Operations Research Analysts

Significant Points

  • Individuals with a master’s or Ph.D. degree in management science, operations research, or a closely related field should have good job prospects.
  • Employment growth is projected to be slower than average.

Nature of the Work [About this section]  Index

Operations research (OR) and management science are terms that are used interchangeably to describe the discipline of applying quantitative techniques to make decisions and solve problems. Many methods used in operations research were developed during World War II to help take the guesswork out of missions such as deploying radar, searching for enemy submarines, and getting supplies where they were most needed. Following the war, numerous peacetime applications emerged, leading to the use of OR and management science in many industries and occupations.

The prevalence of operations research in the Nation’s economy reflects the growing complexity of managing large organizations that require the efficient use of materials, equipment, and people. OR analysts determine the optimal means of coordinating these elements to achieve specified goals by applying mathematical principles to organizational problems. They solve problems in different ways and propose alternative solutions to management, which then chooses the course of action that best meets their goals. In general, OR analysts are concerned with issues such as strategy, forecasting, resource allocation, facilities layout, inventory control, personnel schedules, and distribution systems.

The duties of the operations research analyst vary according to the structure and management philosophy of the employer or client. Some firms centralize operations research in one department; others use operations research in each division. Some organizations contract operations research services with a consulting firm. Economists, systems analysts, mathematicians, industrial engineers, and others may apply operations research techniques to address problems in their respective fields. Operations research analysts may also work closely with senior managers to identify and solve a variety of problems.

Regardless of the type or structure of the client organization, operations research in its classical role of carrying out analysis to support management’s quest for performance improvement entails a similar set of procedures. Managers begin the process by describing the symptoms of a problem to the analyst, who then formally defines the problem. For example, an operations research analyst for an auto manufacturer may be asked to determine the best inventory level for each of the parts needed on a production line and to determine the number of windshields to be kept in inventory. Too many windshields would be wasteful and expensive, while too few could result in an unintended halt in production.

Operations research analysts study such problems, then break them into their component parts. Analysts then gather information about each of these parts from a variety of sources. To determine the most efficient amount of inventory to be kept on hand, for example, OR analysts might talk with engineers about production levels, discuss purchasing arrangements with buyers, and examine data on storage costs provided by the accounting department.

With this information in hand, the analyst is ready to select the most appropriate analytical technique. Analysts could use several techniques—including simulation, linear and non-linear optimization, networks, waiting lines, discrete and random variables methods, dynamic programming, queuing models and other stochastic-process models, Markov decision processes, econometric methods, data envelopment analysis, neural networks, genetic algorithms, decision analysis, and the analytic hierarchy process. All of these techniques, however, involve the construction of a mathematical model that attempts to describe the system in use. The use of models enables the analyst to assign values to the different components, and determine the relationships between them. These values can be altered to examine what will happen to the system under different circumstances.

In most cases, the computer program used to solve the model must be modified repeatedly to reflect these different solutions. A model for airline flight scheduling, for example, might include variables for the cities to be connected, amount of fuel required to fly the routes, projected levels of passenger demand, varying ticket and fuel prices, pilot scheduling, and maintenance costs. By choosing different variables for the model, the analyst is able to produce the best flight schedule consistent with various sets of assumptions.

Upon concluding the analysis, the operations research analyst presents management with recommendations based on the results of the analysis. Additional computer programming based on different assumptions may be needed to help select the best recommendation offered by the OR analyst. Once management reaches a decision, the analyst may work with others in the organization to ensure the plan’s successful implementation.

Working Conditions [About this section]  Index

Operations research analysts generally work regular hours in an office environment. Because they work on projects that are of immediate interest to top management, OR analysts often are under pressure to meet deadlines and work more than a 40-hour week.

