bluuebunny/crossref_metadata_2025 huggingface dataset:
Three Heuristic Rules for Sequencing Jobs to a Single Production Facility
Authors: Gavett J. William
Published: November 2008

This paper presents the experimental performance of three elementary rules for sequencing jobs through a single production facility. The problem is a variant of the “traveling salesman problem.” It is presented in terms of the job sequencing problem because of practical constraints on problem solving methods encountered in this situation. The objective of the sequencing decision is to minimize the facility downtime or setup time over a finite batch of jobs. The study consists of examining the performance of the three heuristic rules in terms of two criteria. The first is the optimal downtime obtained by the branch and bound algorithm. The second is the downtime which results from a random sequencing of jobs through the facility. The sampling procedure considers different values of the variance of between-job setup times, the number of jobs in the sequencing batch, and the form of the distribution of setup times.
Statistical Control Applications in Linear Programming
Authors: Enrick Norbert Lloyd
Published: November 2008

Solution of the product mix problem of Linear Programming leads to recommended quantities of various product styles that must be sold if the firm's ideal profit potential, based on productive capacity and market requirements, is to be realized.

In practice, management has the task of making day-to-day and hour-to-hour decisions, designed to lead towards the attainable maximum profit. Sometimes, sudden opportunities arise for management to contract for the production of one product style for one customer, with quantities far in excess of those recommended in the L. P. solution. An on-the-spot decision to accept or reject the customer's bid must be made. Indeed, he may still be on the long-distance wire, expecting a response. Statistical control limits will help management in such situations, by showing the extent to which a recommended quantity on any product style may be violated, while still remaining within a predetermined percentage of the plant's ideal profit potential.

Without such statistical control limits, management would have to await the outcome of a new L. P. analysis before knowing the effect of accepting or rejecting special bids, such as just described.
Econometrics and Management Science: Their Overlap and Interaction
Authors: Thiel H.
Published: November 2008

This is an expository article on the relationship of econometrics and management science. After some general observations it considers a number of applications, such as prediction on the basis of input-output models and of econometric macromodels and decision-making based on linear decision rules. These rules are applied to cost minimization in a factory and welfare maximization for a country as a whole. In the last part of the paper some attention is paid to uncertainty problems with respect to the constraints subject to which maximization or minimization takes place.
Solvable Nuclear War Models
Authors: Dalkey Norman C.
Published: November 2008

This paper deals with an aggregated, two-sided war game, one of several designed to study the use of abstract models for strategic planning. A payoff function for the war game is defined making use of an assumption of increasing concern as a critical level of damage is approached. A very simple, one-weapon version of the central nuclear war game has an analytic solution, indicating the existence of a stable (equilibrium) point in pure strategies if each side has a nonnegligible counterforce capability.
Independence, Trade-Offs, and Transformations in Bivariate Utility Functions
Authors: Fishburn Peter C.
Published: November 2008

This paper explores several important notions relevant to modern utility theory. Restricting the discussion to the consideration of bivariate utility functions, the paper defines and examines the interrelationships between (1) independence in the utility sense, (2) trade-off or indifference curves, and (3) transformation curves (as defined herein).

Following the form in which a set of basic axioms of utility are stated, independence is defined in terms of indifference between 50-50 gambles, and it is shown that, if the condition of the definition holds, then φ(x, y), the bivariate utility function, can be written as a function of x plus a function of y. The concepts of trade-off curve (indifference curve) and transformation curve are also defined on the basis of the indifference relation but are not concerned with gambles.

After exploring relationships among the three notions it is shown how the utility curves for the two variables under independence can be constructed on the basis of two trade-off curves.
Non-Linear Programming with Randomization
Authors: Fromovitz Stan
Published: November 2008

This paper considers non-linear programming models in which randomized solutions are allowed. That is, we consider the minimization of the expected value of a non-linear function subject to constraints on the expectation of nonlinear functions, where the expectations are taken with respect to randomized decision strategies. Saddle-point and related optimality conditions similar to those given in [Karlin, S. 1959. Mathematical Methods and Theory in Games, Programming, and Economics, Vol. 1, Chapter 7, Addison-Wesley.] and [Kuhn, H. W., A. W. Tucker. 1951. Nonlinear programming. Proceedings of the Second Berkeley Symposium on Mathematical Statistics and Probability. University of California Press, 481–492.] for convex functions are obtained with only very mild restrictions on the shape of the optimizing and constraint functions. We also consider when the optimal solution need not be randomized and how the notions of Lagrange multipliers and game theory are related to our results. We offer an economic interpretation of our solution. A few simple examples are given to illustrate the implications of randomized strategies. It is also pointed out how the results of this paper are related to the decomposition methods widely used to solve mathematical programming problems.
Communications to the Editor—Note on the Problem of Lump-Sum Losses in Sales Training
Authors: Harris Lawrence
Published: November 2008

