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Quantitative methods in management: Text and cases
164
Book reviews
Phih'ps E. HTCKS lnttodtmtion to Industrial Engineering and Management Science McGraw-Hill, 1977, xiii + 336 pp., DM 49This book is essentially geared to the American, student choice, system of undergraduate education and is designed to accompany an introductory course in industrial engineering, and, one feels, to sell the subject as a field of study. It starts unusually, by devoting two chapters to the history of engineering and of industrial engineering and one chapter to introducing related disciplines including O.R. This historical introduction is followed by four chapters on the present, covering Design and Control of Production Systems, O.R. and Systems, and concludes with a look to the future. Each chapter is selfcontained including a summary, a list of references, and, appropriately for a teaching textbook, a set of review questions and problems. Despite the good basic design of each part I found it a difficult book to review, for several reasons. Firstly, after reading the first five chapters, I was ready to write it off as being, despite its historical introduction, a somewhat superficial introduction to industrial engineering without much relevance to any other subject despite the presence of Management Science in the title. However, although I still believe this to be an accurate judgement on this section, the first five chapters only cover 135 pages. The chapter on Operational Research which follows offers a little more meat but suffers from the common fault of declaring that O.R. is more than techniques while offering only techniques to the reader. ~ae redeeming feature of the book is the long chapter (114 pages) on Systems which occupies onethird of the book. A substantial proportion of this space (90 pages) is occupied by a series of readings in the what would, in much of Europe, probably be classified as O.R. They are all at an elementary level of mathematics and are thus accessible to a wide audience. Yet they represent a wide spectrum of practical OR/SA type work, and as such could have considerable value to many potential and actual students. D.A. CONWA Y The Hatfield Polytechnic U.K.
Paul A. VATTER, Stephen P. BRADLEY, Sherwood C. FREY Jr and Barbara B. JACKSON Quantitative Methods in Management: Text and Cases Richard D. Irwin, Homewood, IL, 1978, xviii + 663 pp., $17~95 These case studies originate in a Managerial Economic course at the Harvard Business School. There are sic broad divisions: decision analysis under uncertainty, judgemental assessment and limited information, historical data as a basis for probabilities, simulation as an aid in decision analysis, competitive reactions/game theory, and allocation of scarce resources. In the first division there are four chapters covering risk, cash flow, decision diagrams, certainty equivalents. The second division includes chapters on probability distributions and Bayes' theorem. The third covers forecasting, time series decomposition and regression analysis. The simulation and games derisions contain single chapters, as does the final division which is restricted to linear programming. All chapters give case studies to enable students to apply in a realistic context the principles covered in the text. The realism extends in some cases to records of meetings, conversations, narrative reports; thus the student is introducted to ill-structured problems and 'noisy' situations. This would be a good text book for introducing graduates from specialist disciplines to problems of management in a postgraduate or 'continuing education' environment. It would also be good for business school undergraduates. It is not however appropriate to the postgraduate who aspires to advance the fiontiers of Operations Research, as basically the book's purpose is to popularize and develop a practical interest in a package of siandard techniques drawn from applied mathematics. Its main weakness, in my (possibly biassed) opinion, is that it fails to develop in the student any feeling for the destabilising effect of technological novelty, which is increasingly at the root of the environment uncertainty with which the manager has to deal. It could be argued that books like this should not be reviewed in Operations Research literature, but rather in the business journals. This would leave space free in the OR literature for looking outwards at the frontiers of technology where applications of novel
Book reviews devices and s./stems in the productive process are continually destabilising the economic system. In the reviewer's opinion, if OR were to reorient itself in this direction, it might recapture some of the excitement of its early years, when its function was to predict the performance of novel hardware under simulated warfare conditions, and subsequently to analyse the aerial performance in a design feedbackloop. Regrettably no leadership in this direction is in sight within the OR camp.
