FAQs About O.R. & Analytics

FAQs About O.R. & Analytics 

1. What are O.R. and analytics?
2. What kinds of problems do operations researchers work on?
3. How do operations researchers arrive at their solutions? 
4. What are examples of uses of operations research and analytics?
5. What are operations research and analytics? What is management science?
6. Should I consider a career in operations research/analytics?
7. What are the trends for a career in the field of operations research and analytics?
8. What are the employment and salary prospects for operations researchers? 
9. What kinds of opportunities for advancement are there?
10. What education does an O.R./analytics professional need?
11. What skills do operations researchers need?
12. Where can I get the preparation I need to work in operations research and analytics? 
13. How can students interested in operations research find out more? 
14. What's it like to work in operations research?
15. What if I don’t know what career I want yet?
16. Where can I get more information?
17. What is INFORMS?

Q1. What are O.R. and analytics? 

The field of operations research (O.R.) began in the 1940s as mathematicians developed techniques for practical problem solving. Today, O.R. is the application of advanced analytical methods to help make better decisions. Closely connected to O.R., analytics is the scientific process of transforming data into insight for making better decisions. Both offer exciting ways to apply math methods to real-world situations and everyday decision making.

• Websites like LinkedIn and Google use O.R. and analytics to make behind-the-scenes connections among personal profiles. Tech companies like IBM, Intel, and HP use O.R. and analytics to strengthen management, improve the way they manufacture, and reduce resource use – all to create less expensive computers and smartphones.
•  The U.S. Army uses O.R. and analytics to plan the delivery of supplies and to fight terrorism.
• Airlines use O.R. and analytics to schedule your flight crew and your flight, to protect passengers, and to set prices.
• Humanitarian relief agencies use O.R. and analytics to plan for disasters and, when disaster strikes, to rush food and medicine to those in need.
• Organizations of every type use O.R. and analytics to attack problems with lots of choices and even more data to come up with optimal solutions.
• Other areas:
  • Healthcare
  • Sports
  • Social media
  • Environmental work
  • Product development
  • Advertising/marketing
  • Decision making
  • Logistics 

Math methods in O.R. and analytics are ways to formulate and solve problems. Methods are designed to take advantage of the type of problem to find solutions quickly, effectively, and efficiently.

Math methods for O.R. and analytics include tools to handle the following:

• Big data: Storing, integrating, analyzing, updating, and using huge amounts of data in real time.
• Real time: Updating solutions quickly when new information becomes available.
• Decision making: Framing a decision problem and choosing the best option.
• Networks: Network analysis can be used to study the links between people, how information propagates in a social network or social media (like Twitter), or how to schedule network routes for airline fleets or police patrol cars.
• Optimization: Math methods to find the best solution to a particular type of problem, e.g., mathematical programming models (e.g., linear programming, stochastic programming, nonlinear programming). Optimization focuses on finding the best solution to meet desired criteria. What's the best stock portfolio for a conservative investor? How should timber of varying diameter be cut to maximize profits? How many and what type of cameras should be produced for the next holiday gift-giving season to maximize sales, profits, and customer satisfaction. 
• Probability theory and stochastic processes:How to represent uncertainty and to analyze uncertain events. “Stochastic” means that a process is random. Stochastic modeling is the application of probability theory to complex models. An operations researcher might forecast personnel requirements over a five-year period.
• Queueing theory: The theory and analysis of waiting lines. From an O.R. perspective, queueing theory is managing the flow of people or goods in the most efficient manner, given limited resources. For example, some characteristics of a waiting line might be known—how many people arrive on average per hour, how long on average it takes to serve a person—but the number of people in line at a specific time in the future is not known exactly. Queueing theory is what Walt Disney World uses to keep the lines moving at Space Mountain and Mr. Toad's Wild Ride and how TV newsrooms decide how many editors they'll need to stay on deadline. 
• Computer simulations:  Computer models that represent a process over time, based on the probability that events will happen and based on different decision policies. With displays that you might compare to video games, computer simulations show how systems perform under different conditions and allow users to test various ways to model a system or possible approaches to a problem.

Q1a. What is logistics? 

Logistics is getting the right things to the right places at the right times. Operations research and analytics have developed many math-based tools for doing this quickly, efficiently, and flexibly in industry, business, government, and military applications. Logistics is the management of the flow of people, supplies, or resources over time between origins and destinations. Logistics applies to delivery of packages and freight delivery of cargo, groceries, crops, and manufactured goods. It also applies to schedules for passenger transportation, medical supplies, and emergency relief.

