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M1 Intro

Management science is a scientific approach to decision-making in business that utilizes quantitative tools to solve management problems and achieve optimal solutions. The quantitative analysis approach involves defining problems, developing mathematical models, gathering data, and implementing findings. However, its major limitation is the inability to accurately predict outcomes involving behavioral elements and the neglect of non-quantifiable factors.

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12 views19 pages

M1 Intro

Management science is a scientific approach to decision-making in business that utilizes quantitative tools to solve management problems and achieve optimal solutions. The quantitative analysis approach involves defining problems, developing mathematical models, gathering data, and implementing findings. However, its major limitation is the inability to accurately predict outcomes involving behavioral elements and the neglect of non-quantifiable factors.

Uploaded by

ninosanchebuche
Copyright
© All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PDF, TXT or read online on Scribd

Management Science

• Define management science and understand applications of management


science in business situations
Management Science
Management
◦ Planning
◦ Coordinating
◦ Directing
◦ Controlling

Function: decision-making
Based on: reliable quantitative information – a rational and
scientific approach
Management Science
Scientific approach used to determine management problems and
make economic decisions using quantitative tools to achieve
optimum solutions.
• Decision science
• Operations research
• Quantitative analysis
• Optimization technique
• Solve management problems
• Use quantitative tools to find solutions to problems
• Decision based on quantitative information and analysis
• Employs quantitative analysis approach in finding optimal solution
Quantitative Analysis Approach
1. Defining management problem
2. Develop a mathematical model
3. Gathering quantitative data
4. Finding the optimal solution
5. Checking results
6. Analyze and evaluate findings
7. Implement findings
Quantitative Analysis Approach
Defining management problem
Concern:
improve profitability level
reduce costs
Number of units delivered

Quantitative data
Weather condition

Qualitative data
Unit cost of a product

Quantitative data
Behavior of customer

Qualitative data
Reward system of a company

Qualitative data
Transportation costs

Quantitative data
Quantitative Analysis Approach
Developing mathematical Model
Model – representation of an event, relationship, situation, or reality

Physical model (ex. Representation of condominium)


Scale model (geometrically similar to an object, smaller than the original)
Schematic model (diagram, picture, drawing)
Mathematical model (variables, parameters)
Quantitative Analysis Approach
Gathering quantitative data
• accuracy (correctness, preciseness)
• reliability (consistency of a measure, whether the results can be
reproduced under the same conditions)

• Some drawbacks: data – not readily available


Quantitative Analysis Approach
Finding optimal solution
Involve a series of repeated processes/procedures
Checking the Results
Reviewing accuracy and completeness of data
Quantitative Analysis Approach
Analyze and evaluate findings
• breaking the quantitative approach into several parts
• making judgments based on standard/criterion – Proceed? Not?
Implement findings
Quantitative findings deem to be beneficial – implement
Management Science
Its major limitation is its inability to accurately predict business
phenomena that contain behavioral elements.
It ignores the importance of people, relationships, and other non-
quantifiable factors.

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