[Tech Talk] Without This Company, There Would Be No 'Baedal Minjok'

Core Technologies of Modern Society, Optimization
First Used by British Army in World War II
Commercialization Accelerated by US IBM Investment

Baedal Minjok, Coupang Rocket Delivery. Both handle orders from tens of millions of people nationwide every day. This massive logistics demand was unimaginable just a few decades ago.

IBM logo (left) and Baedal Minjok logo [Image source=IBM, Baedal Minjok]

How did just one or two companies manage to build such an enormous business? The secret lies in 'optimization.' Without IBM, which became the very foundation of modern optimization technology, services like e-commerce and delivery applications (apps) would have been nothing but a dream.

Increasing productivity just by changing workers' walking routes... the magic of 'optimization'

Coupang Logistics Center. Logistics management and route optimization in e-commerce are prime examples of optimization technology.
[Image source=Yonhap News]

Optimization is the core of modern society. Mass production, mass consumption, and mass transportation all operate through optimization technology. Thanks to optimization, Baemin can distribute the flood of food orders to delivery drivers nationwide. The entire process at Coupang's logistics centers is also part of optimization.

During the severe mask shortage amid COVID-19, Samsung Electronics employees helped small and medium-sized enterprises producing masks to more than double their production at once. How was this possible? It was the expertise of optimization engineers working at Samsung.

Samsung Electronics' optimization engineers supported the optimization of factory production lines for small and medium-sized enterprises during the COVID-19 pandemic, increasing production output.
[Image source=Samsung Electronics]

From order processing methods, human traffic routes, sensor operation timing, to conveyor belt arrangements, all tasks we perform have been made more efficient through optimization. Humans first achieved optimization during the Industrial Revolution by discovering 'division of labor,' and now they enhance yields using mathematics, computer science, and artificial intelligence (AI).

'Operational Research' born during World War II

The origin of modern optimization technology lies with the British military during World War II. They utilized mathematics and statistics to conserve ammunition and fuel and to streamline logistics.

Having realized the power of mathematics in enhancing warfighting capabilities, the British military subsequently pioneered a new military science field called "Operational Research." [Image source=Science Direct]

However, optimization became an academic field only very recently. In fact, it is a 'young science' less than 100 years old. Moreover, the birth of optimization is closely linked to war and technology.

During World War II, the British military was the first in the world to introduce scientific methodologies into military operations. They collected and statistically analyzed data to improve operational efficiency. These efforts culminated in the 1940s with the emergence of the concept called 'Operational Research (OR)'.

Scientist Patrick Blackett, who expanded operational research from the military domain to welfare sectors such as railroads, hospitals, administrative work, and public institutions.

Originally a physicist, he served in the British Navy during World War II and contributed to operational research.
[Image source=Internet Archive]

Originally, operational research was a military science aimed at optimizing ammunition and fuel consumption of military weapons and saving resources. However, after the war, scientists realized that OR could be applied to various public and private sectors such as government policy procurement, railway operations, and milk delivery. Especially, private companies highly valued OR's potential. Among them, IBM's investment was decisive.

IBM refines OR into 'optimization'

Today, OR is also known as 'operations science,' 'management science,' or 'econometrics.' Optimization is ultimately a derivative of OR. IBM, a leader in manufacturing large mainframe computers in the late 20th century, was also passionate about OR research. Many scholars in the OR field passed through IBM, enriching the academic discipline.

OR was optimized through IBM. IBM supported OR researchers at various universities after the war and played a key role in completing modern management science by leading the development of computers, which are essential for OR.
[Image source=IBM]

IBM's investment in OR was not in vain. When the popularity of mainframes declined and the era of small PCs began, IBM was hit hard, but the business area that saved IBM in crisis was also OR.

In fact, today IBM is closer to an OR consulting company than a tech company. Based on decades of accumulated expertise and technological achievements, IBM's business model mainly drives corporate revenue by consulting other government agencies and companies on management optimization and charging fees. IBM calls this consulting business 'service science.'

IBM's London Research Laboratory in the UK, used until the 1980s. The United States and the United Kingdom, considered the birthplace of modern management science, remain IBM's largest markets today.
[Image source=Glassdoor capture]

IBM's OR is deeply rooted in all areas of society. It is applied not only in general corporate management but also in architecture, sociology, economic policy research, law, and even stock investment. Nowadays, almost all large corporations have their own optimization teams, working day and night to improve operational efficiency even slightly.

Modern society runs thanks to optimization

We define the capitalist world since the mid-20th century as a 'mass consumption society.' Mass consumption presupposes economies of scale through mass production and freight cost reduction through logistics efficiency. Without OR, which optimizes the work of workers and machines behind visible factories and logistics centers every day, a mass consumption society could not exist.

Moreover, the importance of OR is growing. As delivery apps and e-commerce become widespread, transportation efficiency must increase significantly. It is no exaggeration to say that without companies like IBM laying the foundation of optimization, Baemin could not have been born.

OR has already become fully integrated into our daily lives. The method to determine the optimal number of passengers that can fit into a single passenger plane was also developed through OR.

Although invisible, it is highly likely that without the computerization and management innovations that occurred throughout the 20th century, services such as mass consumption, overseas travel, and e-commerce would not have existed.
[Image source=Yonhap News]