R.H. I¢. JOHNSTON TCD Applied Research and Consultancy Group Dublin, Ireland
S.S. RAO Optimization - Theory and Applications Wiley Eastern Limited, 1978, xiv + 711 pages, £2.95 The book is written as a textbook for a course in optimization methods for engineering students. It assumes that the reader is familiar with general mathematical notation and has a basic knowledge of mathematical analysis. The book covers a wide range of different optimization techniques such as linear programming (the simplex method, revised simplex, duality, decomposition, sensitivity analysis, transportation problems), nonlinear programming (one-dimensional search procedures, unconstrained and constrained optimization techniques), geometric programmhlg, dynamic programming, integer programming, and stochastic programming. The different methods are all followed by examples that show how the methods can be applied to simple engineering problems, and the numerical computations are in most cases shown in detail. The chapters are all followed by a set of problems (without solutions). The descriptions of the methods in the book are easy to understand, but sometimes rather long. However, the book uses too much space on rather old and inefficient methods while new and better methods are not described. E.g. in the chapter on unconstrained nonlinear programming older methods like the simplex method could have been replaced by a more detailed description of new numerically stable implementations of variable metric methods. In the chapter on constrained nonlinear programming the augmented lagrangian method should have been men-
165
tioned, and in integer programming the book only describes cutting plane and implicit enumeration without a word on branch and bound methods that are usually applied in practice. Also, the references are in most cases rather old. The book is, like many other textbooks on optimization, not concerned with the numerical implementation of the algorithms, although this can be very important especially for medium to large scale problems. Summarizing, the book covers a very wide range of different optimization problems, but the choice of techniques has been rather oldfashioned.
Arne DR UD Technical University of Denmark Lyngby, Denmark.
Robert LILIENFELD The Rise of Systems Theory : An Ideological Analysis Wiley, 292 pp., £14.05 Volume 22 of the journal Philosophy o ~ 5Gence (1955) under a heading 'News and Notices' carried a statement from a biologist, an economist, a physiologist and a mathematican which announced that "a Society for the Advancement of General Systems Theory (GST) is in the process of organisation". The main purpose was to be the encouragement of "the development of theoretical systems which are applicable to more than one of the traditional departments of knowledge". The first aim of the new Society was to be "to investigate the isomorphy of concepts, laws, and models in various fields and to help in useful transfers from one field to another". The pioneers were intrigued, for example, by the fact that such different phenomena as the growth of the scientific literature, the progress of a self-catalysing chemical reaction and the loss of weight of a starving rat may all be summarised in the same mathematical expression. They envisaged a meta-theory in whose langhage the problems and puzzles of the different disciplines might usefully be expressed. Twenty-five years later we may ask: what are the achievements of the movement whose birth was signalled by the announcement from Bertalanffy, Boulding, Gerard and Rapoport? No one could claim that they are considerable We always pay for generality with lack of content, and the overarching theory imagined by these pioneers has been slow to emerge. Nevertheless, the Society
Book reviews
Phih'ps E. HTCKS lnttodtmtion to Industrial Engineering and Management Science McGraw-Hill, 1977, xiii + 336 pp., DM 49This book is essentially geared to the American, student choice, system of undergraduate education and is designed to accompany an introductory course in industrial engineering, and, one feels, to sell the subject as a field of study. It starts unusually, by devoting two chapters to the history of engineering and of industrial engineering and one chapter to introducing related disciplines including O.R. This historical introduction is followed by four chapters on the present, covering Design and Control of Production Systems, O.R. and Systems, and concludes with a look to the future. Each chapter is selfcontained including a summary, a list of references, and, appropriately for a teaching textbook, a set of review questions and problems. Despite the good basic design of each part I found it a difficult book to review, for several reasons. Firstly, after reading the first five chapters, I was ready to write it off as being, despite its historical introduction, a somewhat superficial introduction to industrial engineering without much relevance to any other subject despite the presence of Management Science in the title. However, although I still believe this to be an accurate judgement on this section, the first five chapters only cover 135 pages. The chapter on Operational Research which follows offers a little more meat but suffers from the common fault of declaring that O.R. is more than techniques while offering only techniques to the reader. ~ae redeeming feature of the book is the long chapter (114 pages) on Systems which occupies onethird of the book. A substantial proportion of this space (90 pages) is occupied by a series of readings in the what would, in much of Europe, probably be classified as O.R. They are all at an elementary level of mathematics and are thus accessible to a wide audience. Yet they represent a wide spectrum of practical OR/SA type work, and as such could have considerable value to many potential and actual students. D.A. CONWA Y The Hatfield Polytechnic U.K.
