Match!

Models and Managers: The Concept of a Decision Calculus

Published on Sep 11, 2015
John D. C. Little36
Estimated H-index: 36
(MIT: Massachusetts Institute of Technology)
Sources
Abstract
(This article originally appeared in Management Science, April 1970, Volume 16, Number 8, pp. B-466-B-485, published by The Institute of Management Sciences.) A manager tries to put together the various resources under his control into an activity that achieves his objectives. A model of his operation can assist him but probably will not unless it meets certain requirements. A model that is to be used by a manager should be simple, robust, easy to control, adaptive, as complete as possible, and easy to communicate with. By simple is meant easy to understand; by robust, hard to get absurd answers from; by easy to control, that the user knows what input data would be required to produce desired output answers; adaptive means that the model can be adjusted as new information is acquired; completeness implies that important phenomena will be included even if they require judgmental estimates of their effect; and, finally, easy to communicate with means that the manager can quickly and easily change inputs and obtain and understand the outputs. Such a model consists of a set of numerical procedures for processing data and judgments to assist managerial decision making and so will be called a decision calculus. An example from marketing is described. It is an on-line model for use by product managers on advertising budgeting questions. The model is currently in trial use by several product managers.
  • References (22)
  • Citations (766)
📖 Papers frequently viewed together
1,344 Citations
1,149 Citations
239 Citations
78% of Scinapse members use related papers. After signing in, all features are FREE.
References22
Newest
#1Cesar Beltran-RoyoH-Index: 6
#2Huizhen Zhang (USST: University of Shanghai for Science and Technology)H-Index: 4
Last. J. AlmagroH-Index: 1
view all 4 authors...
We propose and analyze an effective model for the Multistage Multiproduct Advertising Budgeting problem. This model optimizes the advertising investment for several products, by considering cross elasticities, different sales drivers and the whole planning horizon. We derive a simple procedure to compute the optimal advertising budget and its optimal allocation. The model was tested to plan a realistic advertising campaign. We observed that the multistage approach may significantly increase the ...
9 CitationsSource
#1Cleo Schmitt Silveira (UFRGS: Universidade Federal do Rio Grande do Sul)H-Index: 2
#2Marta Olivia Rovedder de Oliveira (Universidade Federal do Pampa)H-Index: 3
Last. Fernando Bins Luce (UFRGS: Universidade Federal do Rio Grande do Sul)H-Index: 9
view all 3 authors...
Although researchers have developed a variety of methods to model customer equity (CE), producing simple and robust models is a difficult task. Often, researchers have to compromise simplicity in favor of robustness or completeness. This paper empirically investigates two CE-based methods to compute proxies for market value. The models differ substantially in terms of complexity and the type of information they use, but their result is equivalent. Both models use Gupta et al. (2004) CE approach,...
12 CitationsSource
#1S. Afshin Mansouri (Brunel University London)H-Index: 15
#2David Gallear (Brunel University London)H-Index: 18
Last. Mohammad H. Askariazad (Sharif University of Technology International Campus – Kish Island)H-Index: 1
view all 3 authors...
This paper aims to identify the gaps in decision-making support based on multiobjective optimization (MOO) for build-to-order supply chain management (BTO-SCM). To this end, it reviews the literature available on modelling build-to-order supply chains (BTO-SC) with the focus on adopting MOO techniques as a decision support tool. The literature has been classified based on the nature of the decisions in different part of the supply chain, and the key decision areas across a typical BTO-SC are dis...
59 CitationsSource
#1J. Scott ArmstrongH-Index: 57
There has been a substantial amount of interest recently in long-range planning. One necessary component of the long-range plan Is the long-range forecast. In contrast to the emphasis on the planning process, however, little attention has been given to forecasting. This study considers the problem of long-range forecasting in a situation which is of growing importance - forecasting sales for international markets.Many researchers appear to operate under the impression that causal models (i.e., m...
