This discussion thread is worth one extra credit point on the midterm - and may help you answer an essay question on the midterm. Please respond to this thread by October 27, but ongoing discussion is always allowed and appreciated.

In Case Problem one, we simply added up the profit contributions for the Holiday Mix, the Deluxe Mix, and the Regular Mix (of nuts). By the very nature of linear programming, we assumed no interaction between the various terms being added together in the objective function.

MBA (and project management) programs are rather typical of this - simply add together the contributions of the various components, and as long as each component does their best, all we have to do is add together these components and we will have an optimal whole!

In what cases might this be a fallacy? For example, what is the impact if the travel department attempts to optimize its costs? Might that negatively impact other departments?

Why is it that the whole rarely even equals the sum of its parts, let alone be more than the sum of the parts?

We will do an in class exercise on October 27 that will force you to examine the issue of interactions. In preparation for that, please record your thoughts here. Good luck, and have fun.

In my opinion, the main reason the whole never equals the sum of its parts is because we are rarely all working towards the same goal. Every person, every organization and every manager attempts to optimize what is in their or their organizations interest. This may at times be harmless, however, it may also result in the organization failing repeatedly to meet its goals or milestones. Every day I see a schedule that is supposed to be optimized for the company's goals, yet every day I see managers argue and scheduling change. The result of shifting priorities is always inefficiency and a less than optimal solution. Furthermore, this gives the workforce the impression that management doesnt know what it wants which results in a workforce that is working at a less than optimal pace.

Re. the Nut Problem - so many factors were not entered into the equation:
cost of nuts on the commodities market; striking Teamsters workers and thus transportation delays from market to buyer; etc.

Re. Travel Dept. issues within corporations: I recently attended a one and a half day seminar in Boston, Ma. that took over 2 days of travel across country, with a connection in Denver, that did not factor in length of the terminal and the close connection times. Thus, the travel time was longer than the length of the seminar, and included an unexpected overnight stay.

Other, less tangible, factors that influence the "numbers": worker attitude and level of education (not everyone is created equal or produces equally), management communication skills and degree of involvement in production (which often affects workers' attitudes and productivity and can contribute to, or prevent, delays).

Personal experience: in healthcare, administrative members often want to assign a numerical value to nurses' productivity (caseload - number of patients to care for) without taking into consideration the acuity level (degree of illness and care required) of each individual patient. Thus, their productivity expectations (reflected numerically) are rarely accurate; and, often the answer is not to just hire more bodies to do the work.

Anita Alston

In what cases might this be a fallacy? For example, what is the impact if the travel department attempts to optimize its costs? Might that negatively impact other departments?

Why is it that the whole rarely even equals the sum of its parts, let alone be more than the sum of the parts?

This is a fallacy in most cases in business. For example, Quality wants the supplier with the highest quality. Purchasing wants the supplier with the lowest cost. The best outcome for the company is the lowest cost supplier with the highest quality. Since this combination rarely exists, you make the best tradeoff between the two, preferably looking at total cost of ownership, not piece cost.

linear programming can be a fallacy. The value given does not take into account of the probabilities along the way.
In the example, if one department optimizes its cost, another department may and/or will have to do without. The "probability" of keeping all departments happy is not taken into account.

Next item-for this one I would have to use the "home" for the "whole part". Hurricane Katrina-people lost their homes. All of the personal belongings are the parts to this whole home (and we treasure our personal items very much). But yet, a home in value, can be replaced monetarily, before the personal belongings (the parts). So, when I person lives in an area where hurricanes are known, they take the chance, that a hurricane "probably" won't affect them.

In other words, when we lose the parts to the "whole", replacing the "parts" can be more, than replacing the "whole". Thus, the "whole" and "parts" do not equal each other.

I've been thinking about the issue of inter-relations and how they can definitely affect linear programming. It's nice to have a model that tells you how things should work under perfect conditions, but competing interests and priorities can affect streamlining production and efficiencies. One example in my work is special events. We have produced performance measures to determine how many events our staff can handle and how quickly they can be done. When we developed our model, we based it on the assumption of some support items like interactive maps for organizers to use and a fully functioning software program. This hasn't happened, due to the fact that other departments, where we need the help from to produce these items have other priorities and interests. We are now forced to go down and walk each event organizer through the venue, for each event, instead of having interactive maps for them to use. This causes more staff time and throws off our production model. The same is true for our software. We have to hand carry approval papers from department to department, instead of those pieces being electronically disseminated through software. This can happen over and over again when organizational goals from department to department have competing interests.

