Operations Research
Operations Research in the Chemical Industry
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HERE has undoubtedly been a good deal of confusion about operations research and a somewhat unfortunate amount of ballyhoo. There has also been a solid and significant advance in management research through operations research activities for the best work in operations research is a natural and important step for7vard in the development of management science: I t s forerunners were all those philosophers and scientists of the pxst who worried about what management is and hoK it should operate. I t s more immediate forerunners were Taylorites, industrial engineers, statistical quality control engineers, and management consultants. What is this solid and significant step that operations research has made in the history of management research? Three things that have happened because of operations research can be given as examples. They could have happened-probably did happen in some instances-under other names. But they have all happened since Korld War 11, and because they are recent they deserve careful study on the part of industrial management. First of all, there is the richer and more complicated use of mathematics in the study of management problems. This step forxard has attracted most attention, and though important enough, it is really not the essence of operations research. T h e use of mathematics is common t o all sciences t o some degree. Rut previously its use in management research has been a t a very elementar)- level. This statement is substantiated by the fact that business administration students are rarely required t o take the calculus, and never required, I am sure, t o take matrix algebra. >-et matrix algebra happens to be a very powerful and useful tool for studying a whole host of typical management problems, as the accompanying article by Symonds (p. 394) illustrates. Few management students in the past have been trained in prohahilitj- theory. But many inanagenient problems involving repetitive decisions-e.g., inventory, pricing, scheduling-can be phrased most fruitfully within a prohability theory framen-orli. K e have learned how to apply higher mathematics t o some important management problems. I n the next 5 t o 10 years n-e will learn how to use mathematics on a wider level. All this amounts t o saying that management \vi11 need t o use technically trained scientists to study management problems. Mathematics alone never solves problems, and the ballyhoo about operations research has mainly been designed t o make the innocent believe that a differential equation is the ansn-er to all their daily headaches. But higher mathematics can enahle us to think in more complicated ways, and thinking is, after all, a part of problem solving. I t should also be pointed out that the use of higher mathematics may enable one to become complicatedly stupid-more stupid in a far worse way than simpler forms of analysis allon-and this occasionally gives rise to illegitimate attacks on mathematics. The second step that operations research has made is also being made by many management consultants. It consists in bettering the engineering aspect of management research by taking a very careful and thorough look a t the organization and the manner in which changes can be made in the organization. It surprises no one familiar with industrial operations t o learn that the “best“ suggestions for running a n organization are never adopted. Poor communication, suspicion, disloyalties, jealousies, all combine to interfere rvith the reasonable. T h e paradox is t h a t not even, nay, least of all, the “boss” can make the change. T h e trouble is not that people are stupid but that a plan which ignores the organization and the people in it is not the best plan a t all. You can’t say, “Here is what should be done t o make the most amount of money, assuming everyone does as he ought to.”
March 1956
This is like saying, “Here is the best way to build the Golden Gate Bridge, assuming no breezes blow.” T h e personal variables can’t be separated from the impersonal ones. The successful operations research studies have opened up new ways of studying management problems from the point of view of those who will act on the results and the organization in which they act. Finally, and in my opinion most important, operations research has brought into management thinking xvhat every scientist knows-that the study of a problem is not primarily for the sake of removing this or that trouble, but rather for the sake of knowing what t o study and do next. Problem solving for management in the past has centered around the “case.” K h a t should management decide to do with this situation a t this time? A very important, question, true. But managements today don’t plan their capital expenditures for this year and t h i j situation only. Neither should they spend their research effort for this problem a t this time only. I see ahead of us a sequence of steps in the development of management research. Right now Tve are finding out how t o set proper inventories, narehousing, transportation facilities, sales promotional effort, etc., assuming that the present product mix policy is correct, that the present lnhor policy is correct, that the finance policy is correct, and EO on. T h a t is, rre are studying a whole class of management problems under certain specific restrictions (assumptions concerning the correctness of broader policies). This is how science aln-nys operateswithin the “closed system.” But it operates this way for the sake of opening up neiT issues. We study in order to study more deeply. We can’t feasibly study broad problems of finance until we have a clewer picture as to how the compa,ny operates in Ppecific areas. Or, in other contests, rye may see that the socalled broader problem needs to be t a c k l d in order to study the specific one. I n either case research lieconies planned, and one does not leap from study to stud These steps in the progress o management research are important ones. I n many cases they \vi11 not be apparent, because much of operations research is like much of the rest of science and engineering-coninionplace or downright bad. 3Iuch of the progress hap been and will be carried out. under some other name because operations research has staked no claims on areas of progress. But there is a fresh breeze coming in, and the alert will leave their houses in order to breathe it, [For an excellent bibliography on OR, see 17. Riley in “Operations Research for Xlanagement” (J. F. McCloskey and F. S . Trefethen, editors), Johns Hopkins Press, Baltimore, 1954.1 The application of operations research has become quite extensive-the chemical industry is one of it,s largest users. There are t-ivo neiv national organizations each publishing a quarterly journal and holding meetings: T h e Operations Reeearch Society of .Inierica ( J . Operations Research SOC.Am.; Sorvell Miller, Raverly Press, Baltimore, lid.> business managcr), and The Institute of Management Sciences (Manayement Science; Alex Orden, Burroughs Research Center, Paoli, P3., secretary). Johns Hopkins, AIIT, and Case have graduate programs leading to a degree in operations research. NIT and Caae also offer short courses for personnel from business and industry. T h e two articles following this (pp. 394 and 402) illustrate the application of operations research to industrial problems and provide an excellent basis for judging what “OR” ip and ita potential value for industry.
C . WEST CHURCHMAN Case Institute o f Technology, Cleveland 6 , Ohio
INDUSTRIAL AND ENGINEERING CHEMISTRY
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