Inspired by a post on this forum in which someone mentioned how they run models to schedule their spouse's nursing crew, I was wondering if anyone makes a buck by doing small scale work, or if anyone has thoughts on small scale opportunities?

It seems to me that OR has heretofore required large enough start up costs that a business has to be the size of a small railroad conglomerate to make worrying about it worthwhile, but with NEOS, glpk, COIN-OR, etc, it seems that modeling small and mid-sized problems might be a real possibility. There are plenty of 100 person machine shops just dying for job-shop models (right?), and saving an FTE or two per year at a place of that size could be a big enough benefit to try it.

I would imagine the hurdles might be more cultural than technical, both on the modeler and the "modelee" sides. In the former, technicians may be too ready to pronounce that the model is finished and that it must be implemented exactly as written, and on the user side, smaller scale businesses might be more comfortable doing their work intuitively.


asked 04 Jan '12, 21:41

forkandwait's gravatar image

accept rate: 100%

There is also the cost of labor to consider, which could easily exceed the cost of off-the-shelf software. Also, the risk associated with starting a software project from scratch can be difficult to estimate.

I think the best way to push OR to small business is to have off-the-shelf solutions tailored to individual problem areas, distributing development cost over many end users.


answered 05 Jan '12, 02:06

Rune%20Sandvik's gravatar image

Rune Sandvik
accept rate: 0%


Absolutely right, the OP seem to focus on software cost, but the real cost is labour. Besides the greatest barrier for small business to use OR is lack of in house knowledge, they fear to be drowned in consultant expenses.

(05 Jan '12, 02:22) Bo Jensen ♦

Is there any off the shelf software for small scale problems? Say for routing 25 school buses or optimizing vegetable produce inventory at three stores or whatever? Seems like here is where there would be a niche for custom modeling -- 100 lines of AMPL and a person to explain it.

I personally think that off the shelf software is overrated -- it is either expensive or requires customization to be useful (usually both).

(05 Jan '12, 12:44) forkandwait

There are some tasks sufficiently standard that off-the-shelf software may be fine, but I suspect that there are other problems encountered by SMB where (a) they need an OR analyst to help them figure out what the problem is and (b) their specific situation contains one or more wrinkles that would make it difficult to use off-the-shelf software.

(05 Jan '12, 16:26) Paul Rubin ♦♦

Despite the cost of labour, small scale environments are the kind of place full of opportunities for someone who is just starting and wants to develop a portfolio. Be it small or big, I think that deciding when to stop perfecting a model or a home-made solver is always a tough decision ("what if I try a little harder and find a solution 20% better!?") and gaining experience on that is always important. Besides, working for free in such environments also represents an opportunity to spread the word about O.R. with applications that the end user would not be able to afford otherwise.

Quoting @Paul Rubin (Hitting the Muggles from All Sides),

This is the direction that I think is most often overlooked. Small to medium businesses (SMBs), small non-profits and small governmental institutions (think your local school district) are probably underserved by the operations research community, particularly as they may tend not to be lucrative potential clients for consultancies. The key decision makers are often not business school graduates, and may have no idea that O.R. and analytics even exist (unless they know "analytics" in the sense of parsing web server logs). Presentations at local Chamber of Commerce meetings, participation in local business forums (do your local businesses have a LinkedIn group?), and even pro-bono consulting will help show people both what O.R. is about and how it can pay off. My guess is that this group is particularly ripe for word-of-mouth marketing.

As I said, this segment is probably not particularly lucrative monetarily. Every once in a while, though, one of those SMBs will take off and become a large company; hopefully they will remember the role O.R. played in their growth. Organizations in this category that benefit from O.R. help may also have the ear of politicians and university administrators, which may foster some growth in O.R. curricula. Finally, press reports of success stories at this level may catch the eyes of executives in larger firms.


answered 05 Jan '12, 06:55

Thiago%20Serra's gravatar image

Thiago Serra
accept rate: 1%

I worked in financial markets research for 2.5 yrs and recently graduated with an OR degree and most companies need full time experience for entry level OR analyst(How Ironic!!) so got myself an internship where I develop prototypes which are already built as applications in industry. Point is, the company does not have to pay to buy the existing software. Would anyone like to hire me? I will provide OR solutions and develop models for your business. Give the young professionals a chance to deliver!


answered 05 Jan '12, 08:27

Pavan's gravatar image

accept rate: 0%

Where in the world are you?

(05 Jan '12, 10:16) Thiago Serra

I am in India. Well, location shouldn't be a problem.

(06 Jan '12, 06:40) Pavan

IBM and GE have recently installed research centers in Brazil. I know for sure that IBM is hiring people to work with O.R. here. Besides, there are some Brazilian consulting companies like Neolog, Gapso and Unisoma that you can also try to reach. Anyway, I overheard that getting a Brazilian working visa involves a lot of bureaucracy and takes a long time.

(06 Jan '12, 07:31) Thiago Serra

Thanks Thiago, really appreciate it...!

(06 Jan '12, 07:53) Pavan
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Asked: 04 Jan '12, 21:41

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Last updated: 06 Jan '12, 07:53

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