Management Science – The Definitive Guide
Management is a core function of every business and a number of theories try to explain how the processes of management can be best utilized to help the organization to succeed. Management science is one such approach and in this guide, we’ll explore the history of this approach.
We’ll explain the definition and core elements of the style, as well as compare the benefits and disadvantages of implementing this strategy.
Finally, we’ll look into the different ways it has been applied in the past and the steps you need to take to implement it in your organization.
THE HISTORY OF MANAGEMENT SCIENCE
Management science has an interesting history and the approach has evolved over the years to its current concept, which we’ll explore further in the next section. The roots of management science can be found in a concept of operations research, which was a system developed during World War II. The War, like other wars before and after it, involved plenty of operations outside of the traditional fighting on the battlefield. Warfare changed from the First World War and scientists from different fields were part of the effort to gain the upper hand on both sides of the war.
Operation research or operational research saw the scientists trying to apply analytical methods in order to enhance the decision-making processes. The approach was highly used by the Allied forces, with Britain engaging nearly 1,000 men and women in operation research during the war. The basis of operation research was on different mathematical models, which were used to make predictions that would improve military operations.
One example of the operation research use was the application of ‘effectiveness ratios’, which compared the flying hours of Allied planes with enemy U-boat sightings in a given area. By studying these numbers, the military was able to distribute the planes to productive patrol areas and map out enemy positions more efficiently.
After the war, the operation research model became implemented in the corporate sector. As businesses and other organizations begun using analytical research as part of the decision-making process, the term management science was coined. In 1967, Stafford Beer said the field of management science is essentially “the business use of operations research”.
At this initial stage, management science involved around the application of different scientific methods and findings in order to solve management problems and streamline the processes of management. The broad approach meant the system used operation research, system analysis as well as the study of management-information systems as part of the implementation. Since then, the definition and scope of management science has become more defined.
THE CORE CONCEPTS OF MANAGEMENT SCIENCE
Now that we’ve looked into the history of management science, we can move on to exploring the current definition of the practice together with its core concepts.
The definition of management science
According to Lancaster University, management science can be defined as a concept that is “concerned with developing and applying models and concepts that help to illuminate issues and solve managerial problems”. The approach is essentially interested in looking at an organization and finding ways it can manage itself better and improve its productivity.
The core aim of the approach is to use scientific concepts and methods in order to solve management-related issues. It does this by focusing on analyzing different management approaches, comparing them with existing possibilities and offering possible outcomes of which the organization can pick to improve productivity.
While management science is mainly a mathematical approach to solving problems, the application of it requires the examination of different fields. Management science uses analytical data, statistics and methods for increasing efficiency of management systems and it finds the tools from fields like:
- Business Administration
The key to management science is the visualization of management as a logical action. Since the approach views management through this lens, it means the process can be quantified and described with the help of symbols, measurements and relationships. The approach basis its theory on the decision theory approach and rational decision-making models and it can provide organizations with a model that helps identify goals and the roadmap for achieving them.
Management science makes a few general assumptions of management, which are the basis for its framework. The assumptions are:
- Management is a problem-solving mechanism, which can be boosted by mathematical tools and techniques.
- Problems in management can be quantified and described in mathematical terms. This includes areas such as system analysis, but also human behavior.
- Managerial problems can best be resolved through mathematical tools, simulations and models.
If you’re interested in the future of management science, then watch the video of Andrew McAfee discussing the possibilities future improvements in Information Technology can provide to management science.
The four core areas of research
The management science approach relies on four core areas of research. These four are the steps an organization must take in order to properly implement management science and they are the four core elements defining the system.
The first one is about discovering, developing, defining, and evaluating the goals and policies that lead to these objectives. This requires the organization to examine the goals it has set, the goals it could set and the current and possible methods and processes it could use in order to achieve them. This is about the initial step of understanding what the company wants to do, what the company is doing, and what the company could be doing.
The second core element is about ensuring the organization adopts those policies. Once the processes and policies have been chosen from the selection of options, science management requires the company to enforce them. This might require additional policy decisions and changes in the way the organization operates, but the key is to implement the processes as identified during the initial phase.
After the policies are being implemented, management science calls for scrutinizing the effectiveness of the policies. Management science doesn’t just provide the tools for making better decisions and streamlining the management procedures within the organization. It can also help with monitoring of the viability of these approaches and decisions.
Finally, the fourth element is about initiating changes to the policies in case they are found ineffective. If the processes are not working as intended and the organization is not achieving the predicted outcomes, management science provides the framework for figuring out the failing parts. The analytical approach doesn’t just measure how things might be, but it can help identify why certain outcomes weren’t achieved. This will help make changes on the go and shift the focus to the processes that will guarantee the achievement of the objectives.
In the final section, we’ll return to examining how the above can be implemented in the most effective manner.
THE BENEFITS OF MANAGEMENT SCIENCE
When it comes to the benefits of implementing a management science approach, organizations can expect a number of advantages. Management science can reduce the overall efficiency of the organization and make decision-making easier and more defined.
