Quantitative Techniques: Theory and Problems

DISADVANTAGES OF TAKING A SIMULATION APPROACH

Disadvantages of taking a simulation approach to solve a management problem are indicated below:

1. Simulation is not precise. It is not an optimization process and does not yield an answer but merely provides a set of the system’s responses to different operating conditions. In many cases this lack of precision is difficult to measure.
2. A good simulation model may be very expensive. Often it takes years to develop a usuable corporate planning model.
3. Not all situations can be evaluated using simulation. Only situations involving uncertainty are candidates, and without a random component, all simulated experiments would produce the same answer.
4. Simulation generates a way of evaluating solutions but does ...