Sensitivity Analysis In Operations Research Decisions: A Case Study On A Mathematical Model

Abstract

This study explores sensitivity analysis within the realm of decision-making in Operations Research, focusing on integrated mathematical models. The investigation centers on a critical variable—supplier lead time—using a case study to comprehend its impact on both operational efficiency and the overall costs of a manufacturing company. To optimize inventory levels, production costs, and total operational costs, an integrated mathematical model is devised, taking into account variations in supplier lead times. Sensitivity experiments are performed by manipulating supplier lead times, and the ensuing outcomes are scrutinized to offer comprehensive insights. The findings reveal that substantial alterations in supplier lead time can significantly affect operational performance and strategic decision-making. In response to lead time changes, adaptive strategies, such as implementing tighter contracts and exploring alternative suppliers, are suggested. This research enhances our understanding of how sensitivity analysis serves as a valuable tool for enhancing operational resilience and making informed decisions amidst uncertainties in supply chains.