A stream of recent research considers the practice of random price discounts (a.k.a randomized pricing) when selling to forward-looking customers and shows that such pricing strategies can mitigate strategic customer waiting and boost seller profit. In practice, random price discounts are often offered together with price guarantees, in which customers are refunded the price difference if the price is lowered within a given time window after purchase. This paper investigates the efficacy of price guarantees under randomized pricing. To that end, we consider a model in which a firm adopts Markovian pricing and interacts with customers over an infinite time horizon. The following results are obtained. First, while Markovian pricing allows firms to price discriminate customers based on their monitoring costs, price guarantees further allow firms to price discriminate customers based on their willingness to pay. Second, offering price guarantees under Markovian pricing can help retain customers effectively by inducing high-valuation customers to purchase early, regardless of their arrival time. Third, even with price guarantees, Markovian pricing can dominate static pricing only when high-valuation customers are more likely to have a high monitoring cost, which illustrates that customer composition plays a crucial role in the effectiveness of the firm’s pricing strategy. Fourth, the optimal duration of price guarantees is closely related to customers’ lifetime duration. Finally, perhaps surprisingly, offering price guarantees can decrease the aggregate customer surplus since the firm offers sale prices less often under price guarantees.
The paper introduces a new multi-factor critical chain buffer estimation model and designs a dynamic monitoring method based on the project elements. A literature analysis determined a research gap and a research problem. It was found that the existing methods offer scarce collaborative studies on buffer setting and monitoring and insufficient research on buffer setting considering project economic indicators. However, these topics are often given priority consideration in practical engineering applications. Therefore, the study proposes a multi-factor critical chain buffer setting and its dynamic monitoring method. The planning stage analyses the impact of income, resources, and probability of success on buffer size setting and defines the calculation model of capacity constraint buffer. The execution stage dynamically sets buffer monitoring points according to the progress of project implementation, monitors the remaining buffer amount at the completion of each activity on the critical chain, and takes corresponding actions to ensure that the progress is controllable. The method was applied in a multi-project of a Chinese software enterprise. To further verify the effectiveness of this research, the method is compared with the traditional static buffer monitoring method (TBMM) and the relative buffer monitoring method (RBMM), and the construction period of the real project is simulated through the computer program for analysis. Results show that the research method can reduce unreasonable buffer settings, enhance the robustness of a buffer against complex environments, and reduce the probability of false warnings in the monitoring process.
Sheak Salman, Shah Murtoza Morshed, Md. Rezaul Karim
et al.
Purpose – The imperative to conserve resources and minimize operational expenses has spurred a notable increase in the adoption of lean manufacturing within the context of the circular economy across diverse industries in recent years. However, a notable gap exists in the research landscape, particularly concerning the implementation of lean practices within the pharmaceutical industry to enhance circular economy performance. Addressing this void, this study endeavors to identify and prioritize the pivotal drivers influencing lean manufacturing within the pharmaceutical sector. Findings – The outcome of this rigorous examination highlights that “Continuous Monitoring Process for Sustainable Lean Implementation,” “Management Involvement for Sustainable Implementation” and “Training and Education” emerge as the most consequential drivers. These factors are deemed crucial for augmenting circular economy performance, underscoring the significance of management engagement, training initiatives and a continuous monitoring process in fostering a closed-loop practice within the pharmaceutical industry. Research limitations/implications – The findings contribute valuable insights for decision-makers aiming to adopt lean practices within a circular economy framework. Specifically, by streamlining the process of developing a robust action plan tailored to the unique needs of the pharmaceutical sector, our study provides actionable guidance for enhancing overall sustainability in the manufacturing processes. Originality/value – This study represents one of the initial efforts to systematically identify and assess the drivers to LM implementation within the pharmaceutical industry, contributing to the emerging body of knowledge in this area.
Industrial engineering. Management engineering, Production management. Operations management
Amirhossein Moosavi, Onur Ozturk, Jonathan Patrick
We investigate an ambulatory care scheduling problem derived from a real case in Ontario, Canada that offers multi-appointment, multi-class, multi-priority treatments in geographically distributed campuses with multiple resources. We consider a dynamic setting with uncertain patient arrival and use of the emergency department. This problem is formulated as an infinite-horizon Markov decision process model. Since we cannot solve large-sized instances via conventional approaches, we hybridize this model with a neural network to simplify feasibility constraints while respecting all assumptions. Given the curse of dimensionality, we use an affine approximation architecture to estimate the value function. An equivalent linear programing model is solved through column generation in order to compute approximate optimal policies and derive two easy-to-implement scheduling policies. Simulation results demonstrate that the approximate optimal policy and heuristics outperform alternative scheduling policies. Finally, we demonstrate that the application of our methodology can enhance performance metrics in a large ambulatory care center in Canada. We show that a template-based scheduling rule can result in high resource utilization but poor scheduling decisions. However, an efficient scheduling policy equips a booking clerk with intelligent scheduling rules that are difficult for her to predict in real-time and work well in comparison to scheduling templates.
