Behavioral operations management

Operations management involves a wide range of problem–solving skills aiming to help individuals or organizations to make more rational decisions as well as improving their efficiency.

[citation needed] In reality, this is not always true; human behavior has an important role in decision making and worker motivation, and therefore should be considered in the study of operations.

[7] This is a relatively new branch of psychology which focuses on humans' ability to make decisions, solve problems, learning, attention, memory and forgetting.

In addition to status, social psychology also includes people's behavior towards goal setting, feedback and controls, interdependence, and reciprocity.

Psychology experts often set up indicators to evaluate how an employee's surroundings, such as working environment and noise, can affect their productivity.

Organizational behavior theories are applied towards human resource trying to maximize the output from individual group members.

The study of organization behavior can be broken down into different sections, including personality, job satisfaction and reward management, leadership, authority, power and politics.

[15] The bullwhip effect happens along the supply chain as the result of information asymmetry between the organisations involved.

To avoid this happen in the future, the retailer does not only increase its next order to the wholesaler by the additional customer demand observed in this period, but by a little bit more just to be safe.

This fear of losing out in future sales is the behavioral component of the inventory problem causing the bullwhip effect.

The result of the bullwhip effect in this classic application is an excessive amount of stock held by retailers, wholesalers and manufacturer.

However, if the newspaper vendor stocks too little, he misses the opportunity to make more profit and suffers loss of goodwill.

All agents are expected or aimed to be allocated in a way that will maximize productivity and efficiency and minimize the total cost of the assignment.