Companies that organize large scale training programs for technical salesmen often find that a certain proportion of these salesmen do not complete the program. Thus, at the completion of the program the company finds itself short of the required number of trained salesmen, unless it has originally hired more technical salesmen than it requires. This note discuses a decision-theoretic approach to this problem of overhiring; that is, how many trainees should be hired in order to have the right number of trained salesmen at completion of the training program and still minimize variable training costs.
A Note on the Sequential Unconstrained Minimization Technique for Non-Linear Programming
Authors: Stong Robert E.
Published: November 2008

This note considers a method due to Carroll for replacing a constrained minimization problem by a sequence of unconstrained problems. Mathematical validity or convergence of this technique is shown under fairly general conditions. No computability is asserted beyond that obtained by other authors under more restrictive assumptions.
The Systems Approach to the National Health Problem
Authors: Horvath William J.
Published: November 2008

The practice of medicine is presently undergoing considerable modification due to technological innovations. There is a constant flow of new drugs, new treatment methods, new diagnostic techniques and new administrative procedures. In some respects, this plethora of new developments has proved an embarrassment to the medical system. New drugs are marketed and then withdrawn as side effects are manifested; pre-paid medical plans and hospitalization insurance rates are continually modified to keep pace with the new services provided; and the average practitioner has difficulty keeping abreast of new developments while trying to provide maximum service to his patients. In order to enable this system to function effectively in the face of increasing technical advances, the medical profession will have to draw on the resources of systems analysis. This is the only way in which the interrelationships of the different parts of the system can be understood, hopefully to the point where it will be possible to predict the effects on any particular part of the system of changes made in other parts. Since the feedback loops of large social systems such as the medical system are still not well understood, the use of gaming and simulation procedures is proposed as a first step toward such a systems study.
Better Estimates of Confidence Intervals for Very Low Error Rate Population
Authors: Birnberg Jacob G. , Pratt Robert J. A.
Published: November 2008

In the estimation of error rates for populations, whose error rate is quite small, the usual assumption of normality can lead to erroneous results. The confidence interval that is actually calculated for any given probability will have too low a lower bound, and not a high enough upper bound. Thus, the user may be misled into too optimistic a view of the population being sampled. This article discusses the nature of the problem and provides graphs from which the more accurate interval can be read. The final section of the paper deals with the related problem of confidence intervals when the observed error rate is zero. Tables are provided which facilitates the developing of confidence statements for such samples.
The Corporate CIA—A Prediction of Things to Come
Authors: Fair William R.
Published: November 2008

This paper presents the case that there will soon be a confluence of the technical capability, manpower and motivation for corporations to know their competitors much better than they do now. An argument is given that a recognized new corporate activity will develop whose mission will be to study competitors with a view to finding weaknesses which can be capitalized upon. A likely consequence of this development will be the growth of covert activities of a kind which are at least distasteful, are probably immoral and possibly are illegal. If the development of corporate CIA's takes place there will be a new and fascinating arena for analytic skills, but the practitioner will be faced with some very demanding questions of what shall constitute moral behavior.
Some Observations on Research Institute Administration in the U.S.A.
Authors: Marks Benzion
Published: November 2008

Observations about the administrative procedures of a large number of a research laboratories in the USA, Great Britain, and Denmark.
A Dynamic Programming Approach to a Lot Size Scheduling Problem
Authors: Bomberger Earl E.
Published: November 2008

The problem considered is that of scheduling the production of several different items over the same facility on a repetitive basis. The facility is such that only one item can be produced at a time; there is a setup cost and a setup time associated with producing each item; the demand rate for each item is known and constant over an infinite planning horizon, and all demand must be met.

A dynamic programming solution is developed. This solution is applied to a sample problem, and the results are compared with pertinent bounds.
Programming with a Quadratic Constraint
Authors: van de Panne C.
Published: November 2008

A method is given for maximizing a linear function subject to a quadratic and a number of linear constraints. The method differs from general convex programming methods by terminating in a finite number of iterations and is actually an application of the Simplex and dual methods for quadratic programming to parametric quadratic programming problems. The method is shown to be useful for the solution of some chance-constrained programming problems. Detailed rules and a simple example of an application are given.
Erratum
Authors: Beightler Charles S.
Published: November 2008

Correction to the article Beightler, C. S., D. J. Wilde. 1966. Diagonalization of quadratic forms by Gauss elimination. Management Sci. 12(5, January) 371–379.
A Dynamic Model for Competitive Marketing in Coupled Markets
Authors: Shakun Melvin F.
Published: November 2008

