Operations Research (OR) in the US, and Operational Research in the UK, is an interdisciplinary branch of applied mathematics which uses methods like mathematical modeling, statistics, and algorithms to arrive at optimal or good decisions in complex problems which are concerned with optimizing the maxima (profit, faster assembly line, greater crop yield, higher bandwidth, etc) or minima (cost loss, lowering of risk, etc) of some objective function. The eventual intention behind using operations research is to elicit a best possible solution to a problem mathematically, which improves or optimizes the performance of the system.

The terms operations research and management science are often used synonymously. When a distinction is drawn, management science generally implies a closer relationship to the problems of business management. Operations research also closely relates to Industrial engineering. Industrial engineering takes more of an engineering point of view, and industrial engineers typically consider Operations Research (OR) techniques to be a major part of their toolset.

Some of the primary tools used by operations researchers are statistics, optimization, stochastics, queuing theory, game theory, graph theory, decision analysis, and simulation. Because of the computational nature of these fields, OR also has ties to computer science, and operations researchers regularly use custom-written or off-the-shelf software.

Operations research is distinguished by its frequent use to examine an entire system, rather than concentrating only on specific elements (though this is often done as well). An operations researcher faced with a new problem is expected to determine which techniques are most appropriate given the nature of the system, the goals for improvement, and constraints on time and computing power. For this and other reasons, the human element of OR is vital. Like any other tools, OR techniques cannot solve problems by themselves.

Scope of operations research

A few examples of applications in which operations research is currently used include:

• designing the layout of a factory for efficient flow of materials
• constructing a telecommunications network at low cost while still guaranteeing QoS (quality of service) or QoE (Quality of Experience) if particular connections become very busy or get damaged
• road traffic management and 'one way' street allocations i.e. allocation problems.
• determining the routes of school buses (or city buses) so that as few buses are needed as possible
• designing the layout of a computer chip to reduce manufacturing time (therefore reducing cost)
• managing the flow of raw materials and products in a supply chain based on uncertain demand for the finished products
• efficient messaging and customer response tactics
• roboticizing or automating human-driven operations processes
• globalizing operations processes in order to take advantage of cheaper materials, labor, land or other productivity inputs
• managing freight transportation and delivery systems (Examples: LTL Shipping, intermodal freight transport)
• scheduling:
  • personnel staffing
  • manufacturing steps
  • project tasks
  • network data traffic: these are known as queueing models or queueing systems.
  • sports events and their television coverage
• blending of raw materials in oil refineries

Operations research is also used extensively in government where evidence-based policy is used.

Nature of Work

Large organizations are very complex. They must effectively manage money, materials, equipment, and people. Operations research analysts find better ways to coordinate these elements by applying analytical methods from mathematics, science, and engineering. Analysts often find many possible solutions for meeting the goals of a project. These potential solutions are presented to managers, who choose the course of action that they think best.

Operations research analysts are often involved in top-level strategizing, planning, and forecasting. They help to allocate resources, measure performance, schedule, design production facilities and systems, manage the supply chain, set prices, coordinate transportation and distribution, or analyze large databases.

The duties of the operations research analyst vary according to the structure and management of the organization they are assisting. Some firms centralize operations research in one department; others use operations research in each division. Operations research analysts also may work closely with senior managers to identify and solve a variety of problems. Analysts often have one area of specialization, such as working in the transportation or the financial services industry.

Operations research analysts start a project by listening to managers describe a problem. Then, analysts ask questions and formally define the problem. For example, an operations research analyst for an auto manufacturer may be asked to determine the best inventory level for each of the parts needed on a production line and to ascertain the optimal number of windshields to be kept in stock. Too many windshields would be wasteful and expensive, whereas too few could halt production.

Analysts would study the problem, breaking it into its components. Then they would gather information from a variety of sources. To determine the optimal inventory, operations research analysts might talk with engineers about production levels, discuss purchasing arrangements with buyers, and examine storage-cost data provided by the accounting department.