Paul A. VATTER, Stephen P. BRADLEY, Sherwood C. FREY Jr and Barbara B. JACKSON Quantitative Methods in Management: Text and Cases Richard D. Irwin, Homewood, IL, 1978, xviii + 663 pp., $17~95 These case studies originate in a Managerial Economic course at the Harvard Business School. There are sic broad divisions: decision analysis under uncertainty, judgemental assessment and limited information, historical data as a basis for probabilities, simulation as an aid in decision analysis, competitive reactions/game theory, and allocation of scarce resources. In the first division there are four chapters covering risk, cash flow, decision diagrams, certainty equivalents. The second division includes chapters on probability distributions and Bayes' theorem. The third covers forecasting, time series decomposition and regression analysis. The simulation and games derisions contain single chapters, as does the final division which is restricted to linear programming. All chapters give case studies to enable students to apply in a realistic context the principles covered in the text. The realism extends in some cases to records of meetings, conversations, narrative reports; thus the student is introducted to ill-structured problems and 'noisy' situations. This would be a good text book for introducing graduates from specialist disciplines to problems of management in a postgraduate or 'continuing education' environment. It would also be good for business school undergraduates. It is not however appropriate to the postgraduate who aspires to advance the fiontiers of Operations Research, as basically the book's purpose is to popularize and develop a practical interest in a package of siandard techniques drawn from applied mathematics. Its main weakness, in my (possibly biassed) opinion, is that it fails to develop in the student any feeling for the destabilising effect of technological novelty, which is increasingly at the root of the environment uncertainty with which the manager has to deal. It could be argued that books like this should not be reviewed in Operations Research literature, but rather in the business journals. This would leave space free in the OR literature for looking outwards at the frontiers of technology where applications of novel
Book reviews devices and s./stems in the productive process are continually destabilising the economic system. In the reviewer's opinion, if OR were to reorient itself in this direction, it might recapture some of the excitement of its early years, when its function was to predict the performance of novel hardware under simulated warfare conditions, and subsequently to analyse the aerial performance in a design feedbackloop. Regrettably no leadership in this direction is in sight within the OR camp.
R.H. I¢. JOHNSTON TCD Applied Research and Consultancy Group Dublin, Ireland
S.S. RAO Optimization - Theory and Applications Wiley Eastern Limited, 1978, xiv + 711 pages, £2.95 The book is written as a textbook for a course in optimization methods for engineering students. It assumes that the reader is familiar with general mathematical notation and has a basic knowledge of mathematical analysis. The book covers a wide range of different optimization techniques such as linear programming (the simplex method, revised simplex, duality, decomposition, sensitivity analysis, transportation problems), nonlinear programming (one-dimensional search procedures, unconstrained and constrained optimization techniques), geometric programmhlg, dynamic programming, integer programming, and stochastic programming. The different methods are all followed by examples that show how the methods can be applied to simple engineering problems, and the numerical computations are in most cases shown in detail. The chapters are all followed by a set of problems (without solutions). The descriptions of the methods in the book are easy to understand, but sometimes rather long. However, the book uses too much space on rather old and inefficient methods while new and better methods are not described. E.g. in the chapter on unconstrained nonlinear programming older methods like the simplex method could have been replaced by a more detailed description of new numerically stable implementations of variable metric methods. In the chapter on constrained nonlinear programming the augmented lagrangian method should have been men-
165
tioned, and in integer programming the book only describes cutting plane and implicit enumeration without a word on branch and bound methods that are usually applied in practice. Also, the references are in most cases rather old. The book is, like many other textbooks on optimization, not concerned with the numerical implementation of the algorithms, although this can be very important especially for medium to large scale problems. Summarizing, the book covers a very wide range of different optimization problems, but the choice of techniques has been rather oldfashioned.
Arne DR UD Technical University of Denmark Lyngby, Denmark.
Robert LILIENFELD The Rise of Systems Theory : An Ideological Analysis Wiley, 292 pp., £14.05 Volume 22 of the journal Philosophy o ~ 5Gence (1955) under a heading 'News and Notices' carried a statement from a biologist, an economist, a physiologist and a mathematican which announced that "a Society for the Advancement of General Systems Theory (GST) is in the process of organisation". The main purpose was to be the encouragement of "the development of theoretical systems which are applicable to more than one of the traditional departments of knowledge". The first aim of the new Society was to be "to investigate the isomorphy of concepts, laws, and models in various fields and to help in useful transfers from one field to another". The pioneers were intrigued, for example, by the fact that such different phenomena as the growth of the scientific literature, the progress of a self-catalysing chemical reaction and the loss of weight of a starving rat may all be summarised in the same mathematical expression. They envisaged a meta-theory in whose langhage the problems and puzzles of the different disciplines might usefully be expressed. Twenty-five years later we may ask: what are the achievements of the movement whose birth was signalled by the announcement from Bertalanffy, Boulding, Gerard and Rapoport? No one could claim that they are considerable We always pay for generality with lack of content, and the overarching theory imagined by these pioneers has been slow to emerge. Nevertheless, the Society