In my opinion, the main reason the whole never equals the sum of its parts is because we are rarely all working towards the same goal. Every person, every organization and every manager attempts to optimize what is in their or their organizations interest. This may at times be harmless, however, it may also result in the organization failing repeatedly to meet its goals or milestones. Every day I see a schedule that is supposed to be optimized for the company's goals, yet every day I see managers argue and scheduling change. The result of shifting priorities is always inefficiency and a less than optimal solution. Furthermore, this gives the workforce the impression that management doesnt know what it wants which results in a workforce that is working at a less than optimal pace.

I have to agree with Chris on this one. As we discussed in class, managers are usually not provided training and insight to thinking from a system perspective. Since I am a Scholtes supporter (Scholtes is also a Deming disciple), one of the new competencies that Scholtes says that managers must have is being able to view the process, operation, or organization as a system with each component or part playing a vital role in meeting the objective. To improve the process, operation, or organization, one must be able to understand the system and all its inter-related parts. In the TJ's case study that we just completed, we looked at the process from purely the linear prospective of maximizing profit. This does not take into account all the other activities (direct labor, materials, and overhead support) in the TJ's organization that is required to produce, market, sell, and distribute the three mixes to actually achieve the profit maximization. So as Chris has so aptly articulated, if managers in the other organizations in TJ's are not in tune with the profit maximization strategy, success in meeting this objective will not occur.

Having always worked "outside" the government contractor world, until five years ago, I feel I have a newcomers outlook. It still amazes me, even after the past five years, how the sum of the parts do not add up to the whole! In my company there are so many layers of management that the actual work and goal is often lost in the processes that are required. Procedures are often the problem. Many times these procedures have been in place for so long that they no longer fill a need or lend themselves to achieving the ultimate outcome in the most efficient manner. The many departments/levels that one must navigate often becomes the anchor that weighs us down and does not allow for success. I am in the contracts department and during our "year end" buying frenzy the department interactions swing both ways. Either we are their saviors or their demise. We either save there butts or place the noose around their necks. However, we do not have the parts to complete the "whole". Each person seems to be out for themselves and we are at their mercy. It would seem that there has to be a better way. I know that the current system is not as successful as it should be. Planning and taking the time to "touch base" with the parts will only have positive affects on the outcome.

Jo-Ann Neely MC506

This is a fallacy in most cases in business. For example, Quality wants the supplier with the highest quality. Purchasing wants the supplier with the lowest cost. The best outcome for the company is the lowest cost supplier with the highest quality. Since this combination rarely exists, you make the best tradeoff between the two, preferably looking at total cost of ownership, not piece cost.
You are thinking in the right direction, but you haven't quite caught the "flavor" of how a top manager really ought to think.

We top managers look for the following trait when we recruit new faces:
Someone who not only recognizes the inefficiencies in an organization, but who can make a compelling case for a manager to implement a solution.

You are correct when you describe many purchasing departments focused on lowest acquisition cost for supplies, while production and quality departments are focused on supplies which give them the least grief in use as components or service supplies (MRO = Maintenance, Repair, Operations.)

The clever top manager would merely tweak the definition of cost to mean "cost in place" by factoring in all the soft costs of product quality and of dealing with suppliers who are unresponsive and adversarial. The clever top manager would then task purchasing, production, and quality to collaborate on deriving the REAL "cost in place" in selecting and retaining suppliers.

The smart and clever department heads would collaborate with the suppliers, telling them the new criteria and enlisting their cooperation in satisfying the top manager's definition.

Definitely, everyone has to be in the "loop" for a "cost in place" initiative to succeed.

You are thinking in the right direction, but you haven't quite caught the "flavor" of how a top manager really ought to think.
It's not clear what you mean by "top manager" (i.e., "top" in a company hierarchy or in the universal population of managers), but I think Miner stated the concept nicely and concisely.