Relevant information in hand, the analysts determine the most appropriate analytical technique. Techniques used may include a Monte Carlo simulation, linear and nonlinear programming, dynamic programming, queuing and other stochastic-process models, Markov decision processes, econometric methods, data envelopment analysis, neural networks, expert systems, decision analysis, and the analytic hierarchy process. Nearly all of these techniques involve the construction of a mathematical model that attempts to describe the system being studied. So, the problem of the windshields, for example, would be described as a set of equations that try to model real-world conditions.

The use of models enables the analyst to explicitly describe the different components and clarify the relationships among them. The descriptions can be altered to examine what may happen to the system under different circumstances. In most cases, a computer program is developed to numerically evaluate the model.

Usually the model chosen is modified and run repeatedly to obtain different solutions. A model for airline flight scheduling, for example, might stipulate such things as connecting cities, the amount of fuel required to fly the routes, projected levels of passenger demand, varying ticket and fuel prices, pilot scheduling, and maintenance costs. By assessing different possible schedules, the analyst is able to determine the best flight schedule consistent with particular assumptions.

Based on the results of the analysis, the operations research analyst presents recommendations to managers. The analyst may need to modify and rerun the computer program to consider different assumptions before presenting the final recommendation. Once managers reach a decision, the analyst usually works with others in the organization to ensure the plan’s successful implementation.

Work environment. Operations research analysts generally work regular hours in an office environment. However, because they work on projects that are of immediate interest to top managers, operations research analysts often are under pressure to meet deadlines and may work more than 40 hours a week

Training, Other Qualifications, and Advancement

A college degree in operations research generally is required. Computer programming skills are essential.

Education and training. Employers generally prefer applicants with at least a master’s degree in operations research or a closely related field—such as computer science, engineering, business, mathematics, information systems, or management science—coupled with a bachelor’s degree in computer science or a quantitative discipline such as economics, mathematics, or statistics. Dual graduate degrees in operations research and computer science are especially attractive to employers. There are more than 130 programs in operations research and related studies in colleges and universities across the United States.

Continuing education is important for operations research analysts. Keeping up to date with technological advances and improvements in analytical methods is vital for maintaining their problem-solving skills.

Other qualifications. Computers are the most important tools used by operations research analysts, so analysts must have training and experience in programming. Analysts typically also need to be proficient in database collection and management, and the development and use of sophisticated software packages.

Operations research analysts must be able to think logically, work well with people, and write and speak well.

Advancement. Beginning analysts usually perform routine work under the supervision of more experienced analysts. As novices gain knowledge and experience, they are assigned more complex tasks and are given greater autonomy to design models and solve problems.

Operations research analysts can advance by becoming technical specialists or supervisors on more complicated projects. Analysts also gain valuable insights into the industry where they work and may assume higher level managerial or administrative positions. Operations research analysts with significant experience or expertise may become consultants, and some open their own consulting practices.

Job Outlook

Employment of operations research analysts is projected to grow as fast as the average for all occupations. Individuals with a master’s or Ph.D. degree in operations research or a closely related subject should find job opportunities in a number of occupations that use their computer, mathematical, and problem-solving skills.

Demand for operations research analysis should continue to grow. Organizations increasingly will be faced with the pressure of growing domestic and international competition and must work to make their operations as effective as possible. As a result, businesses increasingly will rely on operations research analysts to optimize profits by improving productivity and reducing costs. As new technology is introduced into the marketplace, operations research analysts will be needed to determine how to use the technology in the best way.

Job prospects. Graduates with degrees in operations research or closely related fields should find opportunities in a number of occupations where their computer, mathematical, and problem-solving skills are needed—operations research analyst, systems analyst, computer scientist, or management analyst, for example. In addition to job growth, some openings will result from the need to replace analysts retiring or leaving the occupation permanently for other reasons. Analysts who keep up with the latest technological advancements and software will have the best opportunities.

Jobs for operations research analysts exist in almost every industry because of the diversity of applications for their work. As businesses and government agencies continue to contract out jobs to cut costs, opportunities for operations research analysts will be best in management, scientific, and technical consulting firms. Opportunities in the military exist as well, but will depend on the size of future military budgets. Military leaders rely on operations research analysts to test and evaluate the accuracy and effectiveness of new weapons systems and strategies.