Incentive Systems and The Implementation of Management Science: A Spare Parts Application

The application of operations research models to solve a variety of management problems has enjoyed striking success over the past three decades. However, a disconcerting note has long been apparent to most practitioners. While the mathematical techniques of management scientists have been expanding rapidly, their influence on corporate decision-making has not kept pace.

This paper will illustrate an often overlooked reason for the lack of acceptance of operations research models using a case study application of inventory theory. The overlooked reason is that, quite often, the model and the manager have different (and possibly conflicting) goals. In such a situation, the model is likely to be either rejected or misused.