Q1b. What is “big data”? 

“Big data” refers to the enormous amount of data now being generated, from multiple sources, in all languages, in all countries, across the world. There is an ever-increasing amount of data. Operations research and analytics are used to develop methods to effectively use and analyze big data.

There are traditional, structured sources like scientific studies and surveys, and there are unstructured data like online reviews, blogs, chat rooms, Twitter, website visits, purchasing data, and public records. And there are huge ongoing scientific studies in astronomy, physics, weather and climate, and genetics and biology. There are text and visual data, in multiple formats, and often in enormous, growing data sets on many servers (“in the cloud”).

Multiple analytics methods are used to represent and use such data, including math modeling and O.R. methods, statistics, graphics, and interactive visualizations. Model results may be updated quickly based on new data, e.g., recommendations for purchases, search optimization engines, online ad placement, individually tailored ads, and marketing flyers.

Q2. What kinds of problems do operations researchers work on?

Every day, operations researchers help make critically important decisions that affect the success of major corporations and the policies of local, state, and national governments around the globe. The problems they tackle usually involve designing systems to operate in the most effective way or deciding how to allocate scarce human resources, money, equipment, or facilities.

• Suppose, for example, your manufacturing firm has come up with a remarkable new device. When and how should you market it to make device users everywhere sit up and take notice?
• Suppose you're a fire chief in a medium-sized city. Will relocating some of your present stations reduce your response time? And how much will that save in terms of lives and property?

As an operations researcher, your job would be to determine the various alternatives that are available — and then to carry out an analysis that would enable you to assess them objectively and recommend the most suitable one.

Depending on your area of specialization - in industry, government, or international relations - you might also be asked to help answer complex questions like...

• What are the most cost-effective precautions to reduce the occurrence and environmental impact of oil spills?
• How many elevators should be installed in a new office building to cut waiting time? What can a business do to decrease the dissatisfaction of people who have to wait for service? (The answer may surprise you.)
• How often should check-ups be scheduled for members of a group health plan, and what should be included?
• How long should the warranty on an automobile or appliance run, what should it cover, what will it cost the manufacturer, and how will it impact customer satisfaction and loyalty?
• How can a dress manufacturer lay out its patterns to minimize wasted material (thus reducing costs) so that it can use the savings to be able to produce more new fashions more frequently?
• How often should the sales force of a frozen yogurt company call on its customers?
• What's the most efficient method for routing a long-distance telephone call?
• What changes in water-treatment capabilities and locations will be needed to serve the population in a country in the year 2025?
• How should a hospital health system plan the services, locations, and capacity for the year 2025?
• How do social media work in different countries on spreading news of weather emergencies, travel disruptions, or health alerts?

Q3. How do operations researchers arrive at their solutions?

The field of operations research has developed a number of mathematical methods and tools. In undergraduate and graduate courses, O.R. students learn to analyze problems and break them down into components that can be solved mathematically. They also learn how to use computer modeling as a problem-solving tool and which models and techniques are appropriate for different kinds of problems. Some methods and tools are categorized by the structure of the problem; some are tailored to an application area. Real-world problem solving generally requires both: understanding what the problem is really about and then identifying the solution methods best suited for the specific application.

Most solutions involve a combination of methods, and operations researchers figure out how they all fit together.

Q4. What are examples of uses of operations research and analytics?

View examples of operations research from the INFORMS Edelman competition

Watch operations researchers explain what they do

Read more examples of the way that organizations use O.R. and analytics.

Q5. What are operations research and analytics? What is management science?  

Operations research is a scientific approach to analyzing problems and making decisions.

• It uses mathematics and mathematical modeling on computers to forecast the implications of various choices and zero in on the best alternatives.

• Developed during World War II, O.R. helped take the guesswork out of deploying radar, searching for enemy submarines, getting supplies where they were most needed, and the like. After the war, numerous peacetime applications emerged.

• Manufacturers used O.R. to make products more efficiently, schedule equipment maintenance, and control inventory and distribution. Success in these areas led to expansion into strategic and financial planning and into such diverse areas as criminal justice, education, meteorology, and communications.

• Regardless of their chief field of interest, operations researchers have certain methods in common. They begin by immersing themselves in the details of the problem they're studying. They talk with people involved in all aspects of it, learning about their perspectives and needs, and they examine available data, separating that which is truly relevant from that which is not.

