Quantitative School Of Administration: What It Is, And Characteristics
Business management is one of the most current topics that we can find, although some of its models come from afar.
One of the most important is the quantitative school of management With this article we will be able to better understand its origin, what its main characteristics are and what advantages it gives us over other models.
What is the quantitative school of administration?
Within all business management models, that of the quantitative school of administration is the one that It is based on statistical models and computer simulations as a method for making decisions , so it does so based on quantifiable data, seeking greater precision and objectivity. Therefore, it is a model completely based on rational thinking.
The creation of the quantitative school of administration dates back to the mid-20th century, in the middle of the Second World War. In this context, Great Britain, within the side of the allies, was studying new ways of establishing strategies based on totally rational reasoning For this purpose they brought together experts from different areas, and this was how what would eventually be known as the quantitative school of administration was born.
The model proved so successful that numerous nations followed suit. And not only that, but after the war ended, this methodology continued to be used, already in another series of contexts far from belligerence, such as the industry itself. Thus, companies sought to rebuild themselves by taking advantage of the advantages that the quantitative school of administration gave them.
How is it possible that a method that was useful for war strategies is also useful for business strategies? Because, although the purposes are very different, the fundamentals remain the same: achieve the best results based on objective data. And it is that The key to this model is the quantitative sense, that is, measurable and verifiable a characteristic that other methods suffer from.
Although we have already anticipated some of them, we are now going to look in more detail at the main characteristics that make the administrative quantitative school so special, and that differentiate it from other series of methodological approaches.
1. Rational thinking
As we saw, the key that defines the administrative quantitative school is the constant use of rational thinking. All problems must be analyzed from an objective point of view , which allows all variables to be quantified in a measurable and analysable way. Furthermore, following this dynamic, we can compare some situations with others and assess the effectiveness of the results in an objective way.
2. Different disciplines
Another of the hallmarks of the administrative quantitative school is the use of very diverse perspectives, depending on the area of ​​the discipline that is used for focus at any given time. In this way we can obtain different visions, all of them based on statistical data, to be able to make a decision with maximum information and also the most reliable.
3. Prediction
Both in the business field and in many others, there is a huge number of variables that we must always take into account when looking for the best strategy that allows us to achieve our objectives. The quantitative school of administration It has the advantage of providing us with a prediction in the form of the probability of appearance of each of these variables which is of vital importance to have vital statistical information that will help us take one path or another.
Techniques used
We have seen the general lines that define the quantitative school of administration. Now we are going to better understand which are the most frequently used techniques within the framework of this methodology.
1. Econometrics
This tool is based on the use of statistics that gives us the standardization that we seek to better understand the market in which our organization operates. Thanks to econometrics, predictions can be made based on specific data that substantiate them.
The probability index is another of the most powerful tools of this school. By obtaining the probabilities of occurrence of each variable that we handle in the model we can decide the strategies to follow with the confidence of having followed an objective reasoning process.
3. Wait
The waiting queue is a mechanism through which the cost of carrying out the production and the cost of waiting until it is carried out are taken into account, in order to achieve the most favorable balance point to help us decide the best time to start producing the goods or services that our company offers.
4. Dynamism
Another tool used in the quantitative school of administration is programming according to dynamism. It is intended to be used in cases where, having previously established a final objective, it has been altered in one of the stages of production, so the dynamic approach is used to update our goal and thus adapt quickly to the new situation.
5. Linear production
You can also resort to linear programming regarding the production system. The objective of this method is make it economically involve the lowest costs that the system allows and thus be more efficient and achieve greater benefits by offering the same product, but produced through fully optimized resources.
6. Game theory
Game theory would be the cornerstone of the quantitative school of management. Thanks to it, we can influence any problem that we find in the organization and address it in a mathematical way and therefore with the greatest possible precision, so that The chosen solution will always be given by the results matrix obtained and we will have statistical support behind it.
Mathematical models
It has become clear that the basis of the quantitative school of administration is its statistical foundations to be able to make rational decisions. Let’s now get to know some of the mathematical models on which they are based.
1. Operational research
The first model we find is operational or operations research, which helps make decisions under very exhaustive analysis. This model It is part of the branch of applied mathematics, and is one of the most popular ones used to search for optimal decisions Like the quantitative school of administration itself, its birth was also the result of research carried out in the United Kingdom during World War II.
Decision theories are also taken into account, another model that, in this case, draws on different disciplines, such as Psychology, Economics and Administration. In this way they have different perspectives to support the decision in the most complete way.
3. Electronic data processing
Of course, the quantitative school of management also relies on electronic data processing, or PED. Thanks to this system, Huge amounts of data can be processed in a simple and fast way and obtain statistical data of great value to establish our objectives and strategies to carry them out.
4. Administrative science
As is evident, since it is part of its own nomenclature, administration or administrative science is another of the pillars of this school. And it is that The entire standardized methodology behind planning, organizing, directing and controlling each company resource is directly nourished by the methodology of this science Only in this way can we achieve the optimization and efficiency levels that we seek with the quantitative school of administration.
5. Statistical methods
Finally, the statistical mathematical model is essential for the development of the mechanisms of this school, an issue that we have already developed in the different points of this article. And it is that Statistics is the basis and the main weapon of this methodology since it is the model that allows us to carry out all the functions that we have seen and lead to the rationally based decisions that we saw previously.
Conclusion
After developing the characteristics, the techniques used and the mathematical models on which the quantitative school of administration is based, we can now establish the global idea of ​​its foundations and objectives. What must be clear is the mathematical basis, especially statistics, that provides this model with the strength of standardization and quantification with which we will be able to address the issues that affect our company, making the optimal decisions to resolve them.