A dynamic model is developed for competitive marketing situations involving products whose markets are coupled. By coupling it is meant that advertising dollars spent in generating sales for one product have an influence on the sales of another product. A game-theory approach is taken, and noncooperative equilibrium solutions for advertising expenditures are developed. Effectiveness is measured by weighted future profits. Various aspects of model building for coupled markets are discussed. The present dynamic model treats any number of competitors and products. It thus extends previous work by the author on a two competitor, two product, static model for coupled markets.
Why Only Few Operations Researchers Manage
Authors: Beged-Dov A. G.
Published: November 2008

Discussed are some issues which were raised at a session devoted to OR education at the 1964 TIMS-ES Joint European Conference. The central contention of this paper is that the single most reliable indicator of how effective is OR is the proportion of operations researchers who eventually attain general management responsibilities. The main obstacles standing in the way of conducting superior Operations Research are discussed. It is claimed that certain alarming developments in the practice and education of Operations Research must be arrested. Otherwise, the discipline will not be able to effectively solve the more challenging problems of business and society.
Commentary
Authors: Bennis Warren G.
Published: November 2008

Comments about Churchman, C. W., A. H. Schainblatt. 1965. The researcher and the manager: A dialectic of implementation. Management Sci. 11 (4) B-69–B-87.
Commentary
Authors: Solandt O. M.
Published: November 2008

Comments about Churchman, C. W., A. H. Schainblatt. 1965. The researcher and the manager: A dialectic of implementation. Management Sci. 11 (4) B-69–B-87.
Commentary
Authors: Abrams John W.
Published: November 2008

Comments about Churchman, C. W., A. H. Schainblatt. 1965. The researcher and the manager: A dialectic of implementation. Management Sci. 11 (4) B-69–B-87.
Commentary
Authors: Starr Martin K.
Published: November 2008

Comments about Churchman, C. W., A. H. Schainblatt. 1965. The researcher and the manager: A dialectic of implementation. Management Sci. 11 (4) B-69–B-87.
A General Model for Exponentially Compounding and Discounting Future Cash Flows
Authors: Thompson William W.
Published: November 2008

This paper presents a general model to be used in adjusting cash flows which occur over future time intervals to reflect the effects of continuous compounding and/or discounting. The method is illustrated by means of a hypothetical example. The framework of analysis employed here may be extended to other systems having similar characteristics of growth and decay.
An Analysis of Criteria for Investment and Financing Decisions Under Certainty
Authors: Teichroew Daniel , Robichek Alexander A. , Montalbano Michael
Published: November 2008

The objective of this paper is to investigate the decision-making procedure for accepting or rejecting investment or financing alternatives available to the firm. The properties of the decision rules based on discounted present value and internal rate of return are studied for the class of projects described by a finite sequence of cash flows. The necessary and sufficient conditions under which the decision rules lead to unique solutions are derived. Where the decision rule does not provide a unique solution, it is necessary to define two rates: the project investment rate and the project financing rate. The extension of the project analysis in terms of the two rates permits the derivation of unambiguous decision rules for all projects. The relevance of the results is discussed in the summary.
Capital Accumulation and Production for the Firm: Optimal Dynamic Policies
Authors: Iglehart Donald L.
Published: November 2008

In this paper we consider a firm that must make a production decision and a capital decision at periodic intervals of time. The cost of production is assumed to be convex and the firm is allowed to hold inventories. For a class of inventory and capital costs the optimal production and capital decisions are obtained for an n-period problem. The optimality criterion used is minimization of the expected present value of costs in the n periods.
The Direct Power of Adjacent Vertex Programming Methods
Authors: Martos B.
Published: November 2008

How far does the power of the adjacent vertex methods extend in solving non-linear programming problems? This question here gets a partial answer, being restricted to variables and objective functions which are continuous and excluding any transformation or approximation of the original system. The underlying concepts are that of quasi-concavity and quasi-monotonicity. Necessary and sufficient characteristics of the family of objective functions are given in due generality although in some cases subject to several differentiability assumptions. For these latter cases a simple criterion of vector selection is presented. Finally the problem of linear fractional programming is briefly discussed as an example.
Integer Programming: Methods, Uses, Computations
Authors: Balinski M. L.
Published: November 2008

This paper attempts to present the major methods, successful or interesting uses, and computational experience relating to integer or discrete programming problems. Included are descriptions of general algorithms for solving linear programs in integers, as well as some special purpose algorithms for use on highly structured problems. This reflects a belief, on the author's part, that various clever methods of enumeration and other specialized approaches are the most efficacious means existent by which to obtain solutions to practical problems. A serious try at gathering computational experience has been made—but facts are difficult to uncover.

