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The article discusses the evolution of "Scientific Management" in the United States from the early 19th century until the mid-20th century. The 1911 book "The Principles of Scientific Management" by Frederick Winslow Taylor is discussed. The studies of Frank and Lillian Gilbreth are cited. The 1832 book "Economy of Machinery and Manufacture" by Charles Babbage is cited. The article discusses the meeting of 300 industrialists in 1912 at the Tuck School at Dartmouth, where the term "Scientific Management" became widely used. The First World War production demands accelerated the application of management theory. The writings of Mary Parker Follett and Dr. Harry Arthur Hopf are discussed. The article comments on Dr. Norbert Weiner and his theory of "cybernetics."

The article creates a mathematical model for determining the most efficient schedule for a small city bus network. The task is defined as a sequencing problem. The article states that a bus schedule will be judged to be efficient if it minimizes the amount of time passengers spend waiting at the bus stops throughout the network. The problem is solved through the use of algebraic formulas and spiral diagrams that include the number of branch and trunk lines, the number of buses, the frequency of departures, and anticipated number of passengers.

The article discusses the application of linear programming to transportation-related problems. Linear programming is used to optimize a criterion, such as total costs, while meeting certain prescribed conditions, such as required delivery schedules. The data is set forth in a tabular matrix from which the least costly solution may be calculated. The focus of the hypothetical problem is a shipping manager who has to ship 16 items from three warehouses to five destinations. A purely mathematical solution is provided in the appendix.

The article endeavors to apply mathematical concepts to the manufacturing assembly process in a way that bridges the gap between mathematicians and the "production man." The article begins with a typical assembly parts list for a manufactured product. The list is reduced to a simplified numerical notation presented on a grid. The information is then presented pictorially as an umbel illustration showing every individual part. The illustration is then converted to a simplified "Gozinto Graph." The data is then converted to an algebraic equation. The article demonstrates that if a sales order is presented, it is easy to compute the total number of parts necessary to fulfill the order. The article also anticipates the use of electronic computing machines in industry.

The article considers a simple mathematical model for scheduling rates of production to meet projected requirements. The production, shipping, storage, and production increase numbers are considered and presented as mathematical equations. Unit costs are factored. Shipping requirements, represented as (r), are assumed to increase over time. The results are graphed. Reference is made to the SEAC electronic computer at the U.S. National Bureau of Standards in Washington, DC. Reference is also made to the linear programming method developed by S. Glass, L. Goldstein, W. Jacobs, and T. Saaty.

The article discusses the emerging technology of computers in the context of management science. The author differentiates between computers and data processors. Magnetic tapes, such as those used by the IBM Electronic Data Processing Machines, are discussed, as are punch cards. The mathematical formulation of problems through the use of linear equations is discussed, as is the application of computing equipment to solve them. In case where a unique solution is not possible, the article describes the application of maximization. Linear programming and the simplex method are discussed. Simulation is used in cases where neither a unique nor an optimum solution can be obtained directly. This may include train scheduling, bus scheduling, airplane scheduling, and other applications.

Most of the writing on the new "Management Science", that is on the application of systematic methodology to the job of managing in the business enterprise, has so far come from the scientists. Understandably it has therefore focused on the finding of areas in business to which the scientist can apply tools and techniques with which he is already familiar, and on the sharpening and development of these tools. The all but universal approach has been: here is a scientific method, here are scientific tools and techniques; let us find applications for them in the business enterprise. This paper proposes to look at "Management Science" from the point of view of the Manager. Its focus will therefore be on determining what methodology, what tools and techniques the Manager needs to do an orderly and systematic job of managing. Concretely the focus will be on the specific process through which the Manager does his work, and on the specific object to which his work is directed; one focus will be on Decision Making, one on the Business Enterprise and its structure. And the aim of this paper is to develop, albeit in rough and sketchy form, some specifications for "Management Science". [ABSTRACT FROM AUTHOR]

The article proposes that human organizations may be compared to machines, and that scientific principles may be applied to analyzing and improving a human "machine." The article discusses teams, which are defined as a group of persons each of whom makes decisions about a specialized issue, but who receive a common reward as the joint result of all those decisions. One challenge to a team is how to balance the advantages of full information for every team member against its cost. The author constructs a simple mathematical team model consisting of two team members who are faced with a set of variables. Choices and outcomes are presented in a series of matrices. The article references C. B. Tompkins and the SWAC computer of the U.S. Institute for Numerical Analysis.

