Quantitative analysis for management

OVERVIEW

The eleventh edition of Quantitative Analysis for Management continues to provide both graduate and undergraduate students with a solid foundation in quantitative methods and management sci- ence. Thanks to the comments and suggestions from numerous users and reviewers of this textbook over the last thirty years, we are able to make this best-selling textbook even better.

We continue to place emphasis on model building and computer applications to help students understand how the techniques presented in this book are actually used in business today. In each chapter, managerial problems are presented to provide motivation for learning the techniques that can be used to address these problems. Next, the mathematical models, with all necessary assump- tions, are presented in a clear and concise fashion. The techniques are applied to the sample problems with complete details provided. We have found that this method of presentation is very effective, and students are very appreciative of this approach. If the mathematical computations for a technique are very detailed, the mathematical details are presented in such a way that the instruc- tor can easily omit these sections without interrupting the flow of the material. The use of computer software allows the instructor to focus on the managerial problem and spend less time on the math- ematical details of the algorithms. Computer output is provided for many examples.

The only mathematical prerequisite for this textbook is algebra. One chapter on probability and another chapter on regression analysis provide introductory coverage of these topics. We use stan- dard notation, terminology, and equations throughout the book. Careful verbal explanation is pro- vided for the mathematical notation and equations used.

NEW TO THIS EDITION

� Excel 2010 is incorporated throughout the chapters.

� The Poisson and exponential distribution discussions were moved to Chapter 2 with the other statistical background material used in the textbook.

� The simplex algorithm content has been moved from the textbook to Module 7 on the Companion Website.

� There are 11 new QA in Action boxes, 4 new Model in the Real World boxes, and more than 40 new problems.

� Less emphasis was placed on the algorithmic approach to solving transportation and assign- ment model problems.

� More emphasis was placed on modeling and less emphasis was placed on manual solution methods.

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SPECIAL FEATURES

Many features have been popular in previous editions of this textbook, and they have been updated and expanded in this edition. They include the following:

� Modeling in the Real World boxes demonstrate the application of the quantitative analysis approach to every technique discussed in the book. New ones have been added.

� Procedure boxes summarize the more complex quantitative techniques, presenting them as a series of easily understandable steps.

� Margin notes highlight the important topics in the text.

� History boxes provide interesting asides related to the development of techniques and the peo- ple who originated them.

� QA in Action boxes illustrate how real organizations have used quantitative analysis to solve problems. Eleven new QA in Action boxes have been added.

� Solved Problems, included at the end of each chapter, serve as models for students in solving their own homework problems.

� Discussion Questions are presented at the end of each chapter to test the student’s understand- ing of the concepts covered and definitions provided in the chapter.

� Problems included in every chapter are applications oriented and test the student’s ability to solve exam-type problems. They are graded by level of difficulty: introductory (one bullet), moderate (two bullets), and challenging (three bullets). More than 40 new problems have been added.

� Internet Homework Problems provide additional problems for students to work. They are available on the Companion Website.

� Self-Tests allow students to test their knowledge of important terms and concepts in prepara- tion for quizzes and examinations.

� Case Studies, at the end of each chapter, provide additional challenging managerial applications.

� Glossaries, at the end of each chapter, define important terms.

� Key Equations, provided at the end of each chapter, list the equations presented in that chapter.

� End-of-chapter bibliographies provide a current selection of more advanced books and articles.

� The software POM-QM for Windows uses the full capabilities of Windows to solve quantita- tive analysis problems.

� Excel QM and Excel 2010 are used to solve problems throughout the book.

� Data files with Excel spreadsheets and POM-QM for Windows files containing all the exam- ples in the textbook are available for students to download from the Companion Website. Instructors can download these plus additional files containing computer solutions to the rele- vant end-of-chapter problems from the Instructor Resource Center website.

� Online modules provide additional coverage of topics in quantitative analysis.

� The Companion Website, at www.pearsonhighered.com/render, provides the online modules, additional problems, cases, and other material for almost every chapter.

