OptTek Systems was launched in 1992 in a novel series of events. The simulation and consulting firm Decisioneering (which later became part of the software conglomerate, Oracle) was faced with the challenge of solving optimization problems from real world applications, where the goals and constraints were too complex to be expressed in classical mathematical programming formulations. A key element of many of these problems was the presence of uncertainty, which often arose in forecasting supplies, demands, costs, turnover, process outputs, environmental factors and other critical elements of various real world applications. Such elements could be usefully captured through simulation, but at the time this led to a dead end. A few academics and practitioners had noted the importance of solving optimization problems whose basic characteristics were expressed by simulating a real world system, but no practical methods or computer software for handling such problems existed.
In search of a solution, Decisioneering learned of three University of Colorado Professors who were pioneering the development of new methods for complex optimization models. Coming from backgrounds in mathematics, engineering and artificial intelligence, the three professors – Jim Kelly, Manuel Laguna and Fred Glover – had traced diverse career paths at the University of Maryland, the University of Texas and Carnegie Mellon University, before meeting and joining their research focus at the University of Colorado, where they became associated with the School of Business. Kelly, Laguna and Glover immediately saw the vital importance of the problem Decisioneering presented to them. If a method could be developed to optimize problems modeled by simulation, the door would be opened to an enormous range of real world applications previously considered inaccessible. Simulation was ideal for handling conditions in production, distribution, portfolio analysis, financial planning, energy systems, health care, workforce planning, environmental analysis, engineering design, power transmission and a host of other areas.
The researchers, profiting likewise from experience in industry and consulting, realized that this “simulation optimization” area was susceptible to being treated by innovations they had introduced in the field of metaheuristics – higher level methods for solving problems that could not be approached by traditional methods. Out of this came the optimization system OptQuest, featured as the first core software technology of the new company Optimization Technologies, Inc., inaugurated by Kelly, Laguna and Glover in 1992. Three years later the company name was shortened to OptTek Systems, Inc., though Optimization Technologies, Inc. remains the official company designation.
In the first years of its existence, OptTek Systems was chiefly a consulting firm and consisted just of its three original founders. The challenge was to make practitioners aware that simulation optimization was not merely a daydream of a few visionaries but a practical reality. Gradually this message began to register within the simulation world, and additional companies followed in Decisioneering’s footsteps by seeking to obtain optimizing systems to join with their own simulation software. These efforts were initially pursued in a disorganized series of initiatives on the part of simulation firms, some attempting to devise simulation optimization systems internally, and others attempting to enlist various outsiders with “name recognition” to create the necessary software. Inside a relatively brief span of time, however, OptQuest came to the fore as being significantly more effective than other software systems being devised, and in quick succession several of the leading simulation companies adopted OptQuest as the method of choice.
Spurred by this demand for their software, the OptTek founders expanded their operation in 2000 by opening their first office (on Seventh and Walnut Street in Boulder, Colorado), engaging a former executive VP of Business Development and CIO of EG&G subsidiaries, Jay April, who now serves as Chief Development Officer of OptTek Systems, and hiring two key software developers for producing commercial grade implementations, Terry Wubbena and Candy Brinkman, who continue to direct these operations today. During this same period, co-founder Jim Kelly left his post at the University of Colorado to devote full time to OptTek as the company CEO.
As OptQuest continued to go through repeated upgrades, and as additional simulation companies licensed OptQuest – which they then offered to their customers as an enhanced feature of their own systems – OptTek undertook to explore new ways to expand the range of its applications. The company successfully obtained Small Business Innovation Research (SBIR) grants from government groups which included the National Science Foundation, the Army Research Office and the Naval Personnel Research Office, to develop innovations to benefit specific market segments in industry and government. The gains achieved under these grants opened up another application area for the company in Workforce Planning, recently culminating in the creation of the OptForce software system.
In spite of being the leading supplier of optimization software to the simulation industry, and being the source of the landmark OptForce technology for Workforce Planning, OptTek Systems, Inc. remains a small and tightly knit organization, with twenty employees. Among its other initiatives, the company is engaged in projects for the U.S. Center for Disease Control and in Economic Development and Planning, and is currently exploring applications of its methods and software in the fields of energy and resource planning.