The broad advantage of the approach is its ability to design measures that can be used to identify and evaluate the effectiveness of the processes currently in use. Management science looks at the current situation and compares it with other possibilities, creating measurable predictions.
The analysis of processes and decision-making can help the organization identify the problem areas, as well as the systems that are already working efficiently. The identification of these will guarantee the organization is using processes and decision-making approaches that provide the best results in terms of the achieving the organization’s objectives.
Furthermore, the management science approach can help more specifically in the following core areas of any business:
- Planning – The management science approach can be used in the planning because it identifies and predicts the results of certain processes. The approach makes it easier to understand the future needs of the organization based on the current and future models, as well as the objectives the organization is looking to fulfill.
- Organizing – Creating systems that efficiently focus on the specifically defined processes and tasks. Furthermore, it makes it easier to direct resources to their right places.
- Leading and controlling operations – Since the approach focuses on management, it can boost the way the organization leads. It can help individual managers focus on the most important aspects of the organization and improve their decision-making skills.
Efficiency in the following core areas of business will provide boosts in productivity, industrial peace and enhance the organization’s ability to specialize its products and services. Productivity results from the efficiency in planning, organizing and leading, as the processes are streamlined and different parts of the organization focus on the areas that maximize their efficiency.
Furthermore, the higher productivity can result in increased wages as well, since the organization doesn’t need to worry about time-wasting and inefficient workforce. As wages improve, employee motivation is likely to improve, creating a system of reinforced productivity.
In terms of industrial peace, management science enforces better co-operation between the management and the labor. The enhanced processes create an environment of clarity in the workplace and provide more security to the workforce in terms of knowing their position and the health and safety of the employee. If relations between the management and the labor are harmonious and built on trust and respect, industrial disputes are less likely to take place.
Employee motivation and productivity are also boosted through the safer work environment, as alluded above. The approach identifies the most efficient and the safest ways to produce products and services. This can have a meaningful impact on the working conditions and thus increase industrial peace further.
Specialization is improved through enhanced understanding of the strengths and weaknesses of the organization. Management science helps identify the processes, which work, notice the areas of weakness, and realize the future possibilities and needs of the organization’s consumer base. The approach makes the utilization of resources easier, since the framework can notice the availability of resources and the proper use of them.
As the above shows, management science can be beneficial for the organization by improving the way it operates, but also guaranteeing better relations between the different stakeholders. With improved efficiency, productivity will increase and further create a situation for higher profits.
Here is a great talk of how data will transform businesses.
THE DISADVANTAGES OF MANAGEMENT SCIENCE
What about the downside to management science? Despite the above advantages, certain drawbacks need to be taken into account before an organization starts using the approach. The disadvantages should be taken seriously, even though many of these drawbacks can be limited and controlled with proper implementation and planning.
Management science controls the decision-making process within the organization. Decisions are made based on the findings of the framework, using analysis of different factors and implementing a variety of methodologies. This can lead to reduced employee-involvement in decision-making, as the process is not controlled by discussion and opinion, but focus is on numbers and scientific predictions.
In its essence, management science supports a top-down decision-making process. If you read management expert opinions, many champion the opposite to the traditional top-down approach. Author Peter Diamandis is among the proponents of collective decision-making, stating, “collective management will build companies – not top-down decision-making”.
The problem with transferring the decision-making completely away from employee input is how it creates situations where people feel disengaged. Since you don’t have any voice, you can more easily feel uncomfortable with the decisions. Even if you wouldn’t get your way with the decisions, the ability to influence or discuss the decision can be enough to make you feel more engaged.
Management science also requires an understanding of the process, which is something the employee doesn’t necessarily have. The employees might not have a good grasp of how the decisions were made and the justification behind the conclusion, which can make the management’s approach seem further disengaging and confusing.
The framework also looks at individual components and therefore breaks down the tasks into smaller objectives. This can create fragmentation throughout the organization, which can have a few defining impacts. First, the fragmentation of objectives means each employee is closely associated with a single unit of action. In short, employees have a task and the instructions on how to do it.
The employee just needs to fulfill the objective and the task is done. Since each person is in charge of their own objective, tasks don’t have much spill over. This can lead to a situation where teamwork is non-existent. Employees are only focused on the specific tasks they’ve been given, without the need to discuss or co-operate with others. While this might suit certain types of employees, others might find it disengaging again. The second problem of fragmentation follows directly from the lack of teamwork.
If team-building and co-operation are diminished, creativity within the organization can suffer. People don’t communicate with each other in the same way, creating a system where the team starts relying on the feedback from the management science framework. Ideas are not thrown around, but rather people wait for the management science framework to come up with the best approaches.
The above points deal with the disadvantages in terms of employee engagement and creativity. But management science can have a few drawbacks on a more practical, operational sense as well. First, the approach generalizes that things can be quantified. For the model to work and make effective predictions, things should be quantifiable and easily measured. If they are, then mathematical calculations will work accurately and the outcomes can be analyzed with care.