SIGNIFICANT CHANGES TO THE ELEVENTH EDITION

In the eleventh edition, we have incorporated the use of Excel 2010 throughout the chapters. Whereas information about Excel 2007 is also included in appropriate appendices, screen captures and formulas from Excel 2010 are used extensively. Most of the examples have spreadsheet solu- tions provided. The Excel QM add-in is used with Excel 2010 to provide students with the most up-to-date methods available.

An even greater emphasis on modeling is provided as the simplex algorithm has been moved from the textbook to a module on the Companion Website. Linear programming models are pre- sented with the transportation, transshipment, and assignment problems. These are presented from a network approach, providing a consistent and coherent discussion of these important types of problems. Linear programming models are provided for some other network models as well. While a few of the special purpose algorithms are still available in the textbook, they may be easily omit- ted without loss of continuity should the instructor choose that option.

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In addition to the use of Excel 2010, the use of new screen captures, and the discussion of soft- ware changes throughout the book, other modifications have been made to almost every chapter. We briefly summarize the major changes here.

Chapter 1 Introduction to Quantitative Analysis. New QA in Action boxes and Managing in the Real World applications have been added. One new problem has been added.

Chapter 2 Probability Concepts and Applications. The presentation of discrete random variables has been modified. The empirical rule has been added, and the discussion of the normal distribution has been modified. The presentations of the Poisson and exponential distributions, which are impor- tant in the waiting line chapter, have been expanded. Three new problems have been added.

Chapter 3 Decision Analysis. The presentation of the expected value criterion has been modified. A discussion is provided of using the decision criteria for both maximization and minimization prob- lems. An Excel 2010 spreadsheet for the calculations with Bayes theorem is provided. A new QA in Action box and six new problems have been added.

Chapter 4 Regression Models. Stepwise regression is mentioned when discussing model building. Two new problems have been added. Other end-of-chapter problems have been modified.

Chapter 5 Forecasting. The presentation of exponential smoothing with trend has been modified. Three new end-of-chapter problems and one new case have been added.

Chapter 6 Inventory Control Models. The use of safety stock has been significantly modified, with the presentation of three distinct situations that would require the use of safety stock. Discussion of inventory position has been added. One new QA in Action, five new problems, and two new solved problems have been added.

Chapter 7 Linear Programming Models: Graphical and Computer Methods. Discussion has been expanded on interpretation of computer output, the use of slack and surplus variables, and the pres- entation of binding constraints. The use of Solver in Excel 2010 is significantly changed from Excel 2007, and the use of the new Solver is clearly presented. Two new problems have been added, and others have been modified.

Chapter 8 Linear Programming Modeling Applications with Computer Analysis. The production mix example was modified. To enhance the emphasis on model building, discussion of developing the model was expanded for many examples. One new QA in Action box and two new end-of-chapter problems were added.

Chapter 9 Transportation and Assignment Models. Major changes were made in this chapter, as less emphasis was placed on the algorithmic approach to solving these problems. A network repre- sentation, as well as the linear programming model for each type of problem, were presented. The transshipment model is presented as an extension of the transportation problem. The basic trans- portation and assignment algorithms are included, but they are at the end of the chapter and may be omitted without loss of flow. Two QA in Action boxes, one Managing in the Real World situation, and 11 new end-of-chapter problems were added.

Chapter 10 Integer Programming, Goal Programming, and Nonlinear Programming. More emphasis was placed on modeling and less emphasis was placed on manual solution methods. One new Managing in the Real World application, one new solved problem, and three new problems were added.

Chapter 11 Network Models. Linear programming formulations for the max-flow and shortest route problems were added. The algorithms for solving these network problems were retained, but these can easily be omitted without loss of continuity. Six new end-of-chapter problems were added.

Chapter 12 Project Management. Screen captures for the Excel QM software application were added. One new problem was added.

Chapter 13 Waiting Lines and Queuing Models. The discussion of the Poisson and exponential dis- tribution were moved to Chapter 2 with the other statistical background material used in the text- book. Two new QA in Action boxes and two new end-of-chapter problems were added.

Chapter 14 Simulation Modeling. The use of Excel 2010 is the major change to this chapter.

Chapter 15 Markov Analysis. One Managing in the Real World application was added.

