2016 INFORMS Annual Meeting Program

TC29

INFORMS Nashville – 2016

TC27 201A-MCC Empirical Studies in Supply Chain Management Sponsored: Manufacturing & Service Oper Mgmt Sponsored Session Chair: Jun Li, Ross School of Business, University of Michigan, Ann Arbor, MI, United States, junwli@umich.edu 1 - The Causes Of Drug Shortages: An Empirical Analysis Yixin (Iris) Wang, Ross School of Business, University of Michigan, Ann Arbor, MI, United States, iriswang@umich.edu, Jun Li, Ravi Anupindi The country has seen an increasing number of drug shortages starting from mid- 2000s, which led to rationing in treatment, delays in care, increasing medication errors and higher costs of care. This research tries to uncover the root causes of drug shortages and to quantify the size of each of their impacts. In particular, one of the objective is to understand what caused increasing quality problems? Is it due to manufacturing quality deterioration (and if so, why)? Or is it due to increasing FDA regulation stringency? To disentangle these possible causes, we conduct text analysis on FDA warning letters from 2000 to 2015. 2 - Ration Gaming And The Bullwhip Effect: A Structural Econometric Study Robert Bray, Kellogg School of Management, Northwestern University, r-bray@kellogg.northwestern.edu We develop a dynamic discrete choice estimator of (s, S) inventory models. We apply this estimator to a 5,320-SKU, 1,371-day sample from a Chinese supermarket to quantify the effect of ration gaming. 3 - Quality Propagation In The Supply Chain And Its Implication On Customer Future Purchasing Behavior: An Empirical Study Qiuping Yu, Kelley School of Business, Indiana University, 1309 E. Tenth Street, Bloomington, IN, 47405, United States, qiupyu@indiana.edu, Shawn Mankad, Masha Shunko We integrate transaction data from all stages of the supply chain including the manufacturers, distributors, restaurants and customers along with the customer survey and supply chain complaints data from a fast food restaurant chain to understand customer purchasing behavior. In particular, we focus on how customer satisfaction, supply chain quality, and promotions shape customer future purchasing decisions. TC28 201B-MCC Operations-Marketing Interface Sponsored: Manufacturing & Service Oper Mgmt Sponsored Session Chair: Xuanming Su, University of Pennsylvania, Philadelphia, PA, United States, xuanming@wharton.upenn.edu 1 - Online And Offline Information For Omnichannel Retailing Omnichannel consumers strategically make use of online and offline channels to gather information and purchase products. We study different omnichannel information strategies and their profit implications for firms. 2 - Leveraging Physical Presence In Omni-Channel Retail Antonio Moreno-Garcia, Kellogg School of Management, a-morenogarcia@kellogg.northwestern.edu, David Bell, Santiago Gallino With the growing relevance of online channels, retailers are exploring new ways in which they can overcome the impediments associated with selling products with non-digital attributes, such as apparel, without customers having physical access to products. By implementing a series of randomized field experiments, we study the value of virtual fit information in online retail. 3 - Signaling To The Crowd: Private Quality Information And Rewards-based Crowdfunding We consider the problem a seller designing a rewards-based crowdfunding campaign via a platform like Kickstarter. The seller solicits donations from contributors, and if total contributions exceed a pre-determined threshold the campaign is a success, the seller receives all donations and each contributor receives a reward; otherwise, contributors are refunded their donations and the campaign is a failure. When contributors know less than the seller, e.g. about the value of the reward or the likelihood of success, we determine how the seller should design its crowdfunding campaign. Robert Swinney, Associate Professor, Duke University, 100 Fuqua Drive, Durham, NC, 27516, United States, robert.swinney@duke.edu, Soudipta Chakraborty Fei Gao, University of Pennsylvania, Philadelphia, PA, United States, feigao@wharton.upenn.edu, Xuanming Su

4 - Donor Product-subsidies To Increase Consumption: Implications Of Consumer Awareness And Profit-maximizing Intermediaries Terry Taylor, University of California Berkeley, Berkeley, CA, 94720, United States, taylor@haas.berkeley.edu, Wenqiang Xiao Increasingly, donors that subsidize socially-desirable products (e.g., improved cook stoves, malaria drugs) in the developing world are shifting from distributing through non-commercial to commercial channels, ceding control of the product price to for-profit intermediaries. This paper advises a donor as to how the donor’s loss of price control and the level of consumer awareness—defined as the fraction of the consumer population that is informed of the product’s benefits—influence the donor’s optimal subsidy and utility. TC29 202A-MCC Issues in Environmental Operations: Managing Risk, Customer Returns, and Regulations Sponsored: Manufacturing & Service Oper Mgmt, Sustainable Operations Sponsored Session Chair: Gokce Esenduran, Ohio State University, Columbus, OH, United States, esenduran_1@fisher.osu.edu 1 - Risk Management Through Investment In Sustainability Ali Shantia, HEC Paris, Paris, France, ali.shantia@hec.edu, Sam Aflaki, Hamed Ghoddusi We study firms’ incentives to hedge input price risks through investment in energy efficiency (EE) solutions. In particular, we focus on how the convexity in profit function and the level and nature of uncertainties in the price of input commodities affect the decision of a single firm regarding the level of EE investment. We then characterize conditions under which investment in EE solutions substitutes or complements conventional financial hedging mechanisms. Finally, our analysis is further extended to a case with market power, where multiple firms make strategic decisions regarding optimal hedging and production. 2 - The Impact Of Consumer Returns On The Multichannel Sales Strategies Of Manufacturers Paolo Letizia, Assistant Professor of Business Analytics, University of Tennessee, Knoxville, TN, 37996, United States, pletizia@utk.edu, Terry P Harrison Manufacturers can provide consumers with a higher value when selling products through thei 3 - A Framework To Estimate The Economic And Environmental Impacts Of Take-back Legislation Eda Kemahlioglu-Ziya, North Carolina State University, Raleigh, NC, United States, ekemahl@ncsu.edu, Megan Jaunich, Hadi Gashti, Joseph F DeCarolis, Robert Handfield, Ranji S Ranjithan We develop a process model of returned product recycling under take-back legislation. We use data from this model to populate an optimization model and use it to estimate the cost and environmental impact of take-back legislation. Our research provides insights regarding how costs and environmental impact (measured in GHG emissions) of legislation change as implementation details such as covered products, minimum take-back requirements change. 4 - Valuable E-waste: Implications For Extended Producer Responsibility Atalay Atasu, Georgia Institute of Technology, atalay.atasu@scheller.gatech.edu, Gokce Esenduran, Luk N Van Wassenhove In a market regulated with take-back regulation, if recycling is profitable then producers have to compete with independent recyclers in collection and recovery of end-of-life (EoL) products. We answer the question of whether recovery targets lead to better environmental and economic outcomes in a competitive market for EoL products. We also compare two regulatory scenarios, where only producer collection counts and where both producer and recycler collection count towards meeting recovery targets. Our results show that counting recycler collection towards recovery targets does not always improve the welfare.

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