But certain issues and problems won’t be easily quantified or standardized. For example, while resources and equipment can be standardized, human behavior is much harder to generalize, as certain people can perform well in specific conditions in which someone else might fail. Therefore, by creating artificial generalization and standardization, the management will reduce the effectiveness of the predictions. If the set of processes analyzed is not correctly quantified, the outcomes might not be the most accurate. In effect, this means the resulting decisions might not yield the optimum results.
In addition to the above, management science has a problem with scaling. Since the framework requires plenty of data and the data has to be as accurate as possible, the implementation process can be much easier for smaller organizations. Creating a process for data collection, analysis and prediction is easier when you have only a limited number of data available with a small organization. The process can be easier to establish and the results can be faster to achieve since analyzing won’t take forever. On the other hand, the cost of establishing an efficient management science system can be high and the expensive element of the framework can make it unattractive for smaller firms.
Watch this interesting case study on how management science could be applied to understanding mobile users (warning: only for super nerds like me)
APPLICATION OF MANAGEMENT SCIENCE
Management science has a number of benefits, which has meant that different fields have started using it to enhance operational and managerial efficiency. Since its early start as part of a core approach to the military, the application has found its way to industries as varied as medical, political, public administration and business. Management science has provided solutions and identified deeper insights into the industries in a number of ways. The following examples are among the best examples of how management science can be applied in a meaningful manner:
- The airline industry has used management science to create the scheduling systems for airlines. This has created the system for ensuring the planes are utilized more efficiently, together with guaranteeing the crew is rotated in the most efficient way.
- A number of information systems currently in use by organizations are a result of management science. The approach has been used to identify and understand the correct information system strategies.
- Public administrations have also used management science to identify the flow of water from water reservoirs. The process identifies the most efficient routes and cost-effective ways to manage the flow.
As the examples show, there are different ways to utilize management science. The application of the framework helps organizations create enhanced efficiency in areas such as cost, production and the level of service by solving the different managerial problems.
In terms of applying management science in business, there is a six-step formula for making the most of it. The steps will help streamline business operations and create a process-based environment for the organization.
Source and Copyrights: World Health Organisation website
1. Identifying business processes in use
The organization must first identify the different management processes it currently has in place. By identifying each process, it’s also possible to notice the strengths and weaknesses of the individual management operation.
For example, you’ll identify all the management teams and understand its positive impact on the workforce. As you identify the processes, you’ll start noticing the patterns of management and the specific aspects that require changing or tweaking.
2. Analyze the individual processes
As you’ve identified the problem areas, as well as the management processes that are working effectively, you can start using management science to modify the process. By implementing the analytical approach, you will notice which processes need scaling, implementation or adjustment.
This step is the key part of management science; it is about diagnosis and the identification of the solution. In some instances, it can even help with creating systems that prevent future problems.
3. Redesign the processes
With the analysis done, the focus should move to identifying the right process for achieving the right results. Management science tends to present a number of solutions and predictions, which means the organization has to identify the most effective processes for its needs.
4. Ensure the right resources are in place to improve the processes
Once you’ve identified the processes and the solutions to the management problems, you need to ensure the organization has the right resources at hand. Redesigning of the processes might require additional resources, either in terms of money or labor. Ensure the appropriate amount and type of resources is identifying to guarantee the newly established processes work as planned.
5. Implement the identified processes
The fifth step is about implementation of the above processes. As mentioned in the section about the disadvantages of management science, the system can easily cause fragmentation if the organization is not careful.
Therefore, at this step, you must ensure there’s a community wide buy-in and proper information available for people to understand the changes, the reasoning behind them, as well as the new processes themselves.
6. Review and analyze the effectiveness of the new processes
Finally, the implemented processes require constant analysis and review. Management science will provide answers and prediction, but just like any other approach to management, it’s not a magic pill to fix everything.
Therefore, you must make sure you continue to collect data and analyze the effectiveness of the processes in place. Only this will guarantee they are working as intended and will provide the organization better chances of tweaking the approach as you go.
THE BOTTOM LINE
Management science is a logical and analytical approach to management and how it impacts an organization. The approach has been used in a variety of industries since its inception during World War II. By using the approach, an organization is able to identify different management processes and whether they are working as efficiently as they could.
It can provide new ways to approach management issues and it helps streamline the decision-making process by creating models the organization can use. While management science can provide plenty of benefits in terms of improvements in productivity and cutting costs, the implementation can also have drawbacks on the workplace.
Employee satisfaction can suffer and the organization has to deal with the fragmentation of processes. The approach is not a quick remedy for solving issues, but when it is applied correctly, the results can lead to success.
We meet Danae Ringelmann, chief development officer of Indiegogo, in Berlin. She shares her …
In this article, we will explore, 1) what is a value proposition, 2) elements of the value …