2015 Informs Annual Meeting

MB52

INFORMS Philadelphia – 2015

MB51 51-Room 106B, CC Behavior-driven Operations Management Sponsor: Manufacturing & Service Operations Management Sponsored Session Chair: Fuqiang Zhang, Olin Business School, Washington University, St. Ali Parlakturk, Associate Professor, UNC Kenan-Flagler Business School, 300 Kenan Center Drive, MC #4708, Chapel Hill, NC, 27599, United States of America, Ali_Parlakturk@kenan- flagler.unc.edu, Yen-Ting Lin, Jayashankar Swaminathan We contrast the results of forward-looking strategic customers with the myopic customers benchmark in a supply chain of a manufacturer and a retailer. The combination of Strategic customer behavior and decentralization does not necessarily result in the worst supply chain performance. In fact, when customers are sufficiently patient, a decentralized supply chain that faces strategic customers outperforms the supply chain with only one of those factors at play. 2 - Managing Social Responsibility in Multi-tier Supply Chains Robert Swinney, Associate Professor, Duke University, 100 Fuqua Dr, Durham, NC, 27708, United States of America, robert.swinney@duke.edu, Lu Huang, Jeannette Song We examine a three level supply chain in which a Tier 2 supplier sells to a Tier 1 supplier which sells to a downstream (Tier 0) firm, and consider whether Tier 0 should manage social responsibility in Tier 2 directly or delegate to Tier 1. We focus on the impact of external stakeholder behavior (consumers, NGOs, and governments) on the Tier 0 firm’s optimal strategy, and show that increasing pressure from these stakeholders may backfire and lead to a less responsible supply chain. 3 - A Model of Rational Retrials in Queues Shiliang Cui, Georgetown University, McDonough School of Business, Washington, DC, 20057, United States of America, shiliang.cui@georgetown.edu, Senthil Veeraraghavan, Xuanming Su Consumers suffer dis-utility in waiting for a service. When they can self-organize the timing of their service visits, they may avoid long queues and choose to retry later. We study an observable queue in which consumers make rational join, balk and costly “retry” decisions upon their arrival. Retrial attempts could be costly due to factors such as transportation costs, retrial hassle and visit fees. We characterize the equilibrium under such retrial behavior, and study its welfare effects. 4 - Ceo Overconfidence, Inventory Management, and Firm Performance Fuqiang Zhang, Olin Business School, Washington University, St. Louis, MO, United States of America, fzhang22@wustl.edu, Tianjun Feng, Qing Zhang Using the data of U.S. manufacturing firms during 1999-2011, we investigate the relationship between CEO overconfidence and firm inventory management. We find that firms with overconfident CEOs have lower inventory levels. In addition, we provide empirical evidence of the mediation effect of inventory level on firm financial performance. MB52 52-Room 107A, CC Best Paper Award Sponsor: Service Science Sponsored Session Chair: Tor W. Andreassen, Professor, NHH Norwegian School of Economics, Helleveien 30, Bergen, Norway, tor.w.andreassen@nhh.no 1 - Design of Informatics-based Services in Manufacturing Industries: Case Studies and Discussion Chie-Hyeon Lim, Post-doc, POSTECH, Engineering Building #4-316, Pohang, 790-784, Korea, Republic of, arachon@postech.ac.kr, Jun-yeon Heo, Min-Jun Kim, Kwang-jae Kim A key component of servitization in manufacturing industries is informatics, which transforms product and customer data into information for customers. Informatics-based service is defined as a type of service wherein informatics is crucial to customer value creation. In this talk, we introduce two case studies on the design of informatics-based services in manufacturing industries. Various aspects of informatics-based service design in manufacturing are also discussed. Louis, MO, United States of America, fzhang22@wustl.edu 1 - Are Strategic Customers Bad for a Supply Chain?

4 - Online Reuse Marketplaces: An Empirical Analysis Suvrat Dhanorkar, Assistant Professor, Penn State University, University Park, State College, PA, United States of America, dhanorkarsuvrat@gmail.com Online Reuse Marketplaces promote matching between producers and consumers of used products. We examine questions related to the evolution and design of one such marketplace.

MB50 50-Room 106A, CC

Supply Chain Risk Management Strategies Sponsor: Manufacturing & Service Operations Management Sponsored Session Chair: Yiming Wang, Arizona State University, Department of Supply Chain Management, Tempe, AZ, 85287, United States of America, yimin_wang@asu.edu 1 - Payment Timing in Multiechelon Supply Chains: Cost Assessment, Incentives, and Coordination Greg Decroix, Professor, University of Wisconsin-Madison, 975 University Avenue, Madison, WI, 53706, United States of America, gdecroix@bus.wisc.edu, Jeannette Song, Jordan Tong Developments in information technology have led to increased variety in payment arrangements between supply chain members. In this paper we introduce a new system for capturing the financing costs resulting from a general class of such payment schemes. Under wholesale price contracts, we use this framework to demonstrate the impact of payment timing on firm incentives, and show that partially delayed payments can achieve coordination in settings where standard or fully delayed payments cannot. 2 - Global Sourcing under Yield Uncertainty Shahryar Gheibi, Doctoral Candidate, Syracuse University, 721 University Ave., Syracuse, NY, 13244, United States of America, sgheibi@syr.edu, Burak Kazaz, Scott Webster We study the sourcing policies of a firm operating in an agricultural environment where yield uncertainty influences the firm’s crop supply. Our analysis examines the direct trade sourcing policy which is perceived as an alternative to the fair trade policy. It is often believed that hedging is not advantageous in risk-neutral settings; our work, however, shows that there are conditions when the firm benefits from utilizing futures contracts simultaneously with direct trade sourcing policies. 3 - Wine Analytics: Fine Wine Pricing and Selection under Weather and Market Uncertainty Mert Hakan Hekimoglu, Doctoral Candidate, Syracuse University, 721 University Avenue, Syracuse, NY, 13244, United States of America, mhekimog@syr.edu, Burak Kazaz, Scott Webster We investigate a distributor’s portfolio selection problem of wine futures and bottled wine. Using Liv-ex.com data, we first empirically show how the evolution of futures prices for young wines can be predicted by changes in weather and market conditions. We then examine the distributor’s investment decisions in wine futures, bottled wine, and cash position analytically using a Value-at-Risk measure. 4 - Production Decisions for New Products under Yield and Demand Learning Candace Yano, University of California, Berkeley, IEOR Dept.and Haas School of Business, Berkeley, CA, 94720, United States of America, yano@haas.berkeley.edu, Kai-chuan Yang Manufacturers launching new products can schedule the first production run well before product introduction, allowing them to learn about the uncertain yield. But early production would occur before an accurate demand forecast is available, thus risking overproduction. We explore how a firm facing capacity constraints should optimize these decisions when new products share capacity with existing products whose demands are uncertain but whose yields are more predictable.

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