While mobility-as-a-service platforms have revolutionized urban transportation and fundamentally transformed travelers’ experience and engagement, they encounter a significant challenge in maintaining a temporal and spatial balance between supply and demand, particularly with the inclusion of crowd-sourced freelance drivers. In this study, we propose a hybrid supply-side management problem that accounts for heterogeneous revenue dependent on surge pricing, where surge pricing not only determines per-trip earnings but also influences demand elasticity and overall revenue generation. This problem combines the physical repositioning of in-house vehicles with an incentive-driven approach for freelance vehicles. A multinomial logit model is employed to model the repositioning behavior of crowd-sourced drivers, and reformulated as a low-level equilibrium problem embedded in a bi-level program. To characterize the surge price-dependent uncertain demand, a tailored residual-based Wasserstein ambiguity set is constructed. Notably, the proposed residual-based Wasserstein DRO model is demonstrated to satisfy both finite sample guarantee and asymptotic optimality. A linear decision rule approximation facilitates a tractable reformulation, and it is shown to incur no loss of optimality for the single-period case. We validate the practical applicability of our model using a dataset from RideAustin. We find that the hybrid fleet approach gets the best of both worlds by increasing average revenue using crowd-sourced vehicles and enhancing system robustness using in-house vehicles. Interestingly, we show that a “sweet-spot” may exist as an optimal ratio between the number of in-house and crowd-sourced vehicles that maximizes the overall revenue.
Aravinda Garimella, Anqi Wu, Ramanath Subramanyam
et al.
Crises are accompanied by resource shortages, operational challenges, and shifts in demand for resources. During crises, nonprofit organizations have historically played a crucial role in mitigating these challenges, with crowdfunding platforms emerging as a new solution for resource mobilization. In this study, we examine how individual and institutional donors respond to the sudden shifts in demand that accompany a global crisis. We analyze rich, granular data from multiple sources, including donation data from a leading education crowdfunding platform, before and after the onset of the COVID-19 pandemic, and find notable contrasts between individual and institutional responses. While there was a significant increase in institutional donations during the pandemic, individual donations remained relatively stable overall. Adopting a motivation-opportunity-ability (MOA) framework, we center donor heterogeneity in our approach, deriving nuanced insights. Donations from individuals in economically disadvantaged communities, which were the worst impacted by the crisis, decreased; however, these communities prioritized immediate and time-sensitive needs. Small and local institutions played a pivotal role in supporting high-need schools during the crisis. These findings make meaningful contributions to the operations literature on crowdfunding and have practical implications for platform designers. By distinguishing between individual and institutional donors and identifying the factors that drive their behavior, our study offers important implications for platform designers to improve crisis-time resource mobilization through more targeted engagement strategies.
Media plays a crucial role in shaping public perception of firms, significantly impacting their operations and performance. Firms often attempt to influence media channels to showcase their climate action initiatives, aiming to enhance their public image, reputation, and stakeholder trust. While firms cannot directly control their media coverage, intentional or unintentional dissemination of their climate action efforts can thrust them into the media spotlight. The implications of this media spotlight remain uncertain. While firms may anticipate positive public relations benefits from such exposure, it may also raise environmental expectations for firms and risk highlighting less favorable aspects of their environmental practices. Despite previous research on the impact of media exposure on firms’ financial outcomes, a notable gap exists in understanding how the media spotlight on firms’ climate actions affects their operational and financial performance. A clear hurdle is the lack of a systematic and objective measurement of such a spotlight. Our study addresses this research gap by developing a machine learning-based framework to derive a climate action vocabulary as a novel information artifact. The vocabulary is subsequently used to measure the intensity of media attention on a firm's climate actions. Our research reveals that an increased media spotlight on climate actions, regardless of their sentiment, has an adverse effect on firms’ financial performance, primarily due to the rise in operational costs. Furthermore, we find that the impact of media spotlight is heterogeneous. Low-polluting firms experience negative financial consequences as the downside of the heightened media spotlight. In contrast, high-polluting firms and those operating in polluting industries may witness an overall positive financial impact. We also find that firms’ market orientation (business-to-business vs. business-to-consumer), durability classification, index constituency (i.e., S&P 500), and greenwashing status significantly moderate the relationship. Our research highlights key considerations for corporate leaders with respect to the drawbacks for low-polluting firms in seeking media attention for their climate actions. Given that the media captures society's limited attention, our research suggests that firms should refrain from promoting superficial narratives about climate change that distract society from more impactful sustainability conversations.
