The Optimization Edge: Reinventing Decision Making to Maximize All Your Company's Assets

March 17, 2011 - PRLog -- Princeton, NJ.  March 2011.  How have Google, Marriott, McDonald’s, UPS, and other industry leaders outperformed all their competitors, leaving even their closest rivals far behind?

Steve Sashihara’s new book goes behind the scenes, revealing that the success of these companies, along with other powerhouses such as Amazon and Walmart, hinges on their ability to use Optimization to make strategic and day-to-day operational decisions.  

“Optimization is about harnessing the new breed of software that makes explicit recommendations about achieving business goals,” explains Sashihara, president of Princeton Consultants, Inc. He adds, “The Optimization Edge relates the experiences of a forward-thinking breed of executives who have distanced their companies from competitors by deploying Optimization to make decisions faster, better, and more consistently than those making decisions the old-fashioned way.”

Example: One of the toughest decisions that McDonald’s had to make in Japan, with 3,000 restaurants that have 300 distinct layouts and configurations, was when and how to invest in upgrades. Enter Mike Cramer, director of McDonald’s Operations Research Department, and his team of optimizers. They began with a month-long field study of restaurant traffic flows, order patterns, service levels, and employee behavior. Back at McDonald’s research center in the United States, the findings were used to build two functioning restaurants in which the impact of various upgrades was tested. The resulting data were incorporated into a custom¬ized software program capable of simulating the impact of different combinations of upgrades on service levels, employee stress, financial performance, and expansion potential. The software recommended the optimal upgrades for each of the 300 configurations, as well as the best order in which to make them.

The results? The new way of making upgrade-investment decisions added an additional $100 million in revenues in the first year. Eight of the twelve res¬taurant segments that made the investments increased traffic by 10 per¬cent—the precise level projected by Cramer’s software. The remaining four have experienced even greater increases.

At a time when cutback management prevails, Sashihara’s book uses numerous examples drawn from across industries—from music to health care—and within different functions—from Sales to Human Resources—to demonstrate that by using Optimization companies can drive up the value of their assets for both short- and long-term growth. Beyond the bottom line, Optimization helps to change organizational culture from defensiveness to forward-looking confidence, as decision makers search for what is best.  

Despite its track record of success, Optimization is a woefully underutilized management tool.  “It has been a too-well-kept secret,” says Sashihara, “which is one reason I wrote The Optimization Edge.” As he puts it, “I wanted to put into the hands of every executive, in language they could understand, a framework to think about Optimization, explore the implications for decision making, and provide a road map for using it to drive up the value of key assets.”

About the Author
Steve Sashihara is the CEO of Princeton Consultants, Inc. (www.princeton.com), which specializes in a unique blend of information technology and management consulting.
Steve leads his firm's Optimization practice: transforming businesses by designing and installing software that makes tangible recommendations for action. Princeton Consultants has distinguished itself as a leader in this field, with its optimization software managing the real-time scheduling of the global NetJets fleet, the layout of The Wall Street Journal, and trading for high-frequency hedge funds.

The Optimization Edge: Reinventing Decision Making to Maximize All Your Company's Assets (www.optimizationedge.com) is the first book to introduce and explain Optimization to business executives, without the use of jargon or complicated mathematics.


The Optimization Edge: Reinventing Decision Making to Maximize All Your Company’s Assets—Steve Sashihara—Published by McGraw-Hill
   978-0-07-174657-1—274 pages—$35.00—February 2011


Contact: Peter M. Tobia, Market Access
215 402 0731; ptobia@mktaccess.net

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Market Access is a marketing and public relations firm and literary agency based outside Philadelphia, PA. Its clients include consulting and other professional services firms. Its president and founder is Peter M. Tobia, Ph.D. (ptobia@mktaccess.net)