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Decision Science is the collection of quantitative techniques used to inform decision-making at the individual and population levels. It includes decision analysis, risk analysis, cost-benefit and cost-effectiveness analysis, constrained optimization, simulation modeling, and behavioral decision theory, as well as parts of operations research, microeconomics, statistical inference, management control, cognitive and social psychology, and computer science. By focusing on decisions as the unit of analysis, decision science provides a unique framework for understanding public health problems, and for improving policies to address those problems. How is decision science different from other research approaches?While most fields of research focus on producing new knowledge, decision science is uniquely concerned with making optimal choices based on available information. Decision science seeks to make plain the scientific issues and value judgments underlying these decisions, and to identify tradeoffs that might accompany any particular action or inaction. What kinds of tools and methods do decision scientists use?Decision science utilizes a variety of tools which include models for decision-making under conditions of uncertainty, experimental and descriptive studies of decision-making behavior, economic analysis of competitive and strategic decisions, approaches for facilitating decision-making by groups, and mathematical modeling techniques. Where is decision science used?Decision science has been used in business and management, law and education, environmental regulation, military science, public health and public policy. CHDS uses decision analytic methods to inform policies and practices that improve population health by systematically integrating scientific evidence with explicit consideration of individual and societal values for outcomes such as mortality, quality of life, and costs. FREQUENTLY ASKED QUESTIONSWhat is risk analysis? Risk analysis involves risk assessment (identifying and characterizing hazards to public health), risk management (evaluating how to protect public health), and risk communication (understanding and explaining health risks). It is used to protect public health and the environment by developing, organizing, and communicating knowledge about risks within a framework useful for individual, organizational, and government decision making. Learn more by visiting the Harvard Center for Risk Analysis website. What is cost-effectiveness analysis? Cost-effectiveness analysis compares the incremental costs of alternative interventions to their effects on health and longevity. It is typically used to prioritize and select among options for medical treatment and prevention. Costs are measured in monetary units. Outcomes, or effects, are measured in nonmonetary units. The effects measure may be natural units, such as deaths averted, life years gained, or cases of illness or injury avoided. Effects also may be measured using units that integrate effects on health and longevity, such as quality-adjusted life-years (QALYs) or disability-adjusted life-years (DALYs). What is benefit-cost analysis? Benefit-cost analysis is similar to cost-effectiveness analysis in that it compares the additional costs of alternative interventions to their outcomes. However, in this case the value of the outcomes is measured in monetary units, which may include both health and non-health benefits such as environmental improvements. These monetary values are estimated based on the willingness of those affected by the policy to exchange money for the outcome of concern. Benefit-cost analysis is often used to evaluate environmental, health, and safety regulations and policies. What is operations research? Operations research is a discipline that applies advanced analytical methods in order to facilitate better decision making. Operations research employs techniques from mathematical sciences, such as mathematical modeling, statistical analysis, and mathematical optimization, in order to determine optimal or near-optimal solutions to complex decision-making problems. Operations research emphasizes human-technology interaction, and focuses on practical applications, it overlaps with other disciplines including industrial engineering and operations management, as well as psychology and organization science. Operations research is often used to help determine the maximum (profit, performance, or yield for example) or minimum (loss, risk, or cost) of some real-world objective. While it originated out of military efforts before World War II, its techniques have grown and are applied to problems in all variety of industries.
The quantitative approach applies statistics, optimization models, information models, computer simulations, and other quantitative techniques to the management process. Central to the quantitative approach is the principle that organizations are decision-making units. These decision-making units can be made more efficiently using mathematical models that place relevant factors into numerical terms. The primary branches of quantitative management include:
Back to: BUSINESS MANAGEMENT Quantitative Management TechniquesSome of the primary techniques applicable to Quantitative Management include:
What is Management Science?This branch of management theory focuses on the development of mathematical and statistical models as a simplified representation of a system, process, or relationship as models, formula, and equations. These techniques help managers make maximum use of organizational resources to produce goods and services. This field of management has grown significantly with the development of computer systems and computational abilities. What is Operations Management?Operations management is a field of management focusing on efficiency, effectiveness, and producing or organizational systems, process, and functions used in the manufacture of goods or provision of services. It focuses on the operation and control of the production process (such as the use of resources) that transform resources into finished goods and services. It also looks at the extent to which the functional processes satisfy the needs and wants of the consumer. Operations management is a derivative of the mathematical models in which specified measurement systems are applied to operational scenarios. These methods are used to achieve a higher level of efficiency in operational tasks, such as plant layout, plant location, inventory control, and product distribution. Major areas of study within operations management include a product or process design, capacity planning, facilities location, facilities layout, materials requirement planning, and handling, scheduling, purchasing and inventory control, quality control, maintenance management, computer integrated manufacturing, just-in-time inventory systems, and flexible manufacturing systems. Types of operations management techniques include queuing theory, breakeven analysis, and simulation. These techniques are routinely applied to areas outside of operations. What is Total Quality Management?Total Quality Management (TQM) is a management theory developed following WWII during the reconstruction of Japan. Perhaps the best-known proponent of this school of management was W. Edwards Deming. Total quality management (TQM) is a management approach that focuses on the following elements of operations:
There are four phases of total quality management:
What is Lean Management?Lean management is an approach to management focusing on maximizing customer value while reducing processes waste without compromising quality. This is done through incremental improvement. The principles of lean management include:
Lean management seeks to achieve an ideal state of operations known as single-piece flow. In product production, this means eliminating the wastes associated with batch production. Instead, it focuses on single-production production. In any process, this principle seeks to eliminate wastes from unnecessary human motion, inventory inefficiency, labor inefficiencies, space inefficiencies, product defects, and overproduction. The benefits of lean management are that it reduces defects and manufacturing flexibility. The downside is that it can result in lower productivity and longer process cycles. Lean management was made popular by Toyota Corporation as part of its production process. Information systems allow for more efficient creation, management, and communication of information across the organization as well as in the outside environment. The information allows for more efficient management decision making by providing information in a more timely manner and in a more useful format. Notably, Decision Support Systems (DSS) integrate decision models and data to this end. What are the Positive and Negative Aspects of Quantitative Management Theory?Benefits include:
Negatives include:
Who are some of the primary contributors of various theories to the quantitative approach?
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