Employment [About this section]  Index

Operations research analysts held about 76,000 jobs in 1998. Major employers include telecommunication companies, air carriers, computer and data processing services, financial institutions, insurance carriers, engineering and management services firms, and the Federal Government. Most operations research analysts in the Federal Government work for the Armed Forces, and many OR analysts in private industry work directly or indirectly on national defense. About 1 out of 5 analysts work for management, research, public relations, and testing agencies that do operations research consulting.

Training, Other Qualifications, & Advancement [About this section]  Index

Employers generally prefer applicants with at least a master’s degree in operations research, engineering, business, mathematics, information systems, or management science, coupled with a bachelor’s degree in computer science or a quantitative discipline such as economics, mathematics, or statistics. Dual graduate degrees in operations research and computer science are especially attractive to employers. Operations research analysts also must be able to think logically and work well with people, and employers prefer workers with good oral and written communication skills.

In addition to formal education, employers often sponsor training for experienced workers, helping them keep up with new developments in OR techniques and computer science. Some analysts attend advanced university classes on these subjects at their employer’s expense.

Because computers are the most important tools for quantitative analysis, training and experience in programming are required. Operations research analysts typically need to be proficient in database collection and management, programming, and in the development and use of sophisticated software programs.

Beginning analysts usually perform routine work under the supervision of more experienced analysts. As they gain knowledge and experience, they are assigned more complex tasks and given greater autonomy to design models and solve problems. Operations research analysts advance by assuming positions as technical specialists or supervisors. The skills acquired by operations research analysts are useful for higher-level management jobs, and experienced analysts may leave the field to assume nontechnical managerial or administrative positions.

Job Outlook [About this section]  Index

Individuals who hold a master’s or Ph.D. degree in operations research, management science, or a closely related field should find good job opportunities through 2008, as the number of openings generated by employment growth and the need to replace those leaving the occupation is expected to exceed the number of persons graduating with these credentials. In addition, graduates with bachelor’s degrees in operations research or management science from the limited number of schools offering these degree programs should find opportunities in a variety of related fields that allow them to use their quantitative abilities.

The slower than average employment growth expected for OR analysts will be driven by the continuing use of operations research and management science techniques to improve productivity, ensure quality, and reduce costs in private industry and government. This should result in a steady demand for workers knowledgeable in operations research techniques in the years ahead. Nevertheless, this growth will be relatively slow because few job openings in this field are expected to have the title operations research analyst.

Earnings [About this section]  Index

Median annual earnings of OR analysts were $49,070 in 1998. The middle 50 percent earned between $36,890 and $72,090. The lowest 10 percent had earnings of less than $29,780, while the top 10 percent earned over $87,720. Median annual earnings in the industries employing the largest number of OR analysts in 1997 are shown below.

Research and testing services  $64,000
Computer and data processing services  45,400
Commercial banks  37,500

The average annual salary for operations research analysts in the Federal Government in nonsupervisory, supervisory, and managerial positions was $72,000 in early 1999.

Related Occupations [About this section]  Index

Operations research analysts apply mathematical principles to large, complicated problems. Workers in other occupations that stress quantitative analysis include computer scientists, systems analysts, modeling specialists, logistics consultants, engineers, mathematicians, statisticians, and economists. Because its goal is improved organizational effectiveness, operations research also is closely allied to managerial occupations.

Sources of Additional Information [About this section]  Index

Disclaimer: Links to other Internet sites are provided for your convenience and do not constitute an endorsement.

Information on career opportunities for operations research analysts is available from:

  • The Institute for Operations Research and the Management Sciences, 901 Elkridge Landing Rd., Suite 400, Linthicum, MD 21090. Internet: http://www.informs.org

For information on OR careers in the Armed Forces and Department of Defense, contact:

  • Military Operations Research Society, 101 South Whiting St., Suite 202, Alexandria, VA 22304. Internet: http://www.mors.org

An industry employing operations research analysts that appears in the 2000-01 Career Guide to Industries: Computer and data processing services

O*NET Codes: 25302 About the O*NET codes

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