The article examines how the methods of linear programming may be used to obtain optimal estimation of executive compensation plans. The various elements that are considered when setting executive compensation are discussed, including individual personality traits. These elements are translated into a linear equation. Upper and lower salary boundaries are set. A geometric representation of the input is presented as a set of points on an axis. The data is then displayed as a table or matrix. By eliminating the redundancies, reducing the remaining inequalities to equivalent equalities, and inserting vectors, a first-stage simplex tableau was obtained.

This paper is concerned with the problem of selecting securities for managing an investment portfolio. The field of investment has a long history of detailed analysis by economists and investment analysts. This has resulted in theories of economic behavior (in terms of the securities markets as integral components in economy-wide analyses) and the evolution of a variety of rules of thumb (guided by more or less well founded prognostications) which are designed to steer the investor through complex considerations of yield and risk. Relatively little has been done, however, in devising adequate techniques, of a general kind, which can be used to determine optimum selections for a portfolio after the data have been analyzed, and after the predictions as well as the risk and yield criteria of the investor have been specified. The purpose of this paper is to analyze and explain, by reference to empirical data, some of the recent work done in this area by Dr. Harry Markowitz under the sponsorship of the Cowles Commission. 2 This article is divided into four parts. Part I contains a heuristic introduction to the basic problem together with a mathematical statement of Markowitz's theory of portfolio selection and its basic assumptions. Part II contains a discussion of some of the problems involved in formulating probability beliefs for available investment opportunities. En Part III, the selection technique is demonstrated by application to a very simplified case, and many of the problems involved in more complex cases are brought out. The final section contains a summarization and critique of the theory, its limitations, and its possibilities as a guide to practical decision-making. [ABSTRACT FROM AUTHOR]

The article presents a review of literature relating to decision theory. An article by Ward Edwards is cited. A book entitled "Decision Processes" by Thrall, Coombs and Davis is cited. The book "Theory of Games and Statistical Decisions" by David Blackwell and M. A. Girshick is cited, as is the book "Foundations of Statistics" by L. J. Savage. Both represent works by statisticians. Works by psychiatrists and psychoanalysts include a Princeton University doctoral dissertation by Marvin Minsky, and the work of Walter Pitts and his colleagues at the Massachusetts Institute of Technology Research Laboratory of Electronics. Works by Frederick Mosteller, R. R. Bush, W. K. Estes, John von Neumann, and Merrill M. Flood are referenced.

The article presents a review of research and literature in the area of mathematical solutions to programming problems in managerial science. The author defines the boundaries between science and mathematics. T. C. Koopmans and his colleagues at the Cowles Commission of the University of Chicago are cited as performing basic science. Other citations include Abraham Wald in statistical decision theory, John von Neumann and Morgenstern in the theory of games, and Leontiev in the field of inter-industry economics. On the mathematical side, the author cites George B. Dantzig of the "Simplex Method," and Richard Bellman. Professor A. W. Tucker of Princeton University is cited as being very active in the theory of games.

The article proposes that the U.S. federal government, which is similar to any large organization, improve internal communications through the adoption of a variety of management techniques. The problem is that different departments, having different areas of responsibility, often meet challenges with an unfocused and compartmented response. The article discusses the issue of language and terminology, and proposes that agencies adopt a language that can be used to state the framework, measure the parameters (constants), analyze the interactions, and express the results. For example, the words "industrial organic chemicals" must mean precisely the same thing in every context. The advantages of an integrated framework of analysis are presented, including progress in automation.

The article discusses management science with an emphasis on human psychology. The author states that reports by Jacob Marschak and Frederick Hertz focus on the logical aspects of team management, and overlook the human aspects. Two such aspects are the multiplicity and variability of the motives of administrators, and the psychological maintenance of the organization. The article states that the emotional needs of the people in the organization require attention. Workers may not need much information to be able to do their jobs properly, but they may need it to want to do their jobs properly. The article discusses the specialties of personnel management, employee relations, consumer relations, and community relations.

