Arsi University

School of Graduate Studies

MBA Program (Weekend Program)

Quantitative Analysis for Management Decision Making (MBA 631)

Pre requisites: Management Theories, Preliminary Statistics

Instructor: Mulachew Haile (PhD candidate)

Course Description

Quantitative analysis for management decisions introduces students to a collection of quantitative tools
designed to enhance managerial decision making. It is inevitable for the decisions to be devastating when
made based on poor or inaccurate information. This course is meant to asquint students with tools and
techniques to furnish quantitative information to assist management in making effective decisions. Topics
to be covered include: Decision Making and Decision Theory, Linear programming Models, Integer
Programming, Queuing models, Simulation models, Game theory, Forecasting, Inventory Model, Project
management ( PERT /CPM) & Crashing and others.

COURSE OBJECTIVES:

At the end of this course, students will be expected to:

1. Distinguish between quantitative and qualitative analysis in decision making

2. Be familiar with the mathematical models including an appreciation of strengths and limitations of

each.

3. Recognize a situation in which these models may be effectively applied.

4. Illustrate and demonstrate various models such as Linear & Integer Programming, decision Models,
Queuing, Simulations, network, and Inventory Control model with and without constant demand.

Note: Some of the contents in the course description are going to be covered through group assignments.

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I. Introduction

1.1. Development in Management theory and practice (from scientific management to learning
organizations focusing on Management Science)

1.2. Decision Making & problem solving Process

1.3. Optimization vs Satisfycing to decision making (Article by Herbert . A. Simon)

1.3. Decision Making through quantitative Analysis: Management Science Models

1.4. Review of Probability theory: Bayesian Probability (Independent review to be used in chapter 3)

II. Models and Modeling

2.1. Introduction to modeling

2.2. Variables and objectives

2.3. Influence Diagram: A tool for structuring relation ships among variables

2.4. General Linear Programming Models and Sensitivity Analysis Using Software (Excel solver)

2.4.1. Transportation and Assignment Models using software

2.5. Integer Programming ( Using graphic approach and software)

2.5.1. Pure Integer programming

2.5.2. Mixed Integer Programming

2.5.3. Binary Integer programming

2.5.4. Applications of Integer programming in various areas

III. Decision Making under Risk

3.1. Expected Monetary Values and sensitivity analysis

3.2. Decision Tree and Influence diagram

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 3.2. Decisions with Bayesian Probabilities

3.3. Value of Additional Information

3.4. Efficiency of Sample information

3.5. Solving Decision problems using Software (Tree plan)

3.6. Multi criteria Decisions

IV. Queuing/Waiting Lines Model

4.1. Goal of queuing model

4.2. System Characteristics

4.2.1. Population sources

4.2.2. Number of channels/ servers

4.2.3. Arrival and Service pattern

4.2.4. Queue Discipline

4.3. Measures of system performance

4.4. Queuing Models: Infinite source

Model 1: Single server; Exponential service time

Model 2: Single server; constant service time

Model 3: Multiple channel

4.5. Queuing Models: finite source

4.6. Solving Waiting Lines problem using software (Waiting Line Calculator)

V. Simulation Models

5.1. Advantages and limitations of simulation models

5.2. Steps in simulation models

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 5.3. Monte Carlo Simulation

5.4. Applications of simulation models

VI. Game Theory

6.1. Types of game situations

6.2. Pure strategy

6.3. Mixed strategy

VII. Applications of Management Science Models in business organizations in Ethiopia (Group project: 5
students per group, tentative)

a. Linear programming models

General LP Problems
Transportation and Assignment Models
b. Network models (Project Management Models)
c. Forecasting models
d. Inventory Models
e. Queuing Models
f. Simulation Models
g. Break-Even Analysis

Expectations:

 Each group is expected to produce concise note on respective topic and investigate its
application in one or more of manufacturing and/or service organization(s) in Ethiopia.

 Both hard and soft copy should be submitted as agreed up on schedule and presentation
of the project will be scheduled afterwards.

 Groups will be formed at the convenience of students and by no means are outliers
accepted.

Note: Contents to be covered in class might change as the need arises due to heterogeneous
composition of students in the program.

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 Class policy
1. Attendance:
The class method of teaching assumes that each student has something to contribute and something to
gain by attending class. It further assumes that there is much more instruction absorbed in the classroom
than can be tested on examinations. Therefore, students are expected to attend all regularly scheduled
class meetings and should exhibit good faith in this regard. For the control of absences, the following
regulations are adopted:
* Four absences may result in an automatic failure in the course.
* Three tardy arrivals may be counted as one absence.
2. Statement on Academic Integrity:
Students should not give or receive aid when taking exams, or exceed the time limitations
specified. In seeking the truth, in learning to think critically, and in preparing for a life of
constructive service, honesty is imperative. Honesty in the classroom and in the preparation of
papers is therefore expected of all students. Each student has the responsibility to submit work
that is uniquely his or her own. All of this work must be done in accordance with established
principles of academic integrity.
An act of academic dishonesty or plagiarism may result in failure for a project or in a course.
Plagiarism involves representing another person's ideas, including material from the Internet, as
your own. Cheating or acts of academic dishonesty include (but are not limited to) fabricating
data, tampering with grades, copying, and offering or receiving unauthorized assistance or
information.
3. The Student Conduct Code:
Students will be held to the rules and regulations of the Student Conduct Code as described in
the University’s legislation. In particular, excessive talking, leaving and reentering class, phones
or pagers, or other means of disrupting the class will not be tolerated and students may be asked
to leave. Students who constantly disrupt class may be asked to leave permanently and will
receive an F.
(4) Demonstrate positive interpersonal skills by adhering to the principles of freedom, justice,
equality, fairness, tolerance, open dialogue and concern for the common good.

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Evaluation (Weights are subject for change)

Group Assignment + presentation (Major project) ………………20%

Mini Assignments …………………………………………………………………10%

Mid……………………30% (tentative, may be distributed over Assignment and final exam)

Final………………………………………………………………………………………..40%

References

1. Anderson (2012). Introduction to Management Science: Quantitative Approach to

Decision Making, 2nd edition (Soft Copy to be given by instructor)
2. Williams. J. Stevenson (1992). Introduction to Management Science, 2nd edition
3. Anderson Sweeney and William (1989). An Introduction to management Science:
Quantitative Approach to Decision Making, 5th edition
4. Bernand W. Taylor,III. Introduction to Management Science. 3rd edition, Brown
Publishers
5. J.K.Sharma, (2003). Operations Research, Theory and Applications, 2nd edition, New
Delhi: Macmillan business books.
6. Hamday Hamdy, (1992), Operations Research. An Introduction. 5th edition.
7. V.K.Kapoor, (1991) Operations Research, Problems and Solutions. 1st edition,.
8. Bodily ( ? ): Modern Decision Making: A guide to modeling with decision support system.
McMillan Publisher, India

-----------------Good Luck! -----------------------