Chapter 16 Statistical Quality Control. One new QA in Action box was added. The chapter on the simplex algorithm was converted to a module that is now available on the Companion Website with the other modules. Instructors who choose to cover this can tell students to download the complete discussion.

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ONLINE MODULES

To streamline the book, seven topics are contained in modules available on the Companion Website for the book.

1. Analytic Hierarchy Process

2. Dynamic Programming

3. Decision Theory and the Normal Distribution

4. Game Theory

5. Mathematical Tools: Matrices and Determinants

6. Calculus-Based Optimization

7. Linear Programming: The Simplex Method

SOFTWARE

Excel 2010 Instructions and screen captures are provided for, using Excel 2010, throughout the book. Discussion of differences between Excel 2010 and Excel 2007 is provided where relevant. Instructions for activating the Solver and Analysis ToolPak add-ins for both Excel 2010 and Excel 2007 are provided in an appendix. The use of Excel is more prevalent in this edition of the book than in previous editions.

Excel QM Using the Excel QM add-in that is available on the Companion Website makes the use of Excel even easier. Students with limited Excel experience can use this and learn from the formu- las that are automatically provided by Excel QM. This is used in many of the chapters.

POM-QM for Windows This software, developed by Professor Howard Weiss, is available to students at the Companion Website. This is very user friendly and has proven to be a very popular software tool for users of this textbook. Modules are available for every major problem type pre- sented in the textbook.

COMPANION WEBSITE

The Companion Website, located at www.pearsonhighered.com/render, contains a variety of mate- rials to help students master the material in this course. These include:

Modules There are seven modules containing additional material that the instructor may choose to include in the course. Students can download these from the Companion Website.

Self-Study Quizzes Some multiple choice, true-false, fill-in-the-blank, and discussion questions are available for each chapter to help students test themselves over the material covered in that chapter.

Files for Examples in Excel, Excel QM, and POM-QM for Windows Students can download the files that were used for examples throughout the book. This helps them become familiar with the software, and it helps them understand the input and formulas necessary for working the examples.

Internet Homework Problems In addition to the end-of-chapter problems in the textbook, there are additional problems that instructors may assign. These are available for download at the Companion Website.

Internet Case Studies Additional case studies are available for most chapters.

POM-QM for Windows Developed by Howard Weiss, this very user-friendly software can be used to solve most of the homework problems in the text.

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Excel QM This Excel add-in will automatically create worksheets for solving problems. This is very helpful for instructors who choose to use Excel in their classes but who may have students with limited Excel experience. Students can learn by examining the formulas that have been cre- ated, and by seeing the inputs that are automatically generated for using the Solver add-in for lin- ear programming.

INSTRUCTOR RESOURCES

� Instructor Resource Center: The Instructor Resource Center contains the electronic files for the test bank, PowerPoint slides, the Solutions Manual, and data files for both Excel and POM-QM for Windows for all relevant examples and end-of-chapter problems. (www.pear- sonhighered.com/render).

� Register, Redeem, Login: At www.pearsonhighered.com/irc, instructors can access a variety of print, media, and presentation resources that are available with this text in downloadable, digital format. For most texts, resources are also available for course management platforms such as Blackboard, WebCT, and Course Compass.

� Need help? Our dedicated technical support team is ready to assist instructors with questions about the media supplements that accompany this text. Visit http://247.prenhall.com/ for answers to frequently asked questions and toll-free user support phone numbers. The supple- ments are available to adopting instructors. Detailed descriptions are provided on the Instructor Resource Center.

Instructor’s Solutions Manual The Instructor’s Solutions Manual, updated by the authors, is available to adopters in print form and as a download from the Instructor Resource Center. Solutions to all Internet Homework Problems and Internet Case Studies are also included in the manual.

Test Item File The updated test item file is available to adopters as a downloaded from the Instructor Resource Center.

TestGen The computerized TestGen package allows instructors to customize, save, and generate classroom tests. The test program permits instructors to edit, add, or delete questions from the test bank; edit existing graphics and create new graphics; analyze test results; and organize a database of test and student results. This software allows for extensive flexibility and ease of use. It provides many options for organizing and displaying tests, along with search and sort features. The software and the test banks can be downloaded at www.pearsonhighered.com/render.