The article presents information on several papers related to management science that were presented in the first national meeting of the Institute of Management Sciences (MIT) that was held on October 21 and 22, 1954. The paper "Semantic Noise in an Information Processing Group," describes a series of experiments carried out at MIT to extend the basic concepts of Information Theory, and to gain further understanding of group communication processes. In these, a group performed a simple task which required the description in writing of objects which were difficult to describe precisely. The confusion and errors resulting were analyzed in terms of information theory, extended to the semantic level, and this extension shown proved to be applicable. Differences in performance between groups with different communication networks were investigated, and some of the relevant factors evaluated. Another paper "Elements for a Theory of Teams," focuses on decision making in a team.

The essential character of the general models under consideration is that activities are divided into two or more stages. The quantities of activities in the first stage are the only ones that are required to be determined; those in the second (or later) stages can not be determined in advance since they depend on the earlier stages and the random or uncertain demands which occur on or before the latter stage. It is important to note that the set of activities are assumed to be complete in the sense that, whatever be the choice of activities in the earlier stages (consistent with the restrictions applicable to their stage), there is a possible choice of activities in the latter stages. In other words it is not possible to get in a position where the programming problem admits of no solution. [ABSTRACT FROM AUTHOR]

En a previous paper', the problem of parts requirements was analyzed with the aid of matrix equations. En the present paper, this analysis is extended to include the time dependence of parts requirements. A system of equations is developed which relates to a given shipping schedule the schedule of requirements for each assembly, or subassembly. [ABSTRACT FROM AUTHOR]

The article reports on key issues relevant to the use of statistical techniques by middle management. A group of student economists taking the statistics course of the Executive Program of the University of Chicago during 1952, 1953, and 1954 were required by their professor, W. Allen Wallace, to turn in a term paper analyzing the effect communication patterns have upon the operation of groups. The author focuses on examining the information compiled from the term papers, including general problems that the students observed as well as inefficiencies generated in eight specific categories including business forecasting, predictive techniques, and scheduling and inventory control. Marketing techniques are called into question. Common mistakes made in the interpretation of data are also discussed.

This replication and extension of the work of Bavelas, Leavitt, and Smith on communication patterns in task-oriented groups enabled us to separate the effect of communication nets upon the performance of an operating task by the group, and upon the ability of the group to organize itself for this operating task. The particular nets we explored did not create differences among the groups with respect to the time needed for handling the operating task when an optimal organization was used. These same nets did introduce important differences in the organizing difficulties encountered. In this way we obtained an estimate, which can be refined through further experimentation, of the relative difficulties introduced by demanding the establishment of non-symmetric "keyman" roles, the organization of relay points, and the elimination of unnecessary channels. The current management literature on the topic of communication leaves one with the expectation that certainly a reduction in communication restrictions should lead to a more adequately functioning organization. Yet, our findings in this experiment indicate that assertion of a one-to-one relationship between effective functioning and freedom in communication is unwarranted. Had our analysis not separated the organizational problem from the operating problem, it would have seemed paradoxical that complete freedom of communication is at times more limiting than restricted communication. The findings warn the practical communications expert working in industry or government that a change in communications structure may have quite different consequences for the efficiency of immediate day-to-day operations, and for the ability of the organization to handle changes in its own structure. [ABSTRACT FROM AUTHOR]

The article reports on the creation of an axiomatization that explains the connection between the notion of utility differences and the theory of measurement of utility in economics. The author endeavors to produce a representative mathematical theorem in order to explain the connection, as well as separate the notion of utility from that of subjective probability. Experiments are used to measure the conditions that the author suspects are required for the existence of a cardinal utility function on a pair of dissimilar commodities. The author depends on a fundamental lemma to prove the existence of the representation theorem. Related experimental work conducted by psychologists and economists is also examined.