6 CitationsSource
#1William F. PoundsH-Index: 1
276 Citations
#1Glen L. UrbanH-Index: 1
This paper presents a model-based information system designed to analyze test-market results, to assist decision-making for a new frequently purchased consumer product, and to serve as an adaptive control mechanism during national introduction. The model, called SPRINTER, is based on the behavioral process of the diffusion of innovation and can be used normatively in an interactive search mode to find the best marketing strategy for a new product. The input is obtained from test-market data anal...
75 Citations
#1John D. C. LittleH-Index: 36
Information about sales response is collected by performing an experiment. The experimental results are used to update a sales response model. The promotion rate is chosen to maximize expected profit in the next time period. The cycle is repeated. The model employs a quadratic sales response function with a parameter that changes according to a first order, autoregressive process. The optimal adaptive system involves exponential smoothing of the experimental results.
82 Citations
#1Aude DevilleH-Index: 2
#2Gary D. Ferrier (UA: University of Arkansas)H-Index: 20
Last. Hervé Leleu (Lille Catholic University)H-Index: 13
view all 3 authors...
We extend the standard frontier efficiency models (data envelopment analysis [DEA] and stochastic frontier analysis [SFA]) by allowing the “decision making units” (DMUs) whose performances are assessed to consist of two different levels within hierarchical organizations. Generally, the lower level unit is responsible for “operations;” while higher level units are assumed to make “strategic” decisions. Our primary contribution in this paper is thus to extend the use of frontier efficiency models ...
1 Citations
#1Marc BolleckerH-Index: 5
#2Wilfrid AzanH-Index: 4
De nombreux auteurs mettent l'accent sur la necessite d'une ouverture disciplinaire dans les travaux de recherche. Notre article vise a analyser l'importance d'une telle demarche au travers de l'etude de ses enjeux et des pratiques des chercheurs en controle de gestion. Plus precisement, nous avons tente de cerner le degre de permeabilite des travaux en controle a des cadres conceptuels externes. Pour ce faire, les numeros de revues francaises – Comptabilite, Controle, Audit et Finance, Controle...
5 Citations
#1Aude Hubrecht-Deville (University of Burgundy)H-Index: 1
#2Hervé Leleu (CNRS: Centre national de la recherche scientifique)H-Index: 13
In this paper, we apply a standard model of performance evaluation to the retail banking industry. In this framework, the global economic performance is broken down into technical efficiency related to the optimal use of resources and price efficiency related to the optimal choice of a product-mix. Our main contribution is twofold. First we adapt this traditional framework to the retail banking network by giving a relevant interpretation of the efficiency measures at the branch manager and at th...
1 Citations
Cited By766
Newest
Abstract As demonstrated in Xiang and Fesenmaier's (2017) collection of articles Tourism Design involves the application of Big Data Analytics. This raises the question whether the tourism researchers' struggle for theory building may (have) come to an end since Big Data is doing it for them. Addressing several misunderstandings, the author discusses most recent studies, mainly from the field of Tourism Design, and identifies the masked elements of theory hidden in heavily data-driven big data a...
Source
Bevor wir uns nach der Beschreibung fundamentaler Gestaltungsprinzipien und moglicher, individueller Serviceanforderungen endgultig auf die Ebene der konkreten Netzwerkkonfiguration begeben, sei etwas ausfuhrlicher auf den Projektcharakter eingegangen, der der hier behandelten Aufgabenstellung in der Praxis regelmasig zukommt. Dabei orientieren wir uns aus Vereinfachungsgrunden zunachst primar an der Aufgabe, eine adaquate Netzwerkkonfiguration fur Distributionssysteme zu entwickeln.
Source
#1Xu-Sheng Zhang (PHE: Public Health England)H-Index: 19
#2Alexandra Smith (PHE: Public Health England)
Last. Christina Atchison (PHE: Public Health England)H-Index: 12
view all 9 authors...
