The use of computer modelling and the simulation of business processes as a means of coming up with improvements in the way that things are done within an organisation

At the heart of operations research (OR) is the use of computer modelling and the simulation of business processes as a means of coming up with improvements in the way that things are done within an organisation. The tasks that OR examines are complex and involve many variables. They include things like designing an optimal telecommunications network in a situation where future demand is uncertain, or automating a paper-based bank clearing system.

According to the Operational Research Society:

Operational Research (OR), also known as Operations Research or Management Science (OR/MS), looks at an organisation's operations and uses mathematical or computer models, or other analytical approaches, to find better ways of doing them.

The term “operational research” is generally used in the UK; the United States favours “operations research” or “management science”. Information technology is central to the skill of an operational researcher. But OR also draws on mathematics, engineering, physics and economics.

The heyday of OR was the 1950s and 1960s when, as Russell Ackoff, an OR academic, once put it, “use of quantitative methods became an ‘idea in good currency'”. By the 1990s, though, Ackoff found that OR had been pushed into “the bowels of the organisation not the head. When it could no longer be pushed down, it was pushed out”. This, he believed, was because OR had been “equated by managers to mathematical masturbation and to the absence of any substantive knowledge or understanding of organisations, institutions or their management”. Ackoff also claimed that there was a more fundamental flaw to OR. It is, he said, designed to “prepare perfectly for an imperfectly predicted future”, and it “helps us little and may harm us much”.

Igor Ansoff, author of the classic “Corporate Strategy”, was heavily influenced by the time he spent working on sophisticated operational research for the Rand Foundation in the early 1950s. Among other things, he analysed the extent of the exposure of NATO air forces to enemy attack.

OR was given a big boost by the second world war when researchers applied the principles of physics and engineering to military operations. After the war, military personnel took these practices with them to civvy street, and to the companies that they then went to work for. OR was often the entry point for engineers, like Ansoff, to come into general management. Many management gurus, including Frederick Taylor, W. Edwards Deming (the founder of the quality movement), Henry Mintzberg and Bruce Henderson (the man behind the experience curve), were trained first as engineers.

Further reading

Ackoff, R.L., “Redesigning the Future: A Systems Approach to Societal Problems”, John Wiley & Sons, 1974

Kirby, M., “Operational Research in War and Peace: The British Experience from the 1930s to 1970”, Imperial College Press, 2003

Taha, H.A., “Operations Research: an Introduction”, 8th edn, Prentice Hall, 2007

Journal of the Operational Research Society

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