The paper is written with intent to enable readers to read selected sections without having to read the whole.
Summary and Evaluation of Recent Work in Measuring the Productivity of Federal Agencies
Authors: Kendrick John W.
Published: November 2008

The paper contains first a discussion of the nature and meaning of productivity index numbers. Productivity measures are viewed as ratios of output to input, in real terms. They largely reflect changes (or differences) in the technology and organization of production over time (or between similar producing units). The applicability of productivity measurement systems to Federal Government organizations is discussd. Results of the Bureau of Budget report Measuring Productivity of Federal Government Organizations are summarized. While the report covers only 5 Federal, civilian organizations, the author concludes that productivity measurement could usefully be extended to most other civilian agencies, and to some functions of the Department of Defense, particularly in the supply and maintenance areas.
A Packaging Problem
Authors: Wilson Richard C.
Published: November 2008

A number of packaging problems involve optimization of costs subject to constraints imposed by the geometry of the alternatives. One such problem arises in those consumer goods warehousing systems which pack a large number of similar products, differing in size, into individual boxes for warehousing and subsequent shipment to the ultimate consumer. Box cardboard costs and warehouse space costs are minimized if boxes exactly fit each product size; on the other hand, box inventory, handling, and purchase costs are minimized if only one box size is used for all product sizes. The problem is to select the optimum number and sizes of boxes which minimize the total system costs. An integer programming formulation of the problem is given, and the results obtained from the application of a heuristic procedure to a specific problem are described.
Diagonalization of Quadratic Forms by Gauss Elimination
Authors: Beightler Charles S. , Wilde Douglass J.
Published: November 2008

The La Grange linear similarity transformation (completing the square) can be used to remove all cross-product terms from a quadratic form. It is shown that the La Grange transformation may be found conveniently by adapting the well-known Gauss elimination procedure for solving linear equations. A simple algorithm for finding the inverse transformation is given. This diagonalization scheme takes much less effort than finding the characteristic roots and vectors. It produces important simplifications in quadratic programming, statistics, and optimization problems.
The (S − 1, S) Inventory Policy Under Compound Poisson Demand
Authors: Feeney G. J. , Sherbrooke C. C.
Published: November 2008

This paper derives the simple analytic solution to the special but important inventory problem in which the optimal policy is to reorder whenever units are demanded. The demand distribution can be any compound Poisson; the resupply distribution is arbitrary. Both the backorder case and the lost sales case are solved by generalizing a queueing theorem due to Palm.

The steady state probabilities for the number of units in resupply (or repair) completely describe the item's long term behavior, and are simply the normalized values of the compound Poisson demand distribution based on the mean of the resupply distribution but not on the distribution itself. Knowledge of these state probabilities enables us to compute several measures of item supply performance as a function of the spare stock, s. Traditional inventory analysis can then be applied to minimize total cost based on estimates of holding cost and supply performance cost.

The appendices contain a description of the algorithm and the computer program for calculating stuttering Poisson state probabilities and the measures of effectiveness for the backorder case. Numerical illustrations are also provided.
A Linear Model Approach to Time and Cost Analysis
Authors: Williams W. H.
Published: November 2008

Systems analyses frequently require estimates of the average time that it takes to perform repetitive tasks. These time estimates may be easy to obtain; for example, if one man is performing a single operation, then a simple division of his total working time by the frequency of the task repetition, gives an estimate of the average performance time. However, in many instances, work consolidation requires that individuals be called upon to perform several different operations. For example, crews may be sent into the field to carry out a number of different tasks, for which the relative rate of occurrence may change from day to day.

This introduction of multiple operations implies that the required separate time estimates can no longer be obtained by a simple division. This paper discusses linear model estimation of the average time taken to perform specific tasks; the estimation is possible even when a number of different tasks are performed by an individual or group. The models are based on the conceptual relation that the time taken to perform a task multiplied by the rate of occurrence in the considered time period, and summed over all possible tasks, should equal the total time taken by all tasks. Estimation is also possible when direct observations are difficult to obtain (as in stopwatch procedures) because the proposed models do not require direct time observations but rather utilize linear combinations of the individual time parameters.

