The Role of Quantitative Technique that will enable industry/Business organizations gain

Competitive advantage.

The following are the roles:

1.Provide a tool for scientific analysis: These techniques provide executives with a more precise
description of the cause and effect relationship and risks underlying the business operations in
measurable terms and eliminates conventional, intuitive and subjective basis on which
managements used to formulate their decisions in the past.

2.Provide solutions for various business problems: These techniques are being used in the field
of production, procurement, marketing, finance and allied fields. Problems like how best can
the managers and executives allocate the available resources to various products so that in a
given time the profits are maximum or the cost is minimum? Is it possible for an industrial
enterprise to arrange the time and quantity of orders of its stock such that overall profit with
given resources is maximum? How best can the manager determine the number of men and
machines to be employed and used in a manner that neither remain idle and at the same time
the customer or the public will not wait for unduly long for service?.And similar other problems
can be solved with the help of quantitative techniques.

3.Enable proper deployment of resources: Quantitative Techniques like Programme Review and
Evaluation Technique(PERT) helps in proper deployment of resources. PERT enables
organizations to determine the latest finish time for each events and activities thereby helping
in the identification of critical path. It will also enable us deploy resources from one activity to
another to facilitate early completion.

4.It helps in minimizing waiting time and servicing costs: This theory that is queuing theory
helps management in minimizing total waiting time and servicing costs. This technique also
analyses the feasibility of adding facilities and thereby helps businesses to take a correct and
profitable decision.

1. Assists in choosing an optimum strategy: Game Theory is especially used to determine

the optimum strategy in a competitive situation and enables businesses to minimize
losses by adopting optimum strategy. Adopting game theory effectively will no doubt
help organizations gain competitive advantage.

6.They render great help in optimum resource allocation: Linear programming technique is
used to allocate resources in an optimum manner in problem scheduling, product-mix and so
on. In an industry that manufactures different products, application of linear programming will
help the organization to select and manufacture appropriate product-mix that will maximize
their profit at minimum cost.

7.Enable management to decide when to buy and how much to buy. The technique of inventory
planning enables management to decide when to buy and how much to buy. Inventory model
Like EOQ would help to determine quantity of material needed at the lowest cost.

8.They facilitate the process of decision making: Decision theory enables the business
organizations to select the best course of action when information is given in a probabilistic
form. Through decision tree techniques, executives judgment can systematically be brought
into the analysis of problems. Simulation is another important technique used to initiate an
operation or process prior to actual performance. The significance of simulation lies in the fact
that it enables us find out the effect of alternative courses of action in situation involving
uncertainty where mathematical formulation is not possible. Even complex group of variables
can be handled through this technique. Through this technique a random shock that can affect
an organization can be simulated and examined how the organization can cope with the
scenario.

9.Through various quantitative techniques management can know the reactions of the
integrated business systems. The integrated production model techniques are used to
minimize cost with respect to workforce, production and inventory. This technique is quite
complex and is used by companies having detailed information concerning their sales and costs
statistics over a long period. Besides various operation research(O.R) Techniques also help in
management of people taking decisions concerning various problems of business and industry.
The techniques are designed to investigate how system would react to various variations in its
component elements and/or external environmental factors.