operations research (OR)



Application of mathematical (quantitative) techniques to decision making. In OR, a problem is first clearly defined and represented (modeled) as a set of mathematical equations. It is then subjected to rigorous computer analysis to yield a solution (or a better solution) which is tested and re-tested against real-life situations until an optimum solution is found. OR applies different approaches to different types of problems: dynamic programming, linear programming, and critical path method are used in handling complex information in allocation of resources, inventory control, and in determining economic reorder quantity; forecasting and simulation techniques such as Monte Carlo method are used in situations of high uncertainty such as market trends, next period's sales revenue, and traffic patterns. Also called decision science, management science, or operational research.

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