More about O.R. and Analytics as a Career

Q6. Should I consider a career in operations research/analytics?

There are many things to consider when planning your career - financial security and attractive possibilities now, and growth and advancement in the future. An ideal career is also a job that interests and excites you - one that makes you eager to get up in the morning, with a chance to feel good about what you're doing and make a real difference in people's lives.

Would O.R. and analytics be a good fit for me?

If you have an aptitude for math, find intrigue in the secrets of data, and have the determination to work through problems until you come up with a good solution, then you’re ready to consider a career in O.R. and analytics.

• O.R./analytics is a field that lets you accomplish all of these goals, and it's a discipline that can be applied in virtually every area of business and government - from health care, transportation, and city planning to manufacturing, finance, marketing, and the entertainment industry.

• Right now, thousands of operations researchers across the country and around the world are working on problems that affect us all - everything from shortening the time it takes to cash a paycheck at your local bank to assuring an adequate AIDS -free blood supply in our nation's hospitals.

• Our work is stimulating and rewarding, and our field is solidly established and expanding rapidly.
• We in O.R. and analytics feel that, ultimately, there's nothing more satisfying than leaving the world a little better than you found it.

Q7. What are the trends for a career in the field of operations research and analytics?

A number of major social and economic trends are increasing the need for operations researchers.

In today's global marketplace, businesses must compete more effectively for their share of profits than ever before, and public and nonprofit agencies must compete for ever-scarcer funding dollars.

This means that all of us must become more productive. Volume must be increased. Consumers' demands for better products and services must be met. Manufacturing and distribution must be faster. Products and people must be available "just in time," and accuracy must be made a priority to satisfy increasingly narrow tolerances for error.

It's a tall order. But, fortunately, new technologies developed over the past few decades have given operations researchers sophisticated tools to cope with these challenges.

Improvements in communications and information systems have made it possible to collect and store large amounts of data at drastically reduced costs. And, thanks to the personal computer explosion, these data can now be evaluated far more quickly and efficiently.

As a result, the demand for operations researchers is expected to increase dramatically, according to U.S. Labor Department projections.

Dramatic growth is expected in telecommunications and service firms, and traditional fields such as defense, manufacturing, and transportation should remain strong, as well, opening many attractive career paths for those entering the work force in the next decade.

Q8. What are the employment and salary prospects for operations researchers?

Math-related fields are frequently cited as those promising the most growth in job openings and salary, and the field of operations research and analytics is no exception. According to the Occupational Outlook Handbook*, the median pay for an operations researcher in 2010 was a healthy $70,960 per year. The number of jobs in the United States alone was 64,600 in 2010, and that number is expected to grow a strong 15% by the year 2020. But even these numbers do not represent the entire scope of the field.

Many people who begin their careers as operations researchers are promoted into management positions with broader responsibilities. Others who may be operations researchers by training gravitate into related areas and identify themselves as computer specialists, statisticians, marketing strategists, city planners, and the like. Of the more than 10,000 members of INFORMS, approximately 35% work in private industry, 56% in academia, and 9% in government and military jobs.

Established operations researchers and academics who teach O.R. and analytics often augment their salaries with consulting work that boosts total income even higher. And, of course, those who advance into top management roles encompassing other areas in addition to O.R. frequently earn in the mid- to upper-six-figure range.

Careers in O.R. provide many opportunities for advancement and put you at the center of an exciting new world where technical savvy is respected and relied upon.

Q9.What kinds of opportunities for advancement are there?

According to the Bureau of Labor Statistics, in May 2010 the median annual wage of operations research analysts was $70,960. The lowest 10 percent earned less than $39,920, and the top 10 percent earned more than $122,750. Almost all O.R. analysts work full time.

Government pay is generally slightly less but, as a rule, still either higher than or competitive with entry-level salaries in fields like accounting, data processing, finance, and product management. How rapidly you advance depends on factors such as your job performance, the number of higher-level openings in your area of concentration and the firm you select, your department's budget, and so on. But if you do your job well, you can usually expect a raise each year and a promotion within two or three years.

There are a number of paths your career may take. In private industry, for example, you might start out as an analyst and be promoted to senior analyst. From there, you could advance to director of a management science team or technical section or department. Or you might take on functional responsibilities and become a director or vice president of another department, such as manufacturing or marketing. Or, with sufficient experience under your belt, you might open your own consulting firm.

