establish the expected representation theorem guaranteeing measurement unique up to a linear transformation.
143 citations
TL;DR: In this article, the authors discuss a number of functional equations which arise in the optimal inventory problem, which is a particular case of the general problem of ordering in the face of an uncertain future demand.
Abstract: The purpose of this paper is to discuss a number of functional equations which arise in the “optimal inventory” problem. This is a particular case of the general problem of ordering in the face of an uncertain future demand. Actually, an important aspect of the problem is that of determining a suitable criterion of cost, one which is both realistic and analytically malleable.
142 citations
TL;DR: In this article, the authors propose to look at management science from the point of view of the Manager, and their focus is on determining what methodology, what tools and techniques the Manager needs to do an orderly and systematic job of managing.
Abstract: Most of the writing on the new “Management Science,” that is on the application of systematic methodology to the job of managing in the business enterprise, has so far come from the scientists. Understandably it has therefore focused on the finding of areas in business to which the scientist can apply tools and techniques with which he is already familiar, and on the sharpening and development of these tools. The all but universal approach has been: here is a scientific method, here are scientific tools and techniques; let us find applications for them in the business enterprise.
This paper proposes to look at “Management Science” from the point of view of the Manager. Its focus will therefore be on determining what methodology, what tools and techniques the Manager needs to do an orderly and systematic job of managing.
Concretely the focus will be on the specific process through which the Manager does his work, and on the specific object to which his work is directed; one focus will be on Decision Making, one on the Business Enterprise and its structure.
And the aim of this paper is to develop, albeit in rough and sketchy form, some specifications for “Management Science.”
55 citations
TL;DR: In this article, it was shown that linear graphs are in a one-to-one correspondence with certain square matrices whose only elements are 0 and 1, and these corresponding matrices have been used as a mathematical model by others.
Abstract: Linear graphs have been utilized by several authors to provide a geometric depiction of the structure of a group. Graphs will be defined in the next section where it will also be shown that they are in a one-to-one correspondence with certain square matrices whose only elements are 0 and 1. These corresponding matrices have been used as a mathematical model by others. Both viewpoints are combined here to provide a systematic procedure for identifying the liaison persons in an organization.
42 citations
TL;DR: This article is divided into four parts and contains a heuristic introduction to the basic problem, a mathematical statement of Markowitz's theory of portfolio selection and its basic assumptions, and a summarization and critique of the theory, its limitations, and its possibilities as a guide to practical decision-making.
Abstract: The purpose of this paper is to analyze and explain, by reference to empirical data, some of the recent work done in this area by Dr. Harry Markowitz under the sponsorship of the Cowles Commission Cowles Commission Discussion Papers in Economics Nos. 294, 2005, and 2019. Also, “Portfolio Selection,” Journal of Finance, March 1952.. This article is divided into four parts. Part I contains a heuristic introduction to the basic problem together with a mathematical statement of Markowitz's theory of portfolio selection and its basic assumptions. Part II contains a discussion of some of the problems involved in formulating probability beliefs for available investment opportunities. In Part III, the selection technique is demonstrated by application to a very simplified case, and many of the problems involved in more complex cases are brought out. The final section contains a summarization and critique of the theory, its limitations, and its possibilities as a guide to practical decision-making.
40 citations
TL;DR: In this survey of areas of application of game theory some problems which have been completely formulated, solved, and are of immediate practical value have been discussed in Sections 4 and 5, but for those interested in the deeper and more important long-range problems which confront the researcher in the behavioral sciences, Section 6 indicates where some of the work of yesterday has taken place and where much of theWork of tomorrow must lie.
Abstract: Since the war, there has been a great growth in interest in the theory of organization. The size of many modern organizations has brought to the surface problems of communication and decision-making of a very different nature to those confronted by smaller groups. A large organization appears to be both quantitatively and qualitatively different from a small one. Information flows and decisions that could be comfortably handled by one “jack-of-all-trades” executive in a small organization or in a dictatorial system, where wastage may be no problem, must be broken down and handled by many specialists. In many cases they may never reach the one-man decision level but are finally acted upon by groups. The need to understand these vital processes of decision-making has impelled us to lay emphasis upon the gathering and study of information, the evaluation of goals, and the role of the individual decision-maker. The new methods of game theory appear to provide an important approach to many of the problems of d...
TL;DR: It will be suggested that while much attention has been given to the tactical decision problem, the methods typically employed to solve the strategic problem are frequently less than satisfactory.
Abstract: It is the purpose of this paper to suggest that inventory control operations involve two distinct types of problems which may be identified as tactical decision problems and strategic decision problems. The difference between these two types of problems will be discussed in more detail below. For the moment it is sufficient to observe that a solution to the tactical problem defines a family of decision rules while a solution to the strategic problem involves a final selection of some particular member of this family. It will be suggested, further, that while much attention has been given to the tactical decision problem, the methods typically employed to solve the strategic problem are frequently less than satisfactory. Finally, an alternative approach to strategic decisions on inventory control operations will be outlined. This alternative approach will be illustrated through two specific examples taken from recent experience.
