Capacity Planning – Meaning, Classification and its Goals
February 12, 2025
April 10th is considered to be “Equal Pay” day all over the world. This day has been commemorated since the year 1996 to remind the world that women are allegedly being paid less than men to do the same amount of work. As per the data from Facebook COO’s non-profit organization, women only receive 80% […]
Living for the Next Quarter Of late, many publicly listed companies have been living “quarter to quarter” or the practice of setting targets, tracking them for progress, and closing out sales and revenue generating items based on the next quarter which is a short term imperative rather than planning for the longer term. This has […]
Much is being said and written about the emerging digital economy with all its promise of techno-utopia and the perils of technology taking control of our lives. Indeed, while some experts have cautioned against surmising that technology would solve all the problems of humankind and lead us into a future of abundance, the mainstream view […]
This module has covered the need for business continuity management as a paradigm to be followed by corporates. This article looks at the pitfalls of not having adequate business continuity management plans in place. First, let us consider the case of Sony where the customer data from its website was hacked. This incident was to […]
How Sports Became Big Business Nowadays, sports mean big bucks for all stakeholders. Whether they are sportspersons, corporates, advertisers, or the sports bodies tasked with administering the game, all of them stand to gain from the infusion of Million Dollar deals that have become the norm rather than the exception. Indeed, the move to make […]
Decision making is crucial for survival of business. Businesses have to make decision considering the limited amount of information. Decision making problems are divided into two types deterministic and probabilistic.
Deterministic model of problem solving depends on the relationship between uncontrollable factors and continuing process of optimizing system performance. A model is developed in under assumption related to existing business condition. If the variables under assumption do not truly reflect the current business conditions, the model developed also will not reflect the reality.
Mathematical optimization utilizes mathematical equation to determine the business decision. The business decision derive is in a numerical form.
A business model for decision making is constructed by analyst based on inputs of a decision maker. A business model is developed over a period of time using a progressive approach method.
Optimization model is developed in three steps, 1st step is describing the problem, 2nd step is elaborating the solution and 3rd step is controlling the problem.
The optimized problem of the 1st step can be classified into linear and non-linear depending upon on nature of variables. Optimization problem has three following aspects:
The solution of optimized problem satisfying all parameters and constraints is referred as feasible solution. The objective of an optimization process is to value of variables, which minimize or maximize objective giving out an optimal solution.
Linear programming is a mathematical procedure of determining linear allocation of business variables. For constructing linear program following factors are essential:
In formulating a linear program certain variables are integer in nature, such as function with integer variable is known as integer programming.
In a certain decision-making process, probability plays an important role. On the decision model based upon probability is decision trees.
Business environment is always unpredictable and can throw up unusual situation more than often. Thus, organizations find themselves in the middle of dynamic environment. Here model and methods like sensitivity analysis, stability analysis, what-if analysis, scenario modeling, etc. is utilized.
Therefore, model under used uncertainties are as follows:
Theory of constraints is a management concept which helps organization deal with situation, which hampers its growth and march towards higher level of performance. Theory of constraint encourages an organization to deal one constraint at a time and consist of following steps:
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