We top managers look for the following trait when we recruit new faces:
Someone who not only recognizes the inefficiencies in an organization, but who can make a compelling case for a manager to implement a solution.
There's that "top manager" thing again. I think it's safe to say that relatively few managers look for people who will tell them about their institutional inefficiencies. Most, I fear, have bestowed the title of "top manager" upon themselves and look for sycophants to provide some verisimilitude. Of course one has to agree that an ideal manager would look for the traits you describe, but American manufacturing didn't get into the state it's in because of an excess of "top" managers.

The clever top manager would merely tweak the definition of cost to mean "cost in place" by factoring in all the soft costs of product quality and of dealing with suppliers who are unresponsive and adversarial. The clever top manager would then task purchasing, production, and quality to collaborate on deriving the REAL "cost in place" in selecting and retaining suppliers.
Top managers never use task as a verb:D . Your "cost in place" is what Miner described as "total cost of ownership." Same concept, different words.

There's that "top manager" thing again. I think it's safe to say that relatively few managers look for people who will tell them about their institutional inefficiencies. Most, I fear, have bestowed the title of "top manager" upon themselves and look for sycophants to provide some verisimilitude. .
:applause: Very imprssive Jim. You say it like it is without offending anyone.

Top managers never use task as a verb:D . Your "cost in place" is what Miner described as "total cost of ownership." Same concept, different words.
...you mean he isn't really a "top manager"? :D

...you mean he isn't really a "top manager"? :D

Not at all. Wes's success speaks for itself, and his perspectives often help us to see things a different way, and that's always a good thing. It's just that use of words like "task" and "leverage" as verbs is like fingernails on a blackboard to my admittedly pedantic and oversensitive ears.

Hi Everyone,
Very interesting discussions...it pays to come in the day before class!
As far as the case study goes, realistically in business there are so many things that affect sales; orders received, production levels, worker attitudes, hurricanes...even the best top managers do not have a crystal ball. A manager must build into their "plan" provisions for those little surprises. One thing we discussed within our group is what would happen if the surplus was not sold and the company was stuck with the huge amounts of nut mixes. One of those things you could count on in this scenario, sales will exceed production levels, would not be something you could count on in real life... you just never know what tomorrow is going to bring. We can all try to plan and even have some level of probability but sometimes you just have to roll with the punches.
Lori b

In my opinion, the main reason the whole never equals the sum of its parts is because we are rarely all working towards the same goal. Every person, every organization and every manager attempts to optimize what is in their or their organizations interest. This may at times be harmless, however, it may also result in the organization failing repeatedly to meet its goals or milestones. Every day I see a schedule that is supposed to be optimized for the company's goals, yet every day I see managers argue and scheduling change. The result of shifting priorities is always inefficiency and a less than optimal solution. Furthermore, this gives the workforce the impression that management doesnt know what it wants which results in a workforce that is working at a less than optimal pace.

I enjoyed reading your response. Nicely stated!
See you in class on Wed.
Melissa A. Wester

linear programming can be a fallacy. The value given does not take into account of the probabilities along the way.
In the example, if one department optimizes its cost, another department may and/or will have to do without. The "probability" of keeping all departments happy is not taken into account.

Next item-for this one I would have to use the "home" for the "whole part". Hurricane Katrina-people lost their homes. All of the personal belongings are the parts to this whole home (and we treasure our personal items very much). But yet, a home in value, can be replaced monetarily, before the personal belongings (the parts). So, when I person lives in an area where hurricanes are known, they take the chance, that a hurricane "probably" won't affect them.

In other words, when we lose the parts to the "whole", replacing the "parts" can be more, than replacing the "whole". Thus, the "whole" and "parts" do not equal each other.

Great Response!
See you in class Wed.
Melissa A. Wester

This discussion thread is worth one extra credit point on the midterm - and may help you answer an essay question on the midterm. Please respond to this thread by October 27, but ongoing discussion is always allowed and appreciated.

In Case Problem one, we simply added up the profit contributions for the Holiday Mix, the Deluxe Mix, and the Regular Mix (of nuts). By the very nature of linear programming, we assumed no interaction between the various terms being added together in the objective function.