This paper studies the impact of product sharing on competing manufacturers under a platform’s different quality entry barrier strategies. We build a game-theoretic analytical model to examine the strategies of two manufacturers: A high-quality manufacturer producing a high-quality product and a low-quality manufacturer producing a low-quality product. We explore three markets: The N-S market where the sharing market does not exist, the L-S market, and the H-S market, where the platform sets low and high entry barriers, respectively. We study these three markets because they bracket the most common platform entry policies in practice—no sharing, low-barrier (open access), and high-barrier (quality-gated) participation. Our findings indicate that while product sharing makes it easier for the high-quality manufacturer to survive, it may not necessarily improve the survival likelihood of the low-quality manufacturer. Furthermore, we demonstrate that the existence of the sharing market may negatively impact both manufacturers. To the best of our knowledge, this study is the first to investigate how competing manufacturers, platforms, and consumers can cope with the sharing phenomenon. We show that, while the high-quality manufacturer prefers a low cost of quality in all three markets, the low-quality manufacturer, interestingly, prefers a high cost of quality in both product-sharing markets. Additionally, we illustrate that the platform should not always set a low entry barrier to allow more product types to join. Surprisingly, our results show that although product sharing always benefits social welfare, it could potentially harm consumers.
Shiva Shekhar, Sarvesh Bandhu, Marshall Van Alstyne
Under what conditions should traditional firms transform into digital platforms? While adding developers can enhance value through externalizing value creation, it also entails investment risk. We show that when transformation entails high risk and the value of network effects is low, firms should avoid transforming into a platform and retain their traditional form. By contrast, low transformation risk or high value of network effects make digital transformation profitable. Interestingly, when firms choose to transform, we show that inviting rivals onto the platform can raise profits. Indeed, the platform can even pay rivals to join its platform in certain cases. We find that the benefit of enhancing network effects through demand aggregation can be more profitable than competing as separate platforms. Further, inviting rivals onto a proprietary platform lowers the rival’s competitive aggressiveness. This is a novel strategic rationale for inviting rivals onto the platform elicited in this article. Yet, when the value of network effects is very high and investments are nearly certain, the platform chooses to foreclose rivals’ participation. We offer guidelines for managers seeking to transform and for regulators seeking to intervene to boost market efficiency. We use real-world examples to illustrate our theory.
Diversity, equity, and inclusion (DEI) has been gaining attention in operations and supply chain management (OSCM) research but is often narrowly framed and dominated by instrumental logic. We offer three lenses that potentially broaden the scope of this scholarship: justice, paradox, and dialectical. The justice logic frames DEI as primarily a moral concern of inequality in firms and supply chains. It goes against an instrumental, performance-driven approach to establishing DEI in OSCM. To understand the persistence of tensions in DEI implementation, we present a paradox lens and link it to OSCM through four major types of organizational paradoxes: performing, organizing, learning, and belonging. We employ a dialectical perspective to resolve these tensions and combine instrumental and justice logics to explore how the latter can help firms realize DEI's (often unfulfilled) performance potential. OSCM scholars are well placed to use justice, paradox, and dialectical lenses to assess pathways for realizing DEI's transformative potential through modeling, decision support, and empirical research. Such research can help managers pursue objectives that conflict with or go beyond instrumental DEI, thus contributing to substantive DEI implementation.
The study aims to determine the implementation degree of Digital Era Governance (DEG) in selected local government units (LGU) of Małopolskie Voivodeship and to show differences in the effectiveness of digitalisation in LGUs depending on the level of local government, i.e., the county and the municipality. The study employs a model of digital maturity intended specifically for public administration. This model assesses six dimensions of digital maturity, namely, digitalisation-focused management, openness to stakeholders’ (partners’) needs, digital competencies of employees, digitalisation of processes, digital technologies, and e-innovativeness. The study results indicate that the examined local government units in the Małopolska region suffer from a low level of digital maturity. In particular, the results show that the implementation of digital technologies and the digital competencies of staff are the most developed dimensions of digitalisation in the examined local government units. In turn, e-innovation and process digitalisation are the least developed areas and require further improvement. Additionally, digital maturity is lower at the municipal than county level. These findings confirm the thesis that New Public Management affects the development of local government and highlights the increasing role played by Digital Era Governance. In contrast to most studies on public administrations, this study focuses on the local government level. It employs the original model of digital maturity in the field of public administration. This study intends to contribute to the concept of Digital Era Governance by focusing on the digitalisation of LGUs.