An actual application is discussed.
Optimal Programming of Lot Sizes, Inventories and Labor Allocations—A Comment
Authors: Grigoriadis Michael D.
Published: November 2008

In a recent article in this journal, B. P. Dzielinski and R. E. Gomory [Dzielinski, B. P., R. E. Gomory. 1965. Optimal programming of lot sizes, inventory and labor allocations. Management Sci. 11(9, July) 874–890.] discussed the use of the Dantzig-Wolfe decomposition principle to accomplish a reduction in the large number of constraints appearing in the linear programming tableau. A comment is included on the maximum number of fractional solutions, i.e. the solutions specifying that items are to be manufactured according to two or more production plan sequences. The interpretation of such solutions in terms of the physical situation requires special attention and treatment on the part of the analyst.
A Utility Function Derived from a Survival Game
Authors: Borch Karl
Published: November 2008

The starting point of the paper is a firm engaged in a risky business. It is assumed that the firm's gain in each operating period is a stochastic variable. It is further assumed that these stochastic variables are independent and identically distributed. If the capital of the firm becomes negative, the firm is ruined, and must go out of business.

The optimal dividend policy is defined as the policy which will maximize the expected discounted value of the dividends paid before ruin occurs. It is then shown that the solution of the dividend problem gives the utility function, which will govern the firm's decisions under uncertainty.

From this result it appears that a number of decisions which seem irrational when studied in isolation, become perfectly rational when analysed in their proper dynamic setting.
Optimization of Seismic Reconnaissance Surveys in Petroleum Exploration
Authors: Pachman Jerrold M.
Published: November 2008

The seismic reflection method employed in petroleum exploration is described, after which the problem of selecting the optimum cell size for a uniform rectangular seismic reconnaissance search pattern is stated in terms of elementary search theory. The search effectiveness for each pattern is estimated by a Monte Carlo approach due to the probabilistic nature of target geometry. The problem of allocating a limited amount of search effort to a number of regions to be searched simultaneously is formulated as a dynamic programming problem in which the decision variables are the search pattern parameters and the inter-shot point spacing along the survey lines. The approach is easily generalized so that pattern morphology and orientation also become decision variables.
Applying a Model of Organization Structure to the Analysis of a Wood Products Market
Authors: Mackenzie Kenneth D. , Frazier George D.
Published: November 2008

The purpose of this paper is to demonstrate the use of the set theoretic model of organizations developed by Mackenzie in the study of complex market organizations. Part one briefly outlines the mathematical development of Mackenzie's model. Part two describes the organization and structure of the wood products market in Los Angles within the framework of this model.
Communication to the Editor—Critical Comments on “Measuring Risk on Consumer Instalment Credit” by Paul F. Smith
Authors: Cohen Kalman J. , Hammer Frederick S.
Published: November 2008

In his article [Smith, P. F. 1964. Measuring risk on consumer instalment credit. Management Sci. 11(2, November) 327–340], Smith develops a simple statistical method for measuring risk on individual accounts which he feels can be used for controlling the quality of portfolios of consumer instalment loans and for estimating loss rates. His tests seem to indicate that this approach is promising. There are, however, grave deficiencies in both the testing procedure and the conceptual foundations of his approach. To see this clearly, the more important problems that arise will be discussed in the same order as they occur in the article.
Experimental Methods in Quadratic Programming
Authors: Moore J. H. , Whinston A. B.
Published: November 2008

This paper considers a class of algorithms for solving quadratic programming problems. An attempt is made to rank the various procedures. Computational results are given and a discussion of the results is presented.
A Minimum Risk Manpower Scheduling Technique
Authors: Jewett Roger F.
Published: November 2008

An approach to decision making under uncertainty is presented and its application to manpower scheduling discussed. The Minimum Risk technique yields an optimum series of manpower levels over a time interval in which the workload (manpower required for each period) is not known. It is assumed that the possible workloads can be described, defined by a finite set of mutually exclusive manpower requirements, and their probabilities can be estimated. Each possible workload is examined and the risk of a particular manpower level is related to the added (transition) cost of performing whatever workload occurs, given this manpower level.

The subject technique represents a decision-making tool which has been applied to engineering and scientific personnel planning for over one year. Accordingly, some of the operational aspects of the method are discussed. Linear cost functions and subjective probabilities are used and some practical characteristics of such a formulation are also described.
Critique of: “Basic Concepts for a Theory of Organization”
Authors: Goldner Fred H.
Published: November 2008

A critique of Stogdill, R. M. 1967. Basic concepts for a theory of organization. Management Sci. 13 (10, June) B-666–B-676.
Critique of: “Basic Concepts for a Theory of Organization”
Authors: Stinchcombe Arthur L.
Published: November 2008

A critique of Stogdill, R. M. 1967. Basic concepts for a theory of organization. Management Sci. 13 (10, June) B-666–B-676.
The Determination of Optimal Investment Policy
Authors: Hastie K. Larry
Published: November 2008

