Technology

OPERATIONS RESEARCH TURNS COMPLEXITY INTO CAPITAL

What is Operations Research?

Operations Research (OR) is a form of applied mathematics. Using quantitative calculation models, engineers, management scientists and IT experts solve complex problems.

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This is why scientists often use the term “Decision support” to explain this mathematical method. The ultimate aim is to filter out the best solution from an unmanageably large number of potential alternatives.

OR is a scientific instrument designed to provide answers to problems that are hard to grasp. A typical example of these is the so-called “Salesman problem”. When planning the shortest route between the 15 largest cities in Germany, a salesman has more than 43 billion possible routes to choose from.

In practice, even just planning the optimum route to one individual destination can be problematic as the number of alternatives to choose from is large where longer distances are concerned. Navigation systems do a lot of our choosing for us nowadays. To make this possible, the route planners use algorithms that are also used in OR. In other words, navigation systems are instruments used for a specific purpose whose calculation models for choosing the best routes are based on OR.

What can Operations Research do for my company?

The manufacturing industry and service providers are using OR methods more and more frequently. The first cases of application were registered back in the 1930s. Not until now, however, has the extreme increase in computer power made it possible for small and medium-sized companies to profit from OR alongside large companies and institutions.

OR has a wide and varied range of applications. Logistics companies use it to refine their route and capacity planning and avoid empty trips. The operators of mobile communications networks use it to compute the optimum positioning of their transmitting and receiving antennas. And woodworking companies use it to reduce cutting scrap.

In other words, successful Operations Research projects save money and increase profits. For example, Mercedes Benz used an Optimization project from ORCONOMY to reduce delivery costs in its central logistics warehouse.