In civil service or the military, a bachelor's degree would probably qualify you for a GS5 or GS7 rating and placement in a training program. A master's degree would probably mean a GS7 or GS9 rating and several thousand dollars of additional pay. Here again, there's almost no limit to how far your abilities can take you. In fact, such notables as a Secretary of the Air Force and Deputy Secretary of State have recently come from the ranks of operations researchers.

Opportunities in academia also abound. At a college or university, you could become a professor, department head, or dean. And many academics also do consulting work on the side.

When selecting your first job remember that there are other factors to consider in addition to pay. Academic employment generally offers you more freedom and longer vacations. Government positions provide more job security. And in private industry there may be perks such as stock options and a company car to look forward to at higher levels.

Don't feel, however, that your initial choice locks you into one career track. One of the advantages of O.R. is that the basic skills you learn now are easily transferrable and can be applied in many different fields. So if, after a brief stint in public service, you decide you'd rather be working in industry - or vice versa - a career move is usually not difficult.

Q10. What education does an O.R./analytics professional need?

Entry-level professionals generally begin with a bachelor’s degree in math, business, or industrial engineering with an emphasis on quantitative methods. University O.R. and analytics programs are housed in different departments and schools, and most universities offer degrees in O.R. and analytics only at the graduate level. But it isn’t necessary to hold a degree in O.R. or analytics to get your career started as long as you’ve developed the necessary problem-solving skills. Although entry-level positions start with a bachelor’s degree, you may want to consider studying for a master’s degree so that you have the opportunity to apply your skills at the highest level in a corporation, consulting group, government agency, or nonprofit. Most graduate programs don’t require an undergraduate degree in O.R. or analytics for admission. If you can demonstrate that you’ve developed good quantitative skills as an undergraduate you shouldn’t hesitate to apply. If you’re interested in taking your skills to the very highest level, perhaps even doing research or teaching, consider pursuing a Ph.D. The INFORMS website offers a lengthy list of engineering and business schools that offer a degree.

Q11.What skills do operations researchers need?

As you've already seen, operations research is a broad field with widespread applications. And it's also one that you can select as your primary focus - or as an adjunct to another area of study.

You need not be a math major to become proficient in O.R. But, because it is mathematically based, you will need a solid grounding in statistics, probability, calculus, linear algebra, , and economics.

In addition, because the field relies so heavily on computers, an understanding of how they work is essential. And familiarity with optimization, statistical, and database management software is a plus.

In planning your course work, it's important to realize that O.R. is interdisciplinary, often drawing solutions from engineering, logic, psychology, and other social and political sciences. For this reason, a well rounded scientific background can also prove very useful.

O.R. isn't all science, however. Because a great deal of our work involves the gathering of information, the presentation of results, and assistance in implementing solutions, strong interpersonal and communications skills are vital. In short, you must write and speak clearly and convincingly and be able to listen well and deal tactfully with the concerns of others.

Effective operations researchers also usually possess a high degree of initiative, energy, and maturity. They are "self-starters" who are able to work well both individually and in team assignments. Their dedication to learning and professional development extends beyond the classroom and continues throughout their careers. And they are interested in practical solutions - judging the success of proposals not by whether theyshouldwork, but by whether theydo. If this sounds like you, O.R. may be an excellent career choice. We encourage you to find out more by talking with your academic advisors and seeking out professionals who can answer your questions and give you a personal perspective on our field.

Q12.Where can I get the preparation I need to work in operations research and analytics?

More than 150 colleges and universities in the United States and abroad offer degree programs or courses in operations research, management science, and related fields.

For your convenience, we've listed their names and locations here. To obtain more information, write or call the appropriate department and ask for a catalog and answers to any specific questions you may have.

Entry-level professionals generally begin with a bachelor’s degree in math, business, or industrial engineering with an emphasis in O.R., analytics, or quantitative methods. University O.R. and analytics programs are housed in different departments and schools, and most universities offer degrees in O.R. and analytics only at the graduate level. But it isn’t necessary to hold a degree in O.R. or analytics to get your career started as long as you’ve developed the necessary problem-solving skills. Although entry-level positions start with a bachelor’s degree, you may want to consider studying for a master’s degree so that you have the opportunity to apply your skills at the highest level in a corporation, consulting group, government agency, or nonprofit. Most graduate programs don’t require an undergraduate degree in O.R. or analytics for admission. If you can demonstrate that you’ve developed good quantitative skills as an undergraduate you shouldn’t hesitate to apply. If you’re interested in taking your skills to the very highest level, perhaps even doing research or teaching, consider pursuing a Ph.D.

