operational analytics overview
TRANSCRIPT
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Operational Analytics- An Over ViewBY PRUDHA PALLAVI PENTAPATI
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Descriptive Analytics
What is a fundamental Operational Problem? Time line of events
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Steps before the Solution
Analyse the past data How much should you order News Vendor Problem Time’s Magazine Aprroach Broader application to the problem
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Forecasting
What is Forecasting? Characteristics of Forecasts Probablity Distributions in Forecasting Model for future Demand
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Making Best decisions with low uncertainity
A resource allocation Example Converting a verbal problem application into an algebraic model Algebraic model to spreadsheet implementation Matching demand and supply across space
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Decision Variables
What are decision variables? Optimizing Production Build an Objective Function Working around constraints How to Identify Key Performance Indicators
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Risk and Evaluation of Alternatives
Making Decisions in Low-Uncertainty vs. High-Uncertainty Settings
Connecting Random Inputs and Random Outputs Modeling Random Variables using Scenarios
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Decision Trees
What is a decision tree Structure of a decision tree Understanding a decision tree
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Approach to Evaluate Options using Decision Trees
“Maxi-min” strategy Choose the actions that maximize the minimum outcome Avoids bad outcomes…and…ignores the possibility of good outcomes “Risk averse” strategy
“Maxi-max” strategy Choose the actions that maximize the maximum outcome Seeks good outcomes...and…ignores the possibility of bad outcomes “Risk seeking” strategy
Maximize the expected value of the outcomes Gives equal weight to good and bad outcomes “Risk neutral” strategy
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Decision Trees in Practice
IDEA is a small example designed to convey the essential ideas In practice, decision trees are used to evaluate a wide range of
complex problems. You can find examples in articles published in Interfaces m R&D licensing
Credit Scoring ,Polio Eradication There exists software to help manage and analyze large decision
trees m core-feature, single user, products: e.g., Tree Plan (free trial) massive-feature, enterprise-use products: Decision Tools, Logical Decisions