The six finalists competing to win the 2005 Franz Edelman Award for Achievement in Operations Research and the Management Sciences show a marked contrast in the ways that a major sports enterprise, an Asian university, and four major corporations approach innovation in the 21st century.
The finalists, announced last month by the Institute for Operations Research and the Management Sciences (INFORMS®), are the Athens 2004 Olympic Committee, Eli Lilly¸ General Motors, Nanzan Educational Complex, Procter & Gamble, and Swift & Co.
The annual contest highlights innovations in organizations that are profit and non-profit, in the U.S. and across the world, and frequently identifies new trends in business and government. This is the 34th year of the prestigious competition, which has recognized techniques that have changed our technical and business landscape.
Operations Research, known as the "science of better," is the discipline of applying advanced analytical methods to help make better decisions.
The 2005 finalists will compete in Palm Springs for the Franz Edelman Award, which is presented by INFORMS and CPMS, the Practice Section of INFORMS. The Edelman competition takes place Monday, April 18. The winner will be announced Tuesday, April 19.
Descriptions of this year'TMs finalists follow.
The ATHENS 2004 Organizing Committee for the Olympic Games (ATHOC): The 2004 Olympic Games brought together a daunting 10,862 athletes, 16,524 media representatives, and 3.6 million ticket holders. Anticipating an enormously complex planning challenge, the Committee, working with the Athens University of Economics and Business and The Manchester University, created a new approach, appropriately named "PLATO."
PLATO helped ATHOC use a systematic, rational, repeatable method; evaluate key resource requirements rather than relying on past examples; and become a more agile organization that evaluated alternative solutions to emerging problems.
PLATO produced overall time and cost saving and reduced required resources without compromising level of service. Its assistance managing operations design contributed an additional savings.
Eli Lilly: Antifolates are among the most promising potential anticancer agents but they carry varied risks of toxicity; although rarely occurring, the combination of toxicities can result in death. Eli Lily was forced to halt clinical development of its antifolate ALIMTA, despite observed anti-tumor activity and more than $300 million invested.
Operations research helped Eli Lilly resume testing. In addition to collecting standard clinical data, Eli Lilly researchers in the phase 2 clinical development of ALIMTA began collecting patient vitamin deficiency markers and using operations research methods to identify severe toxicities, allowing researchers to quantify the relative risks.
As a result, the safety of ALIMTA was profoundly improved. In 2004, ALIMTA was approved both in the U.S. and the European Community for treatment of the asbestos-related, difficult-to-treat cancer mesothelioma - ALIMTA is the first and only drug approved - and, with initial chemotherapy, for lung cancer after disease progression. ALIMTA is now under broad clinical investigation worldwide for treatment of other common cancers such as breast, colorectal, and head and neck cancers.
General Motors: Using operations research to achieve one of its signature benefits, greater efficiency, GM saved over $800 million through improved productivity at 30 company plants in 10 countries. The savings were realized using novel, state-of-the-art algorithms and modeling systems developed for estimating throughput performance, identifying bottlenecks, and buffer allocation, coupled with improved, global deployment of data collection and performance improvement processes.
Nanzan Educational Complex, working with its parent Nanzan University, developed an educational planning system to cope with alarming national trends in higher education. In Japan, the number of students entering universities is shrinking, due to a declining birth rate. Some private universities cannot utilize their full capacity and many universities are facing financial difficulties. Against this backdrop Nanzan has been expanding and working with its operations research faculty to grow intelligently.
Nanzan uses operations research to plan the layout of its new campus for maximum convenience and efficiency, adjust the size of new buildings so theyâ€TMre not overbuilt, schedule classes to spare students and professors from commuting during rush hour, reduce the fleet of buses required on-campus, and assign faculty and administration for tasks like proctoring standardized exams. As a result, operations research methodology is improving management of the entire campus.
Procter & Gamble, working with CombineNet Inc. and Carnegie Mellon University, realized $305 million in savings (14.3% of $2.13 billion spent) from a next-generation procurement process that relies on operations research techniques like applied optimization.
Operations research was used for market clearing in a generalization of combinatorial auctions that CombineNet calls expressive competition. Combinatorial auctions let bidders - in this case, suppliers - bid on bundles of items, thus allowing them to consider complimentary and substitute items. P&G and its partners used CombineNet's ClearBox, enabling bidders to use discount schedules and capacity constraints, and enabling the company to express constraints and preferences. The auctions are massive, ranging up to tens of thousands of items, hundreds of thousands of constraints, and an equally large number of bids. Expressive competition allows procurement specialists to get results in seconds, not months, and explore more alternatives. The process helps drive out unnecessary costs, find new savings opportunities, and build long-term supplier relationships. The technology provides a win-win, with suppliers benefiting, as well.
Swift & Co., working with Aspen Technology, brought operations research models to yet another industry, improving their beef cutting scheduling and order committing capabilities, thus adding 13% to their bottom-line profits. An integrated system of 45 linear programming models using three separate model formulations allows Swift & Company to dynamically schedule beef fabrication operations at five plants in real time as orders are received. This scheduling and capable-to-promise application has made Swift & Company a supplier of choice while providing a 200% ROI in its first year of production.
The Edelman Award recognizes outstanding implemented operations research that has had a significant, positive impact on the performance of a client organization. The top finalist receives a $10,000 first prize. Last year, Motorola and Emptoris were recognized for achieving increased productivity and reduced costs at the electronics manufacturer. Previous winners include Continental Airlines, Canadian Pacific Railroad, and Sabre Decision Technologies.
The 2005 competition is being held at an INFORMS conference, "Applying Science to the Art of Business," which takes place at The Westin Mission Hills Resort in Rancho Mirage near Palm Springs, California from April 17-19. Information about the conference is online at http://informs.org/Conf/Practice2005
The finalist papers will be published in the January, 2006 issue of the INFORMS publication Interfaces. Recent Edelman finalists can be viewed at www.scienceofbetter.org.
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The Institute for Operations Research and the Management Sciences (INFORMS®) is an international scientific society with 10,000 members, including Nobel Prize laureates, dedicated to applying scientific methods to help improve decision-making, management, and operations. Members of INFORMS work in business, government, and academia. They are represented in fields as diverse as airlines, health care, law enforcement, the military, financial engineering, and telecommunications. The INFORMS website is www.informs.org. More information about operations research is at www.scienceofbetter.org.
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