Business Modelling
The application of modelling techniques to business problems has led to many organisations achieving significant commercial advantage. Several examples are below:
- Computer simulation of production lines to identify bottlenecks. With this knowledge, different animated scenarios can be created in order to calculate how relatively minor changes can improve throughput and make reductions to cost per unit.
- Improved short and long term forecasting of inbound calls within a customer service centre to set staffing levels - thus saving money on overtime and recruitment errors, as well as ensuring that customers' calls are answered first time.
- Applying statistical models to sales data in order to determine the success or otherwise of Marketing initiatives.
- Creating "Yield Management" models for airlines, in order to maximise revenue per seat through flexible pricing strategies.
Business Modelling is also referred to as Operational Research, Decision Support or Management Science. It shares many techniques and approaches within the Industrial Engineering discipline.
Such techniques also have many unusual applications. The Journal of the Operational Research Society featured a paper in 2003 which provided statistical advice suggesting the conditions that Premiership football managers should be sacked!
This webpage will develop to include several more detailed examples of how Business Modelling can make improvements to performance, and in turn, profit.