Javid Nayebi, Masoud Pourgholam-Amiji, Iman Hajirad
et al.
IntroductionThe lack of proper water productivity and the increase of water per capita over time have led to the drying up of rivers and lakes as well as the drop in the level of underground water. Currently, many countries are facing a great challenge in producing food from limited water resources. Lack of water along with improper exploitation of resources does not meet the growing demand of the current population for food. The lack of water resources for the production of various agricultural products, including wheat, is one of Iran’s main challenges and concerns and the primary solution is to improve and promote water productivity. In this regard, consuming less water should produce the most production. One of the biggest problems for wheat production is the lack of water resources and the fragmentation of different water management methods, fields, and irrigation systems. On the other hand, for water and farm management to have the greatest effect in increasing the yield, efficiency, and productivity of water consumption, it must have various inputs such as hybrid and modified seeds, chemical fertilizers and pesticides, the use of advanced tools and machinery, and appropriate planting operations, and harvesting should be done optimally, correctly, and at the right time-place. Materials and MethodsThe current study has targeted the main areas of wheat production in Iran. Due to its high nutritional value and strategic importance, wheat is cultivated in almost all areas of the country. According to the Pareto principle, the areas where 80% of wheat cultivation and production (irrigated and rainfed) are carried out are the main wheat production areas. Since in Iran, the statistics of the agricultural situation are mainly presented based on political divisions, therefore, the major regions will be the set of provinces in which the above hypothesis is true. Accordingly, 13 provinces of Golestan, Kermanshah, West Azarbaijan, East Azarbaijan, Hamedan, Ardabil, Lorestan, Central, Khuzestan, Fars, Razavi Khorasan, Kurdistan, and Zanjan have been identified as the main wheat production areas in Iran and in this study also, the main focus was on these areas. Since the vast country of Iran has a diverse climate, to ensure that all the country's climate groups are represented in the selected regions, an adaptation of these regions to the country's climate groups was also done. Results and DiscussionThe results showed that with the data of the 2020-2021 crop year, the reduction of agricultural water consumption by developing the method of irrigation the Raised Bed Planting Systems (RBPS) in the main areas of wheat production will lead to a reduction of 154.2 million m3 of water. The implementation cost of this solution based on the average implementation of each hectare is 50 million Rials in 2021, equal to 5059 billion Rials. Among the limitations in the stages of planting, planting, and harvesting wheat with the irrigation method of the raised bed planting systems, we can point out the need for cultivators equipped with furrows, but in the operation of planting, this method is facilitated. Regardless of the results of the research, limiting the movement of the wheels of agricultural machines to the furrows (traffic control), facilitating the operation, and the smoother movement of water in the furrows are some of the strengths of the raised bed planting systems. The advantages of this method can be mentioned as follows: increasing the yield of wheat per hectare, Improvement in soil ventilation and more growth of roots, Increasing the germination percentage of seeds and reducing seed consumption, reducing seed suffocation, reducing soil erosion, Reducing the amount of herbicides used, increasing the efficiency of using poisons and fertilizers, Reducing the risk of flooding and fungal diseases, and planting wheat on raised beds due to the elimination of irrigation borders as a combine-friendly method. ConclusionAs a result, using the new method of cultivation the raised bed planting systems can lead to the improvement of water productivity of wheat in the country as a management tool. The raised bed planting system is the most modern method implemented in developed countries. In this method, the seed is planted on long and wide beds, which increases the economic efficiency of the raised bed planting systems. It is expected that the yield of wheat fields will increase by 15% compared to the traditional method. In the cultivation system on raised beds, both the raised bed and the irrigation furrows are prepared at the same time. Also, fertilizer and seeds are distributed on the beds at the same time.
River, lake, and water-supply engineering (General), Engineering geology. Rock mechanics. Soil mechanics. Underground construction
Neste artigo busca-se avaliar o desempenho dos modelos de curva potencial e exponencial de aprendizagem de um grupo de soldadores, na soldagem de tubulações de aço carbono com o processo TIG. No estudo utilizou-se dois tipos de indicadores: produtividade média e produtividade ideal. A amostra agrupou os dados de produtividade, em faixas de diâmetros, de acordo com os graus de dificuldade estabelecidos pelo código ASME Seção IX. Realizou-se o ajuste dos dados aos modelos potencial e exponencial com o auxílio da ferramenta “Solver” do software Excel. Os resultados revelaram que o modelo exponencial é o que melhor representa o aprendizado. Os dados da produtividade média geraram ajustes de melhor qualidade em comparação com a produtividade ideal.
