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EV EVOL OLVE VE GRE GREATER TER MA MANC NCHE HESTE STER Frida Friday 13 13th

th June,

June, 2014 2014

How Operational Research can improve your organisation’s decision making

Graham Rand Jane Parkin Felicity McLeister

For more information Email felicity.mcleister@theorsociety.com

An obvious question– what is Operational Research?

• Sometimes known as Management Science,

OR/MS or MS/OR

• Called Operations Research in some countries
• "OR is the application of objective methods to

complex problems arising in the direction and management of large systems of people and resources faced by industry, the public sector and

• ther organisations."
• "The purpose of OR is to enable managers to

make more effective decisions."

For more information Email felicity.mcleister@theorsociety.com

How does O.R. help managers make better decisions?

By using techniques such as problem structuring methods and mathematical modelling to analyse complex situations, operational research gives those who run

• rganisations the power to make more effective decisions

and build more productive systems based on:

• More complete data
• Consideration of all available options
• Careful predictions of outcomes and estimates of risk
• The latest decision tools and techniques

For more information Email felicity.mcleister@theorsociety.com

What types of problem?

• Decision to be made
• Choices of action
• Significant effect
• not worthwhile for trivial decisions
• Suitable client
• willing to consider recommendations
• able to carry them out

For more information Email felicity.mcleister@theorsociety.com

Strategic "one‐off" decisions

Examples

• Warehouse layouts
• where should my products go?
• aim – minimum work
• Relocating offices
• to where should we move?
• aim ‐ minimum cost, minimum travelling time for

staff

• Characteristics
• important to get right!
• costly to reverse
• Output – recommendations

For more information Email felicity.mcleister@theorsociety.com

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“Tactical" not strategic decisions

Examples

• Inventory management
• what to buy, how often, where to put it, etc.
• Allocating grants
• how to design the scorecard
• Characteristics
• about processes ‐ not one‐off decisions
• Output
• probably recommendations
• possibly also a computer system for future situations

For more information Email felicity.mcleister@theorsociety.com

Extremely detailed issues

Examples

• University timetabling
• what is taught when, where, by whom to whom
• aim – high quality of education
• Organising appointments
• matching providers and clients, at specific times
• aims – good match, minimum wasted time
• Characteristics
• best possible solution not vital ‐ good enough will do
• not clear what "best" means anyway
• Output – computer systems
• for use by technical person – maybe the developer

For more information Email felicity.mcleister@theorsociety.com

Providing good information

Examples

• Keeping track of performance
• collecting measurements and using them to

highlight changes

• Forecasting market share for a new service provision
• maybe after 6, 12, 24 months
• Characteristics
• not recommending action but providing a system
• an aid to future decisions
• Output
• a computer system for client's use

For more information Email felicity.mcleister@theorsociety.com

So what does an OR problem‐solving approach consist of?

• Problem structuring, formulation
• always
• Data gathering/analysis
• sometimes
• Helping managers to understand
• this may be all that's required
• Producing computer systems
• quite often
• Most OR involves MODELLING
• quantitative or qualitative

For more information Email felicity.mcleister@theorsociety.com For more information Email felicity.mcleister@theorsociety.com

Models: thinking through consequences, "reflection before action"

OK to "suck it & see" for simple issues. Rather disastrous for complex issues and designs

Alternatives to modelling

• Do nothing
• Seat of the pants (intuition)
• Experiment on the real system
• Cost
• Time
• Danger

For more information Email felicity.mcleister@theorsociety.com

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Hard or Soft OR ?

• Soft OR ‐ qualitative, subjective
• less prescriptive, more descriptive
• help stakeholders see the issues more clearly
• facilitation rather than recommendation
• usually the start of any project
• Hard OR ‐ quantitative, objective
• measure what you can
• may have to ignore what you can't
• make specific recommendations
• Many projects combine the two approaches

For more information Email felicity.mcleister@theorsociety.com

O.R for the Third Sector

Some of the problems third sector organisations are faced with:

• ‘We have lots of different options for the future but it’s

impossible to decide which to choose in such uncertain times.’