MBA (and project management) programs are rather typical of this - simply add together the contributions of the various components, and as long as each component does their best, all we have to do is add together these components and we will have an optimal whole!

In what cases might this be a fallacy? For example, what is the impact if the travel department attempts to optimize its costs? Might that negatively impact other departments?

Why is it that the whole rarely even equals the sum of its parts, let alone be more than the sum of the parts?

We will do an in class exercise on October 27 that will force you to examine the issue of interactions. In preparation for that, please record your thoughts here. Good luck, and have fun.


O.K. I think I am finally getting this. Will someone please let me know if any of this does not make sense...That way I will know if I am getting this or not!

In my opinion, the reason why the whole rarely even equals the sum of it's parts is because each of the parts are too busy trying to be the largest part of the whole. For example, when I worked for T***** the whole was broken into 2 parts; the "Store Side" and the "Security Side" The store side contributed a great deal to the whole and they did what ever they could to keep it that way. Security contributed very little (if at all) to the objective function, but it saved the whole millions in loss profit. Although this is a known fact, it is not recognized as a contributing factor by the store side. The optimal solution to the greatest objective function between these 2 parts of the whole would be to contribute equally; by working together! Basically, each part contributes unequally inorder to make a whole. That can never be broken down and distributed equally to each of the parts. Each part of the whole have some interaction because they are not equal. For example, in Case Problem 1, each unequal part (R.D.H) made a whole (Objective Function) The Linear program allowed us to see that each part was unequal in contributions to the whole, and at the optimal solution (what's in best interest for the whole!)

See you all on Wed.

One thought - in order to optimize the WHOLE, it may be necessary for an individual component to take a loss. For example, one company ran an in-house cafeteria, selling food for below cost. Why? Because when the employees ate at the in-house cafeteria, they generally spent less time away from their desk than if they went farther away for lunch. Plus the cafeteria food was good and it was good for morale. So, the company found it was acceptable for the cafeteria to take a loss in its operations for the good of the whole.

Sometimes this can be captured by a linear program, sometimes the interactions are more hidden and hard to quantify, but they are still there.

I will tell you in class of Russ Ackoff's "Best Possible Automobile".

In the example of a travel department optimizing costs – if a department head or top level manager has to spend 10 hours on layovers because a flight with 3 connections is cheaper, that means that department is basically paying him for 10 hours where he may be sitting around waiting in the cocktail lounge at the airport. So overall the agency can still be losing money; even though there may be some savings in the travel budget, the manager’s department could be taking a loss for paying him for lag time, also meaning more time away from the office and putting a burden on other staff.

As far as the ‘whole not equal to the sum of the parts’ question – in municipal government this can be true because there are numerous separate departments involved in the agency, each having their own priorities, possibly separate or not in agreement with the policy makers or legislative body (city councils, county commissioners, etc.). Even on a city council, members may have their own agendas or priorities. For example, a council person may say that their top priority is crime prevention, but in the police department their top priority may be to provide basic coverage due to being understaffed due to budget cuts.
Tammye

In th real world people need to think about, or at least be aware of the unpredictable. If everything was certain and had an exact cost, length of time, or output, then life would be very predictable and easy to plan for, but it is not.

One example of the "whole rarely even equal to the sum of its parts" is the process of writing a research paper for a class or work. Your boss or professor may ask you to do research on a particular subjet that requirs you to find and go through multiple sources. You may seach the Internet, read through periodicals, and thumb through books. In order to produce the final product, the paper, you may need to gather quite a bit of information before you can even begin to have enough knowledge on the subject to start. After you have read through all the collected materials you can begin to consolidate your ideas into your own paper. The final product, the finished paper, is a result of all the research, including the information you may not have used directly in your final paper.

BreAnna Kramer

One example of the "whole rarely even equal to the sum of its parts" is the process of writing a research paper for a class or work. Your boss or professor may ask you to do research on a particular subjet that requirs you to find and go through multiple sources. You may seach the Internet, read through periodicals, and thumb through books. In order to produce the final product, the paper, you may need to gather quite a bit of information before you can even begin to have enough knowledge on the subject to start. After you have read through all the collected materials you can begin to consolidate your ideas into your own paper. The final product, the finished paper, is a result of all the research, including the information you may not have used directly in your final paper.