Production management. Operations management, Production capacity. Manufacturing capacity
The United States has long recognized the potential of improved energy efficiency to profitably reduce energy consumption in manufacturing. The Department of Energy (DOE) has also recognized the potential and initiated several programs to enhance energy efficiency in manufacturing. Despite the attention, studies point out that many energy‐efficiency opportunities remain unexploited. Increasingly, scholars have emphasized that behavioral factors could facilitate the uptake of energy‐efficiency practices. Accordingly, we adopt a behavioral perspective and investigate whether precision (a hitherto unexplored behavioral factor) affects the adoption of energy‐efficiency practices. Specifically, we examine whether the implementation of energy‐efficiency practices depends on whether the costs and savings associated with such practices are presented as precise (e.g., $20,431) or round (e.g., $20,400) numbers. First, we explore the impact of precision with econometric analysis using data on energy‐efficiency recommendations made by the DOE to small‐ and medium‐sized manufacturing firms. Our econometric analysis indicates that energy‐efficiency recommendations with precise cost and precise saving exhibit higher adoption rates as compared to other recommendations. Next, we use individual interactions with managers and laboratory experiments with managers and students to replicate and isolate the precision effects. Then, we elicit the mechanism by which precision affects the adoption of energy‐efficiency initiatives. We find that credibility serves as a key mechanism that drives the precision effect. Our findings suggest that credibility‐enhancing cues such as precision can be leveraged to increase the uptake of energy efficiency and possibly other process improvement practices.
Warfare afflicts millions and creates unparalleled operational challenges in the developing world. With data from war‐torn Colombia, I examine the effects of civil war on firms' total factor productivity (TFP) using propensity score and conflict hotspot models. I find that warfare increases TFP in service firms, such as public administration and defense, by up to 12.68%, whereas it decreases TFP in manufacturing and other nonservice companies by up to 3.64% a year after a violent episode occurs. This effect stems from intellectual capital growth and service firms' ability to create value from customer input.
The present study focuses on the Mediterranean Sea migration crisis and investigates the effectiveness of search and rescue (SAR) operations alongside measures to reduce the number of deaths of migrants at sea. It also describes the stakeholders involved in SAR activities. The paper first analyzes secondary data and the results of 24 in‐depth interviews in order to develop an analytical framework, which is then complemented by a system dynamics model to explore the complexity and interactions among stakeholders in SAR operations. The study shows that the death toll at sea can be reduced by enhancing cooperation among stakeholders by providing legal migration pathways under certain conditions and by engaging in more effective migrant detection and interception at sea. Lastly, raising potential migrants’ awareness about the risk of death during the sea crossing should be seen as an additional measure, while SAR activities should be maintained to prevent loss of life at sea.
This paper studies whether risky borrowing will induce a supplier to expand capacity and thus mitigate a capacity underinvestment problem in supply chains. It demonstrates that the relationship between capacity and capital structure is not as simple as the existing literature suggests. If the supplier is very powerful, it will use a mixed capital structure and build less capacity than if it were equity financed. If the buyer is very powerful, the supplier will use all debt financing and overbuild capacity. In this case, the supplier would not agree to build capacity ex ante if it were prohibited from borrowing. Hence, borrowing is Pareto optimal. Under a more balanced power structure, the supplier may choose all debt financing and overbuild capacity or all equity financing and underbuild capacity, depending on the trade‐off of the bargaining benefits and costs of debt financing.
Marzialia Micaela, Rossit Daniel Alejandro, Toncovicha Adrián
Supply chain activity control is an essential part of Supply Chain Management (SCM), ensuring compliance with customer requirements. This paper presents a case study into the control of SCM activities. The study analysed two areas involving two different SC links associated with order picking, and outsourced truck freights, respectively. The studied company had problems with these links. An approach based on developing a KPI (Key Performance Indicator) was proposed to address the issues. Consequently, different affected processes were analysed and characterised, considering the relevant data for defining a KPI. Then, strategies and methods were devised for data collection and processing regarding the system’s current state. Finally, tools were designed to facilitate the interpretation of the system’s current state and thus, pave the way for the decision-making process on corrective measures.