INDIAN INSTITUTE OF MANAGEMENT NAGPUR

Mathematical Modeling for Managerial Decisions

PGP-II, Term VI

Instructor:
Sachin Jayaswal, Indian Institute of Management Ahmedabad
Contact: +91-79-6632 4877, sachin@iima.ac.in
www.iima.ac.in/~sachin

Course Description & Objectives: Operations Research (OR)/ Management Science (MS) is an applied subject.
Though there are many useful underlying theories, which are important to know, the main strength of the subject lies in
its ability to solving real-world practical problems. Journals in Operations Research/Management Science (OR/MS),
especially Interfaces, document success stories of mathematical programming models and OR/MS techniques in
solving real world complex decision problems. One estimate puts the amount of savings every OR/MS project
achieves at either 40 million dollars, or 30 percent of the total project cost, whichever is greater. It is clear, even though
the savings reported are often exaggerated, that there are tremendous savings possible in many areas by adopting a
formal, mathematical, decision making process for managerial decisions. The objective of this course is to train
participants in the use of mathematical models to model real-world managerial problems, and to use OR/MS tools to
solve them. This will be done through modeling real-world problems, drawn from diverse areas of management:
Product Line Design from Marketing; Paper recycling from Public Systems; Disentangling bankruptcies and
Investments for electricity generation from Finance; Product line design from Marketing; Supply chain network
design, Supplier selection, Aggregate production planning, Assembly line balancing, Job scheduling, Freight allocation
problem, and Milk collection from Operations/Logistics & Supply Chain; Bandwidth packing and Selecting
Telecommunication carriers from Telecommunication. To this end, each session will typically begin with a discussion of
a complex real-world business/management problem, as reported in journals like Interfaces, European Journal of
Operational Research, Management Science, Operations Research, Marketing Science, and will close with a
mathematical model and the optimal solution for the problem discussed. Wherever possible, emphasis will be on
arriving at alternate mathematical models for the same problem, and to show how/why one is computationally better
than others, especially when the model exceeds the solver’s capability. The course will also introduce AMPL (A
Mathematical Programming Language) that will be especially useful for solving real-world models involving thousands
of variables/constraints. An important component of the course is group assignments/prject in which participants will
have the opportunity to apply their learnings from the course.

Grading Components:
Class Participation: 25%
Group Assignments: 35%
Project: 40%
 Session Plan

Session Coverage

1&2 Introduction to Problems; BlueSky Airline: Network Revenue Management

3&4 Paper Recycling + Introduction to AMPL for Paper Recycling

5&6 Workforce Scheduling + extensions to Min Max; Min Sum; NLP versus LP
7 Distribution at Food Corporation of India

8 Motorola Supplier Selection

AmazingDeal.com: Supply Chain Network Design + Variants: Set Covering; Maximal

9&10
Covering; Fixed Charge; Diepersion Model

11 Freight Allocation with lane cost balancing

12&13 Map Coloring

14 Assembly Line Balancing

15 Product Line Selection

16 Job scheduling
17 Project Crashing

18 Aggregate Production Planning for Red Tomatoes

19 Mining Problem
20&21 Hub and Spoke Network Design

22&23 Milk Collection: TSP

24&25 Project Presentation