Description

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There's no doubt that a manager's job is getting tougher. Do it better, do it faster, do it cheaper are the pressures every manager faces. And at the heart of every manager's job is decision-making: deciding what to do and how to do it. This well-respected text looks at how quantitative analysis techniques can be used effectively to support such decision making.

As a manager, developing a good understanding of the quantitative analysis techniques at your disposal is crucial. Knowing how, and when, to use them and what their results really mean can be the difference between making a good or bad decision and, ultimately, between business success and failure.

Appealing both to students on introductory-level courses and to MBA and postgraduate students, this internationally successful text provides an accessible introduction to a subject area that students often find difficult. Quantitative Analysis for Decision Makers (formerly known as Quantitative Methods for Decision Makers) helps students to understand the relevance of quantitative methods of analysis to management decision-making by relating techniques directly to real-life business decisions in public and private sector organisations and focuses on developing appropriate skills and understanding of how the techniques fit into the wider management process.

Table of Contents

Contents

List of ‘QMDM in Action’ case studies

Preface  

Acknowledgements

1   Introduction

The Use of Quantitative Techniques by Business

The Role of Quantitative Techniques in Business

Models in Quantitative Decision Making

Use of Computers

Using the Text

Summary

2  Tools of the Trade

Learning objectives

Some Basic Terminology

Fractions, Proportions, Percentages

Rounding and Significant Figures

Common Notation

Powers and Roots

Logarithms

Summation and Factorials

Equations and Mathematical Models

Graphs

Real and Money Terms

Worked Example

Summary

Exercises

3  Presenting Management Information

Learning objectives

A Business Example

Bar Charts

Pie Charts

Frequency Distributions

Percentage and Cumulative Frequencies

Histograms

Frequency Polygons

Ogives

Lorenz Curves

Time-Series Graphs

Z Charts

Scatter Diagrams

General Principles of Graphical Presentation

Worked Example

Summary

Exercises

4   Management Statistics

Learning objectives

A Business Example

Why Are Statistics Needed?

Measures of Average

Measures of Variability

Using the Statistics

Calculating Statistics for Aggregated Data

Index Numbers

Worked Example

Summary

Exercises

5   Probability and Probability Distributions

Learning objectives

Terminology

The Multiplication Rule

The Addition Rule

A Business Application

Probability Distributions

The Binomial Distribution

The Normal Distribution

Worked Example

Summary

Exercises

6  Decision Making Under Uncertainty

Learning objectives

The Decision Problem

The Maximax Criterion

The Maximin Criterion

The Minimax Regret Criterion

Decision Making Using Probability Information

Risk

Decision Trees

The Value of Perfect Information

Worked Example

Summary

Exercises

7  Market Research and Statistical Inference

Learning objectives

Populations and Samples

Sampling Distributions

The Central Limit Theorem

Characteristics of the Sampling Distribution

Confidence Intervals

Other Confidence Intervals

Confidence Intervals for Proportions

Interpreting Confidence Intervals

Hypothesis Tests

Tests on a Sample Mean

Tests on the Difference Between Two Means

Tests on Two Proportions or Percentages

Tests on Small Samples

Inferential Statistics Using a Computer Package

p Values in Hypothesis Tests

x2 Tests

Worked Example

Summary

Exercises

8  Quality Control and Quality Management

Learning objectives

The Importance of Quality

Techniques in Quality Management

Statistical Process Control

Control Charts

Control Charts for Attribute Variables

Pareto Charts

Ishikawa Diagrams

Six Sigma

Worked Example

Summary

Exercises

9  Forecasting I: Moving Averages and Time Series

Learning objectives

The Need for Forecasting

Approaches to Forecasting

Trend Projections

Time-Series Models

Worked Example

Summary

Exercises

10  Forecasting II: Regression

Learning objectives

The Principles of Simple Linear Regression

The Correlation Coefficient

The Line of Best Fit

Using the Regression Equation

Further Statistical Evaluation of the Regression Equation

Non-linear Regression

Multiple Regression

The Forecasting Process

Worked Example

Summary

Exercises

11  Linear Programming

Learning objectives

The Business Problem

Formulating the Problem

Graphical Solution to the LP Formulation

Sensitivity Analysis

Computer Solutions

Assumptions of the Basic Model

Dealing with More than Two Variables

Extensions to the Basic LP Model

Worked Example

Summary

Exercises

12  Stock Control

Learning objectives

The Stock-Control Problem

Costs Involved in Stock Control

The Stock-Control Decision

The Economic Order Quantity Model

The Reorder Cycle

Assumptions of the EOQ Model

Incorporating Lead Time

Classification of Stock Items

MRP and JIT

Worked Example

Summary

Exercises

13  Project Management

Learning objectives

Characteristics of a Project

Project Management

Business Example

Network Diagrams

Developing the Network Diagram

Using the Network Diagram

Precedence Diagrams

Gantt Charts

Uncertainty   

Project Costs and Crashing

Worked Example

Summary

Exercises

14  Simulation

Learning objectives

The Principles of Simulation

Business Example

Developing the Simulation Model

A Simulation Flowchart

Using the Model

Worked Example

Summary

Exercises

15  Financial Decision Making

Learning objectives

Interest

Nominal and Effective Interest

Present Value

Investment Appraisal

Replacing Equipment

Worked Example

Summary

Exercises

Conclusion

Appendices

A  Binomial Distribution

B  Areas in the Tail of the Normal Distribution

C  Areas in the Tail of the t Distribution

D  Areas in the Tail of the x² Distribution

E  Areas in the Tail of the F Distribution, 0.05 Level

F Solutions to Progress Check Questions

Back Cover

There's no doubt that a manager's job is getting tougher. Do it better, do it faster, do it cheaper are the pressures every manager faces. And at the heart of every manager's job is decision-making: deciding what to do and how to do it. This well-respected text looks at how quantitative analysis techniques can be used effectively to support such decision making.

As a manager, developing a good understanding of the quantitative analysis techniques at your disposal is crucial. Knowing how, and when, to use them and what their results really mean can be the difference between making a good or bad decision and, ultimately, between business success and failure.

Appealing both to students on introductory-level courses and to MBA and postgraduate students, this internationally successful text provides an accessible introduction to a subject area that students often find difficult. Quantitative Analysis for Decision Makers (formerly known as Quantitative Methods for Decision Makers) helps students to understand the relevance of quantitative methods of analysis to management decision-making by relating techniques directly to real-life business decisions in public and private sector organisations and focuses on developing appropriate skills and understanding of how the techniques fit into the wider management process.

Key features:

• The use of real data sets to show how analytical techniques are used in practice
• “QADM in Action” case studies illustrating how organisations benefit from the use of analytical techniques
• Articles from the Financial Times illustrating the use of such techniques in a variety of business settings
• Fully worked examples and exercises supported by Excel data sets
• Student Progress Check activities in each chapter with solutions
• A 300+ page Tutors Solutions Manual 

Mik Wisniewski has almost five decades of experience in quantitative analysis. He has taught at a number of leading universities, worked in both industry and government and has extensive consultancy experience in the UK and across Europe, Africa, the Middle East and Asia.

Dr. Farhad Shafti is a senior academic with expertise in Management Science. He has extensive experience teaching in highly ranked universities, covering undergraduate, postgraduate and MBA studies in the UK and overseas.