Using a model similar to Sharpe's, the author discusses the shape of the efficient frontier of security portfolios and the determination of an optimal investment policy. Sharpe shows that in equilibrium, the expected returns and standard deviations of all efficient security portfolios lie along a straight line. In this article, the author demonstrates that this conclusion depends on the assumptions that there exist both a risk-free asset and a single interest rate at which all investors can borrow or lend funds. If either assumption is removed, the expected returns and standard deviations of efficient portfolios will not be linearly related. The author suggests that in equilibrium, the efficient frontier is not unique for all investors, but that the efficient frontier will be different for investors with different borrowing rates. Furthermore, if no risk-less asset exists, a portfolio may exist which has both higher expected real return and lower risk than does a default-free security.
Developing Standards for Library Expenditures
Authors: Niland Powell
Published: November 2008

This paper reports the results of a project to use simple and multiple regression to develop standards for evaluating budget proposals of a university library. Based on a seven-year sample of actual expenditure data, ending with the academic year 1964–65, regression equations were developed for each of the five major categories of library expenditures. These equations were tested against the expenditures approved for the academic year 1965–66. Based on this test, useful standards were developed by employing the regression technique. The technique is proposed as a device for coping with the control of complex activities for which direct standard setting is difficult or prohibitively expensive, in institutional, governmental or business organizations.
An Open Letter to the Newer (And Senior) Members of TIMS
Authors: Howard Ronald A.
Published: November 2008

It occurred to me that by writing a letter to the newer members I could assure them that there is not only an opportunity, but a real need for them to become involved with the operation of the Institute at both national and local levels.
Optimal Level Debt Schedules for Municipal Bonds
Authors: Cohen Kalman J. , Hammer Frederick S.
Published: November 2008

An important restriction which frequently appears in the bid specifications for new issues of municipal bonds is that the total dollar amount to be paid for both principal and interest by the municipality in any given year of the issue must not be significantly different from the total dollar amount to be paid in any other year, i.e., that the total payout pattern over the lifetime of the bond issue must be substantially level. Because of this “level debt” restriction, the inter-relationships between coupon schedule and maturity schedule appear to underwriters as being very complex. Given the requirements of the marketplace, bond market professionals presently employ trial-and-error techniques in an attempt to determine the admissible coupon and maturity schedule which will lead to the lowest possible net interest cost. The present paper shows that the determination of this optimal coupon and maturity schedule for a level debt issue can be readily accomplished by linear programming techniques.
Heuristics in Job Shop Scheduling
Authors: Gere William S.
Published: November 2008

The problem is that of scheduling jobs with diverse routings on the productive facilities in a shop such that the respective due dates are met, or failing this, the sum of lateness times is minimized. The approach is simulative in that the operation of the shop is simulated in a Fortran program, but in addition to the straightforward use of priority rules for determining sequences of jobs on the machines, a number of heuristics or rules of thumb are incorporated. Both the static and dynamic problems are investigated. The efficacy of a small number of heuristics in combination with certain priority rules is demonstrated.
The Efficient Use of an Imperfect Forecast
Authors: Thompson Howard E. , Beranek William
Published: November 2008

This paper illustrates how individual forecasts and forecasting techniques may be evaluated by the use of established decision theory. Given the probability distribution of the forecast error, we first find the optimal strategy for a decision process, i.e., how to make the most efficient use of a forecast. After expressing the expected profit of the optimal strategies in terms of the probability of a correct forecast, we illustrate how to find (1) the value of an imperfect forecast, and (2) the value of a forecasting technique. With this information, we can then determine when to use a forecast, the maximum amount to pay for both a forecast and a forecasting method, and the conditions under which it is worthwhile to attempt to improve the accuracy of a forecasting method.
Generalized Cuts in Diophantine Programming
Authors: Glover Fred
Published: November 2008

In the generation of an additional constraint or cut for integer programming introduced by Ralph Gomory, there is a certain parameter whose value is customarily chosen so that one of the original variables has a zero coefficient in the cut-equation. In this paper we consider alternative values of the parameter and refer to any linear combination of the original source equation and this cut as a “generalised cut”. Attention is then focused, as customary, on those cuts of this type for which the original variable has a zero coefficient. In particular, we show how to determine values for Gomory's parameter so that only a subset of the feasible solutions to the cuts used by Gomory's method of integer forms are feasible for the generalised cuts.
Communications to the Editor—An Analysis of Criteria for Investment and Financing Decisions Under Certainty: A Comment
Authors: Mao James C. T.
Published: November 2008

