THE FIRM OF Touche, Niven, Bailey & Smart from its beginning
has been actively interested in searching out and developing
new ideas in the fields of auditing, tax, and management services.
Some of the ideas which have been pursued in management services
will be reviewed here.
Several years ago, Robert M. Trueblood of the
Pittsburgh Office began, in conjunction with Car-negie
Institute of Technology, a thorough and
comprehensive study of various applications of
statistical sampling to accounting and auditing.
Mr. Trueblood and his associates have written
many articles, including three in the Quarterly
Review, setting forth the results of their work.
A book on this subject will be published later
this year coauthored by Mr. Trueblood and
Richard M. Cyert of Carnegie Institute of Technology. A little
later the firm looked into the use of mathematical methods in
business problems generally. One of the most important initial
projects in this field was the application of the techniques of linear
programming to production scheduling and to the development of
long-range sales policy for the Nekoosa-Edwards Paper Company,
a Milwaukee client.
The firm's interest in continuously improving the level of its
services in all respects, and particularly its interest in the application
of scientific methods to assist in the determination of business
problems and as a tool in their solution, led to the formalization
of this type of activity through the establishment in 1955 of the
Management Sciences Research Department. The objectives of
this department are to carry out research in support of the activities
of the firm, especially management services, and to supplement the
knowledge already present in the firm's staff. This department is
attached to the Executive Office and is a service for the entire firm.
Since the department was organized, a long-range research
program has been established together with a permanent staff
having a thorough background in those fields pertinent to the
management sciences, such as applied mathematics, the physical
sciences, and operations research.