Implementation of Management Science in Latin America: A Case Study and Generalization

Private and public programs designed for rapid industrialization and for raising living standards have caused a growing demand in Latin America for persons trained in management science. Current sources for such training include special "productivity centers," departments or institutes of management science at various Latin American universities, technical personnel of North American firms, and professional academicians of North American educational institutions. If the level of private business between North and South America increases, it would be quite reasonable for North American firms to assume a greater responsibility for the transfer of management science techniques to Latin America. This paper describes an actual case study of the application of management science to the business and operational problems of a Latin American meat processing firm. Located in Paraguay, the firm is a subsidiary of a large multi-management company--Ogden Corporation. In conjunction with the local management, the study was conducted by Ogden's department of Operations Research. The following aspects of the Latin American firm were analyzed for possible application of management science techniques: (1) organization structure, (2) ranch operations, (3) product mix problems, (4) investment analysis, and (5) inventory control. Based on Ogden's experiences in a typical Latin American business setting, we attempt here to describe some of the present problems and the future potential for management science applications in Latin America. Major problems of implementation identified in this case and considered typical to Latin America are: (1) lack of qualified personnel, (2) lack of EDP facilities, and (3) existence of traditional cultural and political barriers to scientific approaches. However, because of a rising technological function, management science application offers a fertile territory in Latin America.