[Verma et al.

, 3(2): February, 2016] ISSN: 2349- 5197

Impact Factor (PIF): 2.138

INTERNATIONAL JOURNAL OF RESEARCH SCIENCE & MANAGEMENT

QUANTITATIVE TECHNIQUES IN BUSINESS
Gaurav verma1*
1*
Assistant professor in mathematics, Gobindgarh public college, Alour, Khanna
Correspondence Author: [email protected]

Keywords: Business, tools, decision making, resources

Abstract
A systematic approach to decision making is complex because today's business and environment in which it is functioning are for
more complex than in the past. For large business a single wrong decision very painful but may also have ramifications in national
economy. The objective of this paper is to discuss the various quantitative techniques and methods used in managerial decisio ns.
Quantitative techniques are very powerful medium through which we solve uncertainty in decision making and enhance
projectability and efficiency in the business. Therefore, these quantitative techniques evaluate planning factors and when these
arise then provide meaningful solution to particular business problem.

Introduction
Quantitative techniques include methods or tools which focus on objective measurement and analyzing numbers in order to draw
conclusion about given problems .It is scientific method or technique used by the business world for problem solving and
decision making . In simple words, these are bunch of those methods and techniques which provide us a decision. The study of
Quantitative techniques has been a new concept which has its wide applications in business and other fields of life. These are
more relevant to problems of complex business situations. These are supplement to judgement and intuition. Quantitative analysis
now extended to several areas which is widely designated as OR, Management sciences, system analysis, decision making process
or decision science and statistical methods etc. Quantitative Technique is a scientific approach to managerial decision-making.
The successful use of Quantitative Technique for management would help the organization n solving complex problems on time,
with greater accuracy and in the most economical way. Today, scientific management techniques are available to solve managerial
problems and use of these techniques helps managers become explicit about their problem areas

Functions of quantitative techniques

The following are the important reasons or functions of Quantitative techniques
1. To facilitate the decision making process.
2. to provide tools for scientific research .
3. To select an appropriate strategy.
4. To help in reduction of cost.
5. To have proper deployment of resources.
6. To help in minimizing the time required for completing the task.

Types of quantitative techniques

There are numerous quantitative techniques are available in modern times. The Following diagram describes some of the
important techniques. Here we discuss

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[Verma et al., 3(2): February, 2016] ISSN: 2349- 5197
Impact Factor (PIF): 2.138

INTERNATIONAL JOURNAL OF RESEARCH SCIENCE & MANAGEMENT

Different types of quantitative techniques

Role of quantitative techniques in business

Solution for various business problems: With increasing competition and scare resources, how manager can increase the profits
of the organization are some examples of problems faced in today’s business. Quantitative Techniques help in the field of
production, marketing, finance and other activities of business. It is answer to such type of problems :
1. How to employ man and machine?
2. How much time customers wait for a service?
3. Can business deliver goods on time?
4. How effectively businesses use its resources?
Thus quantitative techniques provide a scientific base for meeting with uncertainty of future. No doubt, these uncertainties cannot
be eliminated but quantitative techniques help in minimizing problems of the business.
Selection of an appropriate strategy: Every business is having a motive to increase its market share from its competitors by
observing the strategies of the others. So game theory comes handy in this situation where businessman can minimize cost or
maximize profit.
Base for scientific analysis: Quantitative techniques enforce disciplined thinking about organizational problems .They provide
precise description of the cause and effect relationship and risk elimination. Quantitative techniques replace subjective and
intuitive approach with analytical and objective approach.
Reduction in cost and minimizing waiting time: Time is essence in service industry. It is rightly said that a good decision if
taken at right time then outcome of that decision will automatically good. There is gap between service time and capacity so serve.
So queuing theory helps in minimizing waiting time and wastage of resources. It provides a base for businessman to take a correct
and profitable decision.
Proper allocation of resources: Quantitative techniques help in the proper allocation of resources which save time and cost of the
businessman .PERT and CPM is first tool for proper allocation of resources to each and every activity in a proper manner. These
techniques ensure completion of task with in time and with limited resources. These help managers to plan , schedule and control
large and complex projects so resources wastage can e minimized.
Helpful in inventory management: The inventory management is deal with planning and control of inventory in the
organization. If inventory holds for large time and in large quantity then this idle resource and create losses for the organization.
On the other hand, if there is shortage of inventory then it also negative impacts on profitability of the organization. So
quantitative techniques maintain balance between holding the inventory or not. These enables management to decide when to buy
and how much to buy.

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[Verma et al., 3(2): February, 2016] ISSN: 2349- 5197
Impact Factor (PIF): 2.138

INTERNATIONAL JOURNAL OF RESEARCH SCIENCE & MANAGEMENT

Facilities in decision making: Decision making is an essential part of management process. Thus, the decision maker in the
present business must understand the scientific methodology of making decisions. In real life, some decision making situations are
simple while other are not. The decision is multidimensional response which includes production, cost quality, price of the
product etc. The quantitative techniques help in decision making process in the way that identify the factors which influence the
decisions and quantify them. It becomes easier to resolve the complexity of the decision making. Some of the quantitative
techniques such as decision theory and simulation work best in complex decisions.
Useful in production management: Quantitative techniques are useful to the production management due to:
1. Proper plant layout
2. Controlling the production movements
3. Compute the optimum product mix.
So quantitative techniques helpful in planning scheduling and controlling of plant layout and designing of production process.
Helpful in human resource: Human Resource is main asset of the business. Today, It becomes a challenge for business to find
out best talent and how to retain this. Quantitative techniques helpful in studying personal recruitment process, selection criteria,
accident rates and labour turnover etc. These useful to the Human resource management due to following reasons:
1. Proper manpower planning
2. How much work pool needed to cater labour absentism?
3. Routing and sequencing of HR in variety of jobs.
Other benefits: Quantitative techniques equally helpful in marketing and financial management. In marketing management with
the help of quantitative technique we study consumer preferences, sales budget, advertising strategies for increasing market share.
On the other hand, these are useful in financial management where estimate credit and investment risks, optimum replacement
policies and capital requirements etc. Some other Quantitative techniques such as sampling theory helps in taking decision for
whole universe on the basis of sample. In business estimation future planning, regression , correlation, variance analysis, index
numbers and time series analysis are very useful Quantitative techniques.

Conclusion
Therefore, Quantitative techniques are now extended to several areas of business and benefits with quantitative methods is
exhibited in the way problems received and formulated . These techniques are very helpful in tackling the complex problems of
modern business and industry. The tendency of today is to combine several of these techniques and form them into more
sophisticated and advance programming models. Quantitative techniques are become integral part of the modern business.

References
1. Business Statistics by D.R.Agarwal, VRINDA PUBLICATIONS (P) Ltd.
2. Business Statistics by G.C.Beri, Tata McGraw Hill Publishing Company Ltd.
3. Fundamentals of Statistics by S.C.Gupta, Himalaya Publishing House.
4. Business Statistics by S.P.Gupta, Sultan Chand & Sons Educational Publishers, New Delhi.
5. Statistics for Business and Economics by R.P.Hooda, MACMILLAN India Ltd.
6. Quantitative Techniques by C.R. Kothari, Vikas publishing house Pvt. Ltd.
7. Operations Research by S.D.Sharma, KEDAR NATH RAM NATH MEERUT DE

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