3
Decision-making
In order for a company to turn a profit, it needs to operate efficiently and
contain costs.
The following methods can be used to efficiently make decisions that solve
problems.
Inefficient
Corporate and legal affairs
Work methods (Cause)
Chapter 1
(1)Cause and effect diagram
A “cause and effect diagram” maps the effects (results) that are creating
work problems along with the apparent causes (factors) that relate to them
in a diagram that resembles a fish’s skeleton. It is also referred to as a
“fishbone diagram.” It is useful for laying out and summarizing multiple
causes.
For example, in the diagram here, the causes that have led to a degradation
in quality have been laid out as a system of four factors (work methods,
materials, machinery, and staff), and this makes the relationship among
factors evident.
Materials (Cause)
Rejects
Quality degradation (Effect)
Deterioration
Equipment (Cause)
Negligence
Breakdowns
Short-staffing
Staff (Cause)
(2)Simulation
A “simulation” is an experiment that mimics actual circumstances based
on a realistic prediction of conditions.
The methods for conducting simulations are summarized below.
●Linear programming
“LP (Linear Programming)” is a model used for a particular kind of
problem-solving, finding the most effective way to allocate resources under a certain set of constraints.
●Queueing theory
“Queueing theory” is a model for analyzing customer waiting-time and
line length in service situations such as bank-teller windows, based on customer arrival time, the number of windows, and average service duration.
Waiting period and the number of people in line can be expressed as an expectation value.
(3)Inventory control
Inventory control is the foundation of business management for a company.
If inventory is excessive or inadequate, supply and demand go out of balance, and too much inventory puts pressure on all the company’s resources, increasing costs. This makes it especially important to maintain appropriate inventory levels as part of inventory control.
The methods for inventory control are summarized below.
Reference
LP
Abbreviation for “Linear Programming.”
Reference
Expectation value
An “expectation value” is the average
value that is obtained after multiple trials. For example, rolling dice some
number of times can be expected to
produce an average value.
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