In a recent article [Teichroew, D., A. A. Robichek, M. Montalbano. 1965. An analysis of criteria for investment and financing decisions under certainty. Management Sci. 12(3, November) 151–179.] in this Journal, Daniel Teichroew, Alexander A. Robichek, and Michael Montalbano (TRM) investigated the decision-making procedures for accepting or rejecting investment alternatives available to the firm. There are, however, certain key ideas in their article which need either further clarification or simple modification. It is hoped that by suggesting these clarifications and modifications, this note will make more clear the full value of TRM's basic contributions.
On the Expected Duration of PERT Type Networks
Authors: Elmaghraby Salah E.
Published: November 2008

In PERT-type networks, where activity times are random variables, the expected duration of the total project can be approximated by first substituting the expected values of the individual activities, and then evaluating the length of the critical path. This paper develops two improved estimates. Both estimates approach the true expected duration from below, i.e., they are both optimistic estimates.
Subjective Time Estimates in Critical Path Planning—A Preliminary Analysis
Authors: King William R. , Wilson Talmadge A.
Published: November 2008

A historical analysis of activity time estimates made by a number of contractors on a large-scale systems development project is conducted using two basic hypotheses.

(1) Pre-activity time estimating accuracy improves as the beginning date of the activity approaches.

(2) Time estimates made during the progress of an activity improve in relative accuracy as the completion date of the activity approaches.

These hypotheses are tested and several models for adjusting time estimates on the basis of the estimator's past history are developed and tested. The results are not proposed to be definitive—but rather, preliminary ones which should serve to demonstrate the feasibility of the basic approach.
On the Convergence of Periodic Reinvestments by an Amount Equal to Depreciation
Authors: Ijiri Yuji
Published: November 2008

This paper analyzes the pattern of periodic reinvestments in depreciable assets when the amount of reinvestment in each period is set equal to the amount of depreciation for the period and derives a constant to which the periodic investments converge. The expression for the constant which depends upon the depreciation method is then interpreted in terms of the firm's investment and financing policy as well as its growth rate.
Inflow of Private Capital and Choice of Planning Strategies
Authors: Panchamukhi V. R.
Published: November 2008

International flow of private capital can be seen as a situation wherein a variety of conflicting interests are involved. The interests of the government of the country in which foreign investment takes place, do not concur with the interests of the foreign private investor. The interests of the foreign private investor and those of the government of his own country can be mutually conflicting ones, since the private profitability of an investment project differs from its social desirability. The interests of the government of the capital exporting country and those of the government of the capital-importing country, can also be at variance with each other. Our attention here is confined to analyse the first category of conflict of interests, in which the foreign private investor and the government of the capital importing country are the two policy-makers. In this situation, interests of one policy-maker are affected by the choice of planning strategies by the other policy-maker and each wants to choose his strategies so as to “optimise” his interests. The purpose of this paper is to demonstrate the usefulness of Game Theory approach in arriving at the “best” planning strategies open to the two policy-makers involved. In the immediately following two sections, we describe the interests of the foreign private investor and those of the government of the capital-importing country (hereinafter called the domestic planner). In the remaining sections, we discuss the problem of optimum policy making as a two-person non-zero-sum game, with the domestic planner and the foreign private investor as the players of the game. The appendix gives the mathematical formulations of the game model and its solutions.
METRI and The Allowance List Problem
Authors: Cooper Gershon
Published: November 2008

The fundamentals of the METRI approach to model-building are discussed. This approach may have applicability where the system to be modelled involves very large numbers of variables, ignorance, uncertainty, and hierarchical relationships, and where the decisions to be made involve enormous amounts of detail. Since the approach was developed in the context of the “allowance list” problem, the application of the approach to that problem is discussed in detail. The problem of “validation” is also discussed, since, as in some other cases, the payoff measure defined by the model has no close parallel in terms of independently available data. The paper is basically an account of certain aspects of a U.S. Navy project.
Mathematical Models of Growth Allowances for Public Utility Regulation—A Synthesis
Authors: Sparrow F. T.
Published: November 2008

The construction and application of mathematical models which aid in the determination of fair rates of return for regulated industries is a development of potentially great importance to both the theoretician and the purchaser of regulated industry services. This paper shows that the two apparently dissimilar models of fair rates of return under conditions of growth found in the literature are derivable from a third more general model of such a process. The relative usefulness of the models is discussed, along with the validity of the behavioral assumptions that underlie the models.
A Heuristic Model for Scheduling Large Projects with Limited Resources
Authors: Wiest Jerome D.
Published: November 2008