TL;DR: A journal not only serves as a basis of communication for its time, but also as a monument of effort for some future age as mentioned in this paper, and the singularity of the title Management Science dedicates us to the proposition that science of human administration is a real possibility.
Abstract: These remarks are concerned with the policies of the journal of the Institute. A journal not only serves as a basis of communication for its time, but also as a monument of effort for some future age. The singularity of the title Management Science dedicates us to the proposition that a science of human administration is a real possibility. Whatever sort of monument our journal may be for the future, its keystone will consist in this conviction.
TL;DR: A system of equations is developed which relates to a given shipping schedule the schedule of requirements for each assembly, or subassembly, and this analysis is extended to include the time dependence of parts requirements.
Abstract: In a previous paper The Use of Mathematics in Production and Inventory Control---I, Theory of Parts Listing. Paper published in Management Science, vol. 1, no. 1, October 1954. We refer to this report as I., the problem of parts requirements was analyzed with the aid of matrix equations. In the present paper, this analysis is extended to include the time dependence of parts requirements. A system of equations is developed which relates to a given shipping schedule the schedule of requirements for each assembly, or subassembly.
TL;DR: The success of any industrial enterprise is obviously dependent upon the effectiveness of its managerial organization and its supervisory personnel as mentioned in this paper. And these managerial differences may be the single most important competitive difference.
Abstract: The success of any industrial enterprise is obviously dependent upon the effectiveness of its managerial organization and its supervisory personnel. There are differences in management in different industries and even within the same industry in a single country. And these managerial differences may be the single most important competitive difference. But, the differences may be even greater and more significant when comparisons are made on a cross-national basis. In Europe, for example, the concept of the function of management is quite different from that in the United States, as are the variances in the avenues of access to managerial positions.
IBM1
TL;DR: A general description of the nature of a computing or data processing machine is described followed by illustrations of how it is that computers can speed the processing of information.
Abstract: First, there will be a general description of the nature of a computing or data processing machine followed by illustrations of how it is that computers can speed the processing of information. Section II discusses the character of scientific method in order to form a basis for the ideas to be described under Sections III, IV, and V. Section III considers linear equations, with examples being given of their application to management problems. Section IV involves the notion of simulation, together with examples of how this idea can be used in management. Section V includes the design of experiments particularly with respect to obtaining better statistics for use in simulation.
TL;DR: The theory of human decision-making behavior has been studied by many researchers, including economists, game theorists, cyberneticians, information theorists, operations researchers and many others among the management scientists as mentioned in this paper.
Abstract: Economists and psychologists are interested in the theory of human decision making behavior. So are neurophysiologists and psychoanalysts. So also are statisticians, game theorists, cyberneticians, information theorists, operations researchers and many others among the management scientists.
TL;DR: My assignment is to discuss mathematics in the management science of tomorrow in order to discuss possible repercussions of a developing science of management on mathematics as well as possibly repercussions of mathematical developments for the science ofmanagement.
Abstract: My assignment is to discuss mathematics in the management science of tomorrow. The preceding talks have dealt with potential uses by management of emerging and possible scientific developments. In approaching my assignment I would like to shift the emphasis slightly in order to discuss possible repercussions of a developing science of management on mathematics as well as possible repercussions of mathematical developments for the science of management.
TL;DR: My topic in this panel discussion on management science today is the status of research on mathematical solution of programming problems, as in machine loading, or to optimal scheduling of one kind or another.
Abstract: My topic in this panel discussion on management science today is the status of research on mathematical solution of programming problems. The word “programming” refers here to optimal allocation, as in machine loading, or to optimal scheduling of one kind or another. “Optimal allocation” may be taken as referring to static problems, while “optimal scheduling” refers to dynamic problems, varying over time. The static and dynamic problems are, at the present stage of management science development, generally speaking, studied by means of the same techniques.
TL;DR: In this article, the authors outline a forecast of the future of management and management science, namely that through scientific research management is going to become increasingly automatic, based on a survey and projection of some contemporary technological and scientific developments.
Abstract: These remarks are intended to outline a forecast of the future of management and management science, namely that through scientific research management is going to become increasingly automatic. This forecast is based on a survey and projection of some contemporary technological and scientific developments.
TL;DR: Presidential address about the background leading to TIMS formation and the role of management sciences in the formation of TIMS.
Abstract: Presidential address about the background leading to TIMS formation. Delivered before the first national meeting of the Institute of Management Sciences, Oct. 21--22, 1954. Parts of the address are omitted.
TL;DR: In the management science of tomorrow, I predict, there will be a great growth of these and other techniques whereby practitioners and scientists will inform, stimulate and influence each other.
Abstract: In the management science of tomorrow, I predict, there will be a great growth of these and other techniques whereby practitioners and scientists will inform, stimulate and influence each other. One of the most fruitful functions of this new Institute, in my opinion, would be to put some of its intellect and energy into developing such techniques. One of the most important management sciences of tomorrow could well be the science that joins management science and management.