Chickenpox is caused by varicella-zoster-virus (VZV) and is highly contagious. Immigration detention settings are a high-risk environment for primary VZV transmission, with large, rapidly-changing populations in close quarters, and higher susceptibility among non-UK-born individuals. During outbreaks, operational challenges occur in detention settings because of high-turnover and the potential need to implement population movement restriction for prolonged periods. Between December 2017 and Febr...
Source
view all 4 authors...
Die Gesundheitswirtschaft in Deutschland befindet sich aktuell in einem umfanglichen Wandlungsprozess. Technische Entwicklungen wie Blockchain, Wearables und kunstliche Intelligenz (KI) haben Einfluss auf die deutsche Gesundheitswirtschaft. Wenn auch etwas langsamer als in anderen Industriezweigen ist die Digitalisierung in der Gesundheitswirtschaft dabei eine Entwicklung von stets wachsender Bedeutung. Alle Akteure der Gesundheitswirtschaft sind mit der Herausforderung weitreichender Veranderun...
Source
Decision making has been one of the challenging tasks in solving real-world problems. Decision making mimics human activity which in turn has noteworthy impacts. Several researches have proved that the quality of decisions has been improved by developing computer-based technologies that aid and extend the human capabilities. Decision support systems (DSS), which augment in making proper decisions, to an extent, do sometimes lack intelligence. The recent advances in the field of artificial intell...
Source
#1Anssi KäkiH-Index: 5
#2Katariina Kemppainen (Aalto University)H-Index: 11
Last. Juuso Liesiö (Aalto University)H-Index: 12
view all 3 authors...
Abstract Decision makers do not always follow recommendations from model-based decision support systems. We suggest that analyzing the differences between decision recommendations produced by prescriptive models and the behavior of the decision makers provides valuable insights that can be utilized to improve model-based decision support processes. Specifically, we develop an intervention process in the context of hydropower production planning to study the motivations of decision makers and the...
1 CitationsSource
#1Miquel Sànchez-Marrè (UPC: Polytechnic University of Catalonia)H-Index: 18
#2Karina Gibert (UPC: Polytechnic University of Catalonia)H-Index: 15
Last. Beatriz Sevilla-Villaneva (UPC: Polytechnic University of Catalonia)
view all 3 authors...
In this paper, some new components that have been integrated in the Diet4You system for the generation of nutritional plans are introduced. Negative user preferences have been modelled and introduced in the system. Furthermore, the cultural eating styles originated from the location where the user lives have been taken into account dividing the original menu plan in sub-plans. Each sub-plan is in charge to optimize one of the meals of one day in the personal menu of the user. The main latent rea...
Source
#1Yangyan Shi (Macquarie University)H-Index: 6
#2Tiru Arthanari (University of Auckland)H-Index: 8
Last. Brenda Yang (University of Auckland)H-Index: 1
view all 4 authors...
Abstract The issue of sustainability has been a focus in the transportation industry. With the development of global business operations, increasing container demand causes transportation issues, and many trucking companies make truck assignment and driver scheduling decisions based on managerial experience, leading to capacity underutilization. A further consequence is traffic congestion and pollution issues influencing customer satisfaction. The key purpose of this study is to explore dynamic ...
4 CitationsSource
#1Daniel J. Power (UNI: University of Northern Iowa)H-Index: 21
#2Ciara Heavin (UCC: University College Cork)H-Index: 6
Last. Peter B. Keenan (UCD: University College Dublin)H-Index: 11
view all 3 authors...
ABSTRACTLooking forward, the goal of this article is to stimulate discussion and encourage novel thinking about computerized systems. Looking back 60 years, this article reviews definitions and research related to the decision system concept and associated terms like automated decision system (ADS) and decision support system (DSS). This historical perspective differentiates and expands the phenomenon of a decision system to create a modern context for future applied and scholarly research and d...
Source