2016 INFORMS Annual Meeting Program

SB37

INFORMS Nashville – 2016

SB36 205B-MCC Incentives and Risk in Supply Chains Sponsored: Manufacturing & Service Oper Mgmt, Supply Chain Sponsored Session Chair: Karan Girotra, INSEAD, Fontainebleau, France, karan.girotra@insead.edu Co-Chair: Simone Marinesi, Wharton, Philadelphia, PA, United States, marinesi@wharton.upenn.edu 1 - Fleet Management For Healthcare Delivery In Africa: Vehicle Ownership And Contracting Models Sang-Hyun Kim, Associate Professor, Yale University, New Haven, CT, United States, sang.kim@yale.edu, Li Chen, Hau Leung Lee In this paper we study an innovative healthcare product delivery system that Riders for Health, a nonprofit organization based in UK, has implemented in a number of African nations. Health products are delivered to rural areas via motorcycles in difficult transportation conditions, and therefore it is critical to run an effective vehicle maintenance program. Riders for Health experimented with different contractual agreements with government agencies. We build a model based on reliability theory and contract theory that captures the essence of the problem that Riders faced, and discuss managerial insights that the model predicts. 2 - Learning (or Not) From Precursors To Disasters Heikki Peura, Imperial College, London, United Kingdom, hpeura@london.edu, Nitin Bakshi Disasters are invariably preceded by more frequent precursor events. These events embed valuable information about the likelihood of the root cause of a disaster, and thereby facilitate risk assessment. But to learn from precursors, a managing firm typically relies on the reports of a contractor, who is often also responsible for mitigating the occurrence of these incidents. We show how firms may fail to learn from precursor events due to the resulting intertwined problems of moral hazard (on risk mitigation) and hidden information (on reporting precursors). 3 - Supply Disruptions And Optimal Network Structures Kostas Bimpikis, Stanford, kostasb@stanford.edu, Ozan Candogan, Shayan Ehsani We study multi-tier supply chain networks in the presence of disruption risk. Firms compete in one of K production stages and prices of intermediate goods are set so that markets clear. We characterize equilibrium prices, profits, and sourcing decisions and explore how they are affected by the network structure. Also, we identify the network structures that maximize aggregate profits, welfare, and consumer surplus. Interestingly, these networks can be ranked in terms of how “balanced” the supply chain is. Finally, we consider endogenous chain formation and argue that it leads to inefficiencies both in terms of the number of firms that enter and in terms of the structure of the resulting networks. SB37 205C-MCC Supply Chain Topics Sponsored: Manufacturing & Service Oper Mgmt, Supply Chain Sponsored Session Chair: Robert Bray, Kellogg School of Management, 830 Hinman Ave. Apt. 2S, Evanston, IL, 60202, United States, robertlbray@gmail.com 1 - Buyer Intermediation In Supplier Finance Tunay Tunca, Professor, Unversity of Maryland, College Park, MD, 20910, United States, ttunca@rhsmith.umd.edu, Weiming Zhu We analyze the role and the efficiency of buyer intermediation in supplier financing (BIF). We theoretically demonstrate that BIF can significantly improve the supply chain surplus over traditional financing. Using data from a large Chinese online retailer, we estimate model parameters, empirically verify the theory, and predict efficiency gains. 2 - Shock Spillover And Financial Response In Supply Chain Networks: Evidence From Firm-Level Data Andrew Wu, Assistant Professor of Tech, Operations, Finance, Ross School of Business, University of Michigan, Ann Arbor, MI, United States, andydiwu@umich.edu, Jun Li Using machine learning methods on firm-level textual disclosures, this research studies the propagation of firm-specific production shocks through supply chain relationships, and the stock market reactions to such propagated shocks.

4 - Being On The Productivity Frontier: Identifying “Triple Aim Performance” Hospitals Sriram Venkataraman, University of South Carolina, sriram.venkataraman@moore.sc.edu Aleda Roth, Anita L Tucker, Jon A Chilingerian Hospital decision makers may face tradeoffs that make it difficult to achieve relatively high performance simultaneously on cost, clinical quality and patient experience. We empirically examine the association between having high performance on any of the three criteria on the probability of being a U.S. News & World Report honor roll hospital. Surprisingly, we find a significant negative relationship exits between being an honor roll hospital and achieving high performance outcomes on any of the three TAP criteria. Furthermore, we find that the percent of physicians employed by the hospital has a positive and significant effect on being a TAP hospital. SB35 205A-MCC Behavioral Models in Service Operations Sponsored: Manufacturing & Service Oper Mgmt, Service Operations Sponsored Session Chair: Guillaume Roels, UCLA, Anderson School of Management, Los Angeles, CA, 90095, United States, groels@anderson.ucla.edu 1 - Pricing With Consumer Optimism And Quality Perception: From Experiment To Theory Rim Hariss, Massachusetts Institute of Technology, 254Windsor Street, Apt 2L, Cambridge, MA, 02139, United States, rhariss@mit.edu, Georgia Perakis, Wichinpong Sinchaisri, Yanchong Zheng We study how consumers’ optimism about future markdowns and their quality perceptions influence a firm’s optimal markdown pricing strategy. We experimentally elicit the relationship between consumers’ perceived quality of a product and the product’s price information (e.g., initial price, discount, final selling price). We estimate a functional relationship from the data and incorporate this relationship into consumers’ purchase behavior. We then characterize the firm’s optimal policy given that consumers form price-based quality perceptions and may hold inaccurate expectation of the level of future markdown. 2