Q13. How can students interested in operations research find out more?

One excellent way is to look over a copy of one of the many journals published by INFORMS.

We highly recommend Interfaces, which offers information on real-world applications of operations research in commerce, industry, government, and education, and the magazines OR/MS Today and Analytics Magazine, which provides breaking stories on significant new developments and trends in our field.

You can also find local and student INFORMS chapters that hold regular meetings where you'll have the opportunity to hear speakers and meet practitioners in diverse fields, chat with them about their work, pursue your interests in greater depth, and get a better idea about whether O.R. is the career for you.

Q14. What's it like to work in operations research?

Perhaps the best way to find out what operations research is like is to read about a few people who've made it their life's work. We've selected a representative sampling of professionals from a wide range of fields and asked them to fill you in. In the brief biographical sketches included here, you'll read about leaders in industry, government, academia, and private consulting firms who've used O.R. to achieve career success and personal fulfillment.

This is by no means a complete listing of the opportunities available. Today, operations researchers are helping shape the course of companies as diverse as Google, LinkedIn, General Motors, AT&T, Exxon, American Greetings, and Disney. They're working to improve government at the federal, state, and local levels and helping it become more responsive and cost-effective. They're making significant contributions at colleges and universities around the world through teaching and research, and they’re becoming entrepreneurs by setting up their own firms.

According to the Bureau of Labor Statistics**, the work you do in analytics and O.R. will challenge you just about every day. You will:

• Analyze data and information
• Spend lots of time on your computer with  sophisticated math software
• Make decisions and solve problems
• Gather the data you’ll need to solve those  problems
• Make full use of your creative thinking abilities
• Interpret the meaning of information for others
• Communicate your results and your  recommendations, not only to your colleagues  but also to your supervisors, and maybe to the  highest executives in your organization  as well

* http://www.bls.gov/ooh/Math/Operations-research-analysts.htm

** http://www.onetonline.org/link/summary/15-2031.00

Q15. What if I don’t know what career I want yet?

Explore possible careers and build a foundation of knowledge, experience, and skills.

Finding your career path is a process. You may already know what type of career you would like, but, as a student choosing a major, you may be uncertain about what major to pick and what career to begin.

Your career and job preferences will change over time as you gain more knowledge and experience. Some people know at an early age what they want to be and do that for lifetime. But careers can be more like a zig-zag path—you explore opportunities, choose one path that seems like the best choice for you, gain experience, and then make the next choice and next step.

Through experience (education, work, and activities) you’ll gain more insight into what your interests are, what you are good at, what you enjoy doing, what you have a passion for, and what your overall goals are for your work and life. What are the job opportunities in a field? What are the opportunities in industry, business, government, and colleges or universities? What do you want to be a core part of your career work? What might you decide pursue as activities outside of work?

You need to build a strong foundation for your range of choices. For a career in O.R. and analytics and other technical fields (science, engineering, math), you need a solid foundation in mathematics and scientific reasoning, good communication skills, and basic computer programming and technology skills. Computer languages and interfaces change, but you can always add to and refine your skills as needed.

Take advantage of opportunities to learn about possible majors and careers and find out more about fields related to your current areas of interest. Search, blog, take online tutorials, take a special course, intern or volunteer, join groups with common interests. Research the professional society organizations in your fields of interest (like INFORMS), and check their websites for career pages. If their magazines are online, scan the articles to see what current work is going on.

Q16. Where can I get more information?

If you’re interested in becoming an operations researcher or an analytics practitioner, you’ll want to take the first steps toward an education by examining information that’s available online. INFORMS and the federal government are both excellent resources for information about an education and career in O.R. and analytics.

Learn more:

INFORMS Career http://www.informs.org/Build-Your-Career/INFORMS-Student-Union/Career-Center/Career-FAQs

U.S. Department of Labor, Bureau of Labor, Occupational Outlook Handbook http://www.bls.gov/ooh/Math/Operations-research-analysts.htm

U.S. Department of Labor, Bureau of Labor, O*Net http://www.onetonline.org/link/summary/15-2031.00

Q17. What is INFORMS?

The Institute for Operations Research and the Management Sciences (INFORMS) is the largest professional society in the world for professionals in the field of operations research (O.R.), management science, and business analytics.