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Minimize your wastes
Maximize your profits
An Introduction to Advanced Analytics
Dr. Kerem Akartunali
Dept. of Management Science
What we will see today...
• What is advanced analytics?
• What is optimization?
• Examples from:
– Manufacturing.
– Transportation.
– Medicine.
• What’s next?
Problems from Real World• We have systems.
– People, vehicles, machines, ...
– Interaction between these.
• We have aims/objectives.
– Maximize profit, satisfied customers, ...
– Minimize waste, travel time, ...
– Understand our capabilities, ...
• We make decisions.
Use Advanced Analytics
• Operational Research: “Science of Better”
– Apply advanced analytical methods to help make better decisions.
• Less risk.
• Better outcomes.
– Theory, modelling, application.
– More to read at:
http://www.scienceofbetter.org/
Different Names, Common Goal
• Advanced Analytics.
• Operational Research.
• Management Science.
• Decision Support.
– Understand your system better!
It is fascinating...
• Very fast developments in IT.
– More capable computers.
– Specialized software.
• 60+ years of knowledge.
– Started with a military project during WW2.
– Lots of applications in various areas.
• We can tackle hard problems!
Today: Intro to Optimization
• One big family of advanced analytic techniques.
• Given a system.
– Limitations/constraints.
– Objectives/aims.
• What is the best solution(s)?
– Any/Good enough solutions?
Toy Example: Production Line
• Constant daily demand of 100 units.
• Fixed batch cost £8.10.
• Holding cost per unit £0.20.
• How many units per batch? Decision!
Toy Example (cont’d)
• Cost = Fixed cost + Holding cost
• When do we minimize this?
Look where the slope is 0:
Production Planning
• A number of products and components.
• Capacitated resources.
– Processing and setup times.
• Fluctuating demands.
• Limited inventory stocking.
• What are our decisions?
Production Planning Solutions
• Very complicated problems to solve.
– Many 0/1 decisions.
– Products competing for resources.
• Advanced analytical methods proven to be very useful:
– ‘Cutting planes’ from smaller problems.
Solution qualitiesimprove 20%-70%!
Solution timesless than 50%!
Manufacturing Success Story
• Samsung Semiconductor Manufacturing
– Expected sudden price fall for Dynamic Random Access Memory Devices (DRAM).
– Huge work-in-process inventory.
• Solution: Smarter factory floor scheduling & optimized capacity use.
– Cycles times down, $1BN sales.
Optimizing Airline Operations
• Very large-scale and complex.
– Sequence of decision problems built.
• Airline timetable.
• Fleet assignment.
• Aircraft routing.
• Crew scheduling.
– Recent attempts of integrations.
Timetabling & Fleet Optimization
• Key questions:
– Optimal mix of aircraft.
• Strategic decision.
– Timetable to be flown.
• Significant effect on operations.
• A wide array of input data.
– Customer demand, airport and crew limitations, maintenance, ...
Timetabling Solutions
• These problems considered to be too complicated to solve for decades.
– Advanced analytics can at least tackle these now!
• Decomposition techniques.
• Heuristic methods.
– Significant savings potential.
Airlines Success Story
• Air New Zealand & University of Auckland collaboration 1986-1999.
– Continuous plug-ins on the crew scheduling optimization system.
– Tours of duty and rostering planning.
– Estimated annual savings of NZ$15M.
Radiation Therapy Optimization
• Patient lying on bed.
• Ionize radiation to tumor (360o).
– To kill it, a minimum amount is required.
• Issues:
- Organs and healthy tissue!
- Limited treatment time.
Radiation Therapy: View
• Multileaf collimator with ‘leaves’.
• Body divided into 3-D ‘voxels’.
• Different angles = different dose.
Radiation Therapy Problem
• Data generated from scans fairly easy.
• Complications:
– How hard are our constraints?
– Nonlinear dose quantities on voxels.
• Solutions:
– Penalizing soft constraints.
– Linear approximation of dose.
Endless Problems to Analyse
• Agriculture.
• Broadcasting.
• Finance.
• Military.
• Sports.
• Waste collection.
• ...
It’s not just optimization!
• Simulation and System Dynamics.
• Risk and Reliability Analysis.
• Probability and Statistics.
• Data Mining.
• Supply Chain Management.
• Problem Structuring.
Invest in your future….• Develop talented employees.
• We offer innovative online CPD modules that staff can complete alongside their existing duties.
• We are Scotland’s leading Business School and were rated ‘Excellent’ in recent Teaching & Quality Assessments.
Consultancy & Knowledge Exchange
• If you have a problem that requires specialist expertise, contact us to find out how we can help.
• MSc Student Projects.
• Individual consultancy projects.
To find out more…
• Contact:
• Dr. Kerem Akartunali –[email protected]
• Mr. Dominic Chalmers –[email protected]