A supplement to the article "Smooth Patterns of Production," written by A.J. Hoffman and Walter Jacobs, which appeared in the first volume of the periodical "Management Science" published in 1954, is provided. The author suggests a method of interpreting the mathematical theorem used by Hoffman and Jacob to measure the cost of speeding up industrial product production. It is suggested that the conclusions reached in the initial article depend on the cumulative delivery requirement variable. The author also critiques an algorithm included in theorem 4, which deals with product management and scheduling and is also discussed in the aforementioned article by Hoffman and Jacobs.

Two letters to the editor are presented in response to articles published in the January 1955 issue.

The article reports on decision making methods that could have positively affected the quality of product production within a specific industrial corporation. The author focuses on information compiled by a research team that created a series of decision making skills for executives after observing the company for six-years. The methods are represented by a set of mathematical equations that have to do with scheduling and labor supply management. Each problem is accompanied by an optimal decision rule. The author compares the hypothetical performance of the company, the company's performance had the new decision making methods been implemented, with the company's actual performance. The company's profitability is examined through analysis of its payroll, hiring, and layoff costs.

The article cites a study conducted by the Industrial Relations Center of the University of Chicago, Illinois, which focuses on drawing a comparison between the management styles of two steel companies: Indiana Harbor Works, located in East Chicago, Indiana, and Dortmund-Hörde Huttenunion (DHHU), located in Dortmund, Germany. The companies are nearly the same size, in that they retain a similar number of employees, but the production standards experienced by DHHU are far greater than those of Inland. It is suggested that the reason for this divergence has to do with the use of different machinery and different manufacturing processes. A chart comparing top and middle management employees working at both companies is provided. The formal educational training of executives is discussed.

The article focuses on the applications of game theory in management science. Game theory is the process of studying decision making tendencies during conditions of conflict. The author focuses on situations during which individuals, or players, are forced to make decisions based on factors beyond their control. The example of a poker game is examined. The use of payoff matrices illustrates ways in which game theory can be applied to business planning in the production, distribution, and advertising industries. By using probability weightings, individuals can select a pure strategy or combine strategies to implement a mixed strategy. The solution of a linear program is compared to the solution of a two-person zero sum game. Mathematical equations that can be used to determine risk are provided.

The article reports on the mechanization of management and management science in the U.S. The author focuses on the need for instrumentation of production as well as machine management in the wake of technological advances within the industry. The author encourages managers to implement technology including automatic computers, automatic turret lathes, and remote control devices. He discusses the importance of operations research, as well as timely decision making on the part of management, in order to speed up the automation process. Elements of management training are mentioned. A quotation from Phillip Murray, former president of the Congress of Industrial Organizations, is included. The implementation of the technological innovations is referred to as the Second Industrial Revolution.

First we suggested that inventory control operations involve two separate types of decision problems. The tactical problem: how to control the supply of individual stock items in a way that most effectively achieves a particular awe- gate outcome; and the strategic problem: how to select among the attainable alternatives the specific outcome which is best related to the overall objectives and operational restrictions of the company. We have suggested, further, that while much excellent work has been done on the tactical problem, the typical approach to the strategic problem-involving the search for certain hypothetical costs-frequently leaves much to be desired. Finally, we suggested that for any given formulation it is possible to identify, either analytically or synthetically, the entire set of alternative outcomes that would be best. under some cost criterion and that direct executive selection from this set of alternatives frequently appears to bring about a better solution to the strategic decision problem. [ABSTRACT FROM AUTHOR]

The purpose of this paper is to discuss a number of functional equations which arise in the "optima) inventory" problem. This is a particular case of the general problem of ordering in the face of an uncertain future demand. Actually, an important aspect of the problem is that of determining a suitable criterion of cost, one which is both realistic and analytically malleable. In the following sections we shall consider various sets of assumptions which yield various functional equations, all belonging to a common family. [ABSTRACT FROM AUTHOR]

The article discusses the need for the development of mathematical tools for the precise and reliable measurement of work output. Such measurements are highly useful in working out an optimal production policy, particularly with respect to planning and scheduling. The author asserts that individual production workers affect production rates rather than quality. In the case of high-level craftsman, the reverse is true. Human behavioral variables and physical variables are discussed. A linear equation is presented that represents the production rate function, including the behavioral and physical variables in the production rate system and their region of variation.