• ‘We’re under huge pressure to do more with less, and we

don’t know how we’re going to do it.’

• ‘It’s hard to stay objective when we’re faced with such

emotionally charged decisions.’

• ‘We know we’re doing a good job – but how can we prove

it?’ We felt that O.R. could help and set up Pro Bono O.R.

For more information Email felicity.mcleister@theorsociety.com

Pro Bono O.R.

• Set up as a service to third sector organisations by

The OR Society

• ‘provides some of the head to your
• rganisation’s heart’
• Some organisations we have helped:

For more information Email felicity.mcleister@theorsociety.com

Some comments from clients

• “We’ve benefited hugely from your work and support in all

areas of the project, and from an organisational perspective you’ve enabled us to take a highly professional approach to increasing the efficiency of our charity”

• ‘The work is already supporting our planning and development

for next year and allowing us to focus our thoughts and decisions on the places of most importance for our

• rganisation’
• “Resource planning has been a stumbling block for years. As a

new CEO I know how important it is to motivate staff and a key part of that was re‐thinking how we plan our services.”

For more information Email felicity.mcleister@theorsociety.com

Example 1: Crimestoppers

Help police solve and prevent crime In 2011/12:

• Received 95,276 calls and online forms
• with useful information
• Resulted in:
• 8,097 criminals arrested and charged
• £22,340,328 worth of illegal drugs seized
• £7,723,373 worth of stolen goods recovered

Expecting 60% increase in business but no more funds available for staffing call centre

For more information Email felicity.mcleister@theorsociety.com

Simulation Model using current shifts

For more information Email felicity.mcleister@theorsociety.com

Target: 90% of calls to be answered in 20 seconds

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For more information Email felicity.mcleister@theorsociety.com

Modelling alternative shift patterns

Results for an average week

Alternatives modelled 1 CS initial proposal ‐ longer shifts 2 as 1 with some part time weekend shifts added 3 as 2 with amendments to weekend shifts 4 as 3 but extending one shift 5 as 4 but changing start times for early shifts

Implementation

New shift patterns introduced Jan 2013 January performance compared to 2012 average

• Service levels increased
• From 90% to 94%
• Abandoned calls decreased
• From 12% to 6%
• Average time to answer call decreased
• From 28 secs to 13 secs

“We are grinning like Cheshire cats and I wanted to share the good feeling with you both. Thank you for all your efforts – I feel now it really was worth it.” (Performance Manager)

For more information Email felicity.mcleister@theorsociety.com

Example 2: Reach

The client: Reach: an organisation matching skilled volunteers to charities that need them The problem: to improve the efficiency and effectiveness of matching processes, free up resource, develop more value adding activities The approach: we

• interviewed staff
• facilitated focus groups of matching staff and IT support
• work shadowed a ‘matcher’ and the Foundation Services Co‐ordinator
• discussed potential measures of impact with Research and Business

Analysis Manager

• examined available documentation, collated and distilled the

information

• discussed issues identified with a process improvement expert

For more information Email felicity.mcleister@theorsociety.com

The Solution

• Identified short term efficiency

improvements

• Recommended additional value

adding activities

• Identified ways of measuring impact
• Recommended a roadmap for

moving to a new service delivery model

The benefits

• A new perspective on processes,

helping develop, challenge and validate internal thinking

• Skilled staff freed up to deliver more

value

• Reach services better targeted and marketed,

through improved impact measurement For more information Email felicity.mcleister@theorsociety.com

What happens next?

• Expression of interest.
• Registration form.
• Speak with O.R. specialist to discuss if there is a

potential project.

• Project scope sent to volunteers.
• Organisation selects volunteer.
• Project proposal drawn up.
• Project commences.
• Feedback sought.

For more information Email felicity.mcleister@theorsociety.com

For more information

Webpage: www.theorsociety.com/Pages/Probono/Probono.aspx Blog: http://probonoOR.blogspot.co.uk/ @FMcLeister Felicity McLeister I look forward to hearing from you.

For more information Email felicity.mcleister@theorsociety.com