Present PERT-type scheduling models implicitly assume unlimited availability of resources. As most project schedulers are aware, however, activities may be constrained in their start dates by availability of resources as well as by technological orderings. Analytic solutions to the limited-resource, project scheduling problem are infeasible at present for all but small projects; heuristic approaches seem most promising of useful results. One such approach, described here, is a computer model capable of scheduling single or multiple projects within resource limits and other constraints commonly encountered by the project scheduler. The basic formulation of the model is discussed along with its scheduling heuristics which determine the period-by-period allocation of resources to activities in a project. By changing certain parameters and heuristics in the model, one can simulate project scheduling under varying constraints and scheduling rules. Applications of the model to a number of fictitious and real projects are described.
Time Sharing, Management, and Management Science
Authors: Feeney G. J.
Published: November 2008

This is going to be a talk: mostly about time sharing, a little bit about the implications for management and an even smaller bit about the implications for management science. Not that these implications are minor. On the contrary, I think time sharing is going to produce profound, irreversible changes in both the practice and the science of management. But instead of the usual inspirational harangue on the revolutionary future that time sharing will bring, let's take a close look at the technical and economic fundamentals which define the invention and the necessity that it answers. Once these fundamentals are clear, you can make your own forecasts.
Methods of Estimating Additive Utilities
Authors: Fishburn Peter C.
Published: November 2008

Additive utility formulations for risky and nonrisky multiple-factor decision situations are reviewed. Twenty-four methods of estimating additive utilities are listed and classified. References to the theory and technique of each method are given along with a short discussion of each. A number of examples are used to illustrate the methods.
A Linear Programming Algorithm for Mutual Fund Portfolio Selection
Authors: Sharpe William F.
Published: November 2008

The portfolio selection problem faced by a mutual fund manager can be formulated following the Markowitz approach: find those portfolios that are efficient in terms of predicted expected return and standard deviation of return, subject to legal constraints in the form of upper bounds on the proportion of the fund invested in any single security. This paper suggests that such problems be re-formulated as parametric linear-programming problems, utilizing a linear approximation to the true (quadratic) formula for a portfolio's risk. Limited empirical evidence suggests that the approximation is acceptable. Moreover, it allows the use of an extremely simple and efficient special-purpose solution algorithm. With appropriate modifications, this algorithm may prove useful to the managers of mutual funds with a wide variety of objectives.
Communications to the Editor—Probability and Rates of Return: Some Critical Comments
Authors: Bernhard Richard H.
Published: November 2008

A recent issue of this journal presents a paper by Professor F. S. Hillier [Hillier, F. S. 1963. The derivation of probabilistic information for the evaluation of risky investments. Management Sci. 9(3, April) 443–457.] in which he develops, under limiting but carefully, stated assumptions, a formal analytic procedure for finding the parameters of a probability distribution of present worth given a known interest rate and probabilistic information about the sequence of cash flows to be discounted. It is the intent of this communication to question the utility of distributions of the internal rate of return given that they have been found.
A Technique for Initializing Exponential Smoothing Forecasts
Authors: Wade Roger C.
Published: November 2008

The purpose of this note is to propose a method for initializing exponential smoothing forecasts when there are no data available prior to the series to be smoothed. It is primarily directed toward computer programs, but is not so involved as to rule out hand operations.
Cluster Analysis in Test Market Selection
Authors: Green Paul E. , Frank Ronald E. , Robinson Patrick J.
Published: November 2008

Selection of “matched” areas for test marketing is an important undertaking if reliable comparisons among markets are to be made. This usually has been done on a rather arbitrary basis, largely because of the large number of market characteristics on which markets can be viewed as similar or different.

The authors suggest a numerical procedure—cluster analysis—for matching prospective test markets on the basis of a large variety of characteristics which could affect test marketing results. In this way, markets can be pre-selected so as to reduce undesired variability among test areas.
Military Essentiality of Naval Aviation Repair Parts
Authors: Denicoff Marvin , Haber Sheldon E. , Varley Thomas C.
Published: November 2008

This paper deals with the problem of ranking items according to their worth, where each item has associated with it a vector of attributes. In particular, a ranking system is developed and tested for aviation repair parts. The objective of the study is to determine whether some items are more important than others for the accomplishment of aircraft missions. If items differ in essentiality, it is important to take such differences into account in providing logistics support. The essentiality ranking is made by generating a vector of attributes for each repair part on the basis of human judgments. These judgments are obtained using a questionnaire which explicitly establishes the ground rules for making attribute assignments. Judgmental priority rules are then applied to the vectors to rank the items. The proposed methodology was tested for four configurations of aircraft. In the course of the study, a wide dispersion in the essentiality of repair parts was found. Of equal significance, a high degree of consistency was also noted among a large number of respondents. The ranking procedure, although designed for military aircraft, has other applications, including commercial ones. Such applications are appropriate whenever budgetary or other considerations require a priority system for allocating resources, e.g., in the procurement and distribution of material stocks including repair parts.