2016 INFORMS Annual Meeting Program

TB76

INFORMS Nashville – 2016

TB75 Legends C- Omni Behavioral Operations II Contributed Session

4 - Multi-recipe & Multi-variety Blast Furnace Production Planning Under Carbon Cap & Trade Policy Based In An Improved Block Molding Method Ye Yang, Southeast University, School of Economics and Management, Southeast, Nanjing, China, yangye1120@163.com, Wei-da Chen Carbon emission reduction policies have become key elements affecting production operations in the enterprises. Considering an iron making plant which outputs various products by multiple recipes, it studies multi-period blast furnace production planning problem with two types of carbon constraints (periodic carbon constraint, cumulative carbon constraint) under Carbon Cap and Trade policy. Firstly, based on an improved block molding method, two kinds of multi- recipe and multi-variety iron blast furnace production planning MILP models are constructed. Secondly, Cplex software is used for numerical analysis, discussing the effects of carbon cap and carbon price on production planning. TB74 Legends B- Omni Optimization Methodology II Contributed Session 1 - Global Optimum Of The Complementarity Constrained Program: Algorithm And Application Yu-Ching Lee, Assistant Professor, National Tsing Hua University, No. 101, Section 2, Kuang-Fu Road,, Engineering Building I,, Hsinchu, Taiwan, yclee@ie.nthu.edu.tw, En-Cheng Chang Chang The complementarity constrained program is found well applied in the area of inverse optimization, parameter selection, and hierarchical decision-making. The global optimality in these applications are important compared with other nonlinear programming problems. We discuss methodologies with some numerical experiments in this talk. 2 - Computational Study On Bilevel Mixed Integer Convex Programming Problems In this talk, we present a solution algorithm for bilevel mixed integer nonlinear (BiMINLP) programming problems through reformulation and decomposition. For the mixed integer convex lower level problem, we show that strong duality and KKT conditions of the continuous portion can be incorporated to achieve fast computation. Our solution procedure is evaluated on instances from literature as well as randomly generated ones, and a superior computational performance is observed. 3 - Sales Persons Compensation Scheme Considering Customer Satisfaction And Multiple Distribution Channels Chulok Ahn, PhD Candidate, Korea University Business School, Korea University Business School, Anam-ro, Seongbuk-gu, Seoul, 02841, Korea, Republic of, ahncokr@korea.ac.kr, Hosun Rhim, Kwangtae Park We examine the compensation strategy of a firm’s sales person in the multiple distribution channels with customer satisfaction considered. While customer’s satisfaction level differs to the distribution channel, the firm tries to find an optimal compensation scheme for both direct and retail channel. The firm sells same product with constant price but the incentive schemes differ on the basic salary, sales commission, and customer satisfaction. The mathematical model provides the optimal compensation schemes for both channels and can be applied to a company using multiple distribution channels. 4 - Optimization Based Decision Tree Construction Chaosheng Dong, University of Pittsburgh, 1025 Benedum Hall, 3700 O’Hara Street, Pittsburgh, PA, 15261, United States, chaosheng@pitt.edu, Bo Zeng We construct Decision Tree with an optimization-based approach. Liang Xu, University of Pittsburgh, 3700 O’Hara Street, 1048 Benedum Hall, Pittsburgh, PA, 15261, United States, lix21@pitt.edu, Bo Zeng

Chair: Arpit Goel, PhD Student, Stanford University, 475 Via Ortega, Huang Engineering Center, Stanford, CA, 94305, United States, argoel@stanford.edu 1 - The Behavioral Bayesian Newsvendor In Supply Chain Ju Myung Song, Rutgers Business School, PhD Program, Washington Park, Room 430C, Newark, NJ, 07102, United States, jumyungsong@gmail.com, Xiaowei Xu Behavioral Bayes’ rule using weighted updating model has been adopted in the literature on behavioral economics. In this paper, we study a single-period newsvendor problem with the supply chain coordination structure, and show how this behavioral bias leads to forecasting bias and affects the coordination and profit distribution. 2 - Impact Of Operational Failures On Worker Productivity: Evidence From An Agribusiness Setting Pradeep Pendem, PhD Candidate in OM, University of North Carolina, Chapel Hill, 300 Kenan Center Drive, Chapel Hill, NC, 27599, United States, pradeep_pendem@kenan-flagler.unc.edu, Bradley R Staats, Paul Green, Francesca Gino Failures in operational processes are ubiquitous in actual environments and play an important role in worker performance. Utilizing real time with-in shift data of harvest workers, we examine the impact of one class of operational failures, Breaks and Disruptions on their productivity. We find that productivity follows an inverted U-shaped response to breaks and negative effect to disruptions. In addition, we show that these effects are exacerbated by workload. Our findings suggest the need to give more emphasis on understanding the type of failure before taking any corrective action. Our study has important implications on the design of operating systems, scheduling policies more generally. 3 - Role Of Partnerships And Point Expiry On Customer Behavior In Reward Programs Arpit Goel, PhD Student, Stanford Univeristy, 475 Via Ortega, Huang Engineering Center, Stanford, CA, 94305, United States, argoel@stanford.edu, Ashish Goel, Vijay Kamble Customer behavior in loyalty programs is often attributed to irrational decision making. We provide and analyze an alternate model under which this behavior has a rational explanation. The key characteristics of our model are influence of business partnerships which increase the exogenous visits by the customer leading to higher switching costs with the reward program store and frequent expiry of earned reward points which create an urgency to make more frequent visits. We show that neither of these modeling assumptions provides a rational explanation on its own, but both together justify many observed customer behavioral aspects. TB76 Legends D- Omni Resource Allocation Contributed Session Chair: Lei Bu, Institute for Multimodal Transportation, Jackson, MS, United States, leibu04168@gmail.com 1 - Selecting Corporate Structure For Diversified Firms Arkadiy Sakhartov, Assistant Professor, The Wharton School, University of Pennsylvania, 2017 Steinberg Hall-Dietrich Hall, 3620 Locust Walk, Philadelphia, PA, 19104, United States, arkadiys@wharton.upenn.edu The study explores implications of corporate structure for performance of diversified firms. The benchmark for the scrutiny is the set of extant conflicting predictions about the optimal choice of two features of corporate structure, centralization of resource allocation and incentives to unit managers. The study considers relatedness between a firm’s businesses and uses the option valuation model to disentangle the existing conflicting predictions. The new results lay the groundwork for a better empirical identification of the effects of relatedness and corporate structure on corporate value, often tested in corporate diversification research.

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