BreAnna Kramer

I (as the professor) would hope that the final paper is MORE than the sum of the parts. If all you did was collect a bunch of bits of data from various places and throw them on the paper (yes, I had an undergrad student do that once in Economics) then the paper is indeed at best the sum of the parts. But, what I hope you do as a student (and what your boss would hope you do on the job) is add VALUE to the data, converting the data to knowledge, or even wisdom.

But this is an interesting thought. I was a writer of half time shows in college. The hours spent writing and rehearsing were quite extensive for the band, just for a 10 minute performance. But I suppose if you look at the person-hours involved - 10 minutes in front of several thousand people may be more person-hours than that time spent by the 100 person band practicing.

I think the most important thing we can do as managers, employees, or citizens, is model appropriate behavior. Doesn't ethical behavior come down to the Golden Rule: do unto others as you would have them do unto you ?
Anyway, I heard an ethicist state that; and, it makes sense to me. We take in information every day of our lives. We choose our attitudes and behaviors, and the knowledge that we want to share with others. Keep what makes sense to us in improving our environments (work and otherwise), and pass it on, if we think it will be helpful. But, essentially, the most important thing we can do is model the behavior that we would want imparted onto us: integrity, fairness, cooperation, etc. I think what frustrates me most is the incongruities that I see/experience from management officials who talk the talk, but do not walk the walk.
Anita Alston

Great discussion folks. I have been out of town on business travel, but I have caught up now and like your entries. The numbers can alswaya come out the way management wants them to if the true objective is that the sum equals all of the parts, however that mentality or style bull dozes the people for the sake of the numbers. When that happens, the intangibles kick in i.e.; morale, productivity, days off, not looking out for the best product or purchses for a company....the list goes on and on. The bottom line is that the numbers are one thing, but the human factors play a huge part in how good/bad the numbers are and what the data truly means for a decision.

The classmate submission on writing a paper was a good example, but I agree with Steve; with all of the data gathering the paper should be more than the sum because the writer can add to it their personal touch in putting the story together.

Maybe a bad is a good example. When they all show up and play well, they are great. Throw out a piece and have one or two of the members play while having the flu and you may have a different sound altogether.

Hi Steve,
I had replied to this a while ago, but don't see it in the gradebook. Can you double check? Thanks a bunch, I need all the points I can get!
Tammy

Better late than never.
Your question examines a department’s interaction to other internal bodies. Read this and see if you find analogs at a macro level. I can offer only opinion.

The trend of corporate America in the past decade is to outsource employment to off-shore facilities where labor is pennies on the dollar. For a single company, their costs are lower, and margin has increased. As more companies flock to achieve a greater margin, 3rd world countries enjoy more jobs, higher wages, and an increasing quality of living. At the same time, here in America, the reverse is true. This in turn causes the dollar to weaken, and other currencies to strengthen. The profit margin continues to increase due to a favorable exchange rate. Now the exchange rate moves in opposite directions, due to incredible earnings reports from the DOW index – Only this time, fewer people can afford the product, because their jobs were exported, and they now work at Wal-Mart. In a race to achieve the highest possible profit margin and net, the demand pool was drained. Now how much profit can be earned? What now is the median affect – Are all the “parts” summing to a favorable result?

“Business decisions”, at every level, are seldom designed for long term universal benefit.

I tried to explain this before, take a good look –You produce and sell milk. To lower your costs (in hope of increasing profit) you stop feeding the cows. This is corporate Americas mentality – Again, at every level.

Hi Steve,
I had replied to this a while ago, but don't see it in the gradebook. Can you double check? Thanks a bunch, I need all the points I can get!
Tammy
The gradebook is updated. Sorry for the delay.

Hi Steve,
I cannot find the grade book. I know I have been there before but darned if I can remember how I got there. Can you give me a clue?
THanks much.
Lori Beeler

Hi Steve,
I cannot find the grade book. I know I have been there before but darned if I can remember how I got there. Can you give me a clue?
THanks much.
Lori Beeler

It's under Tools. I have not posted the final course grades as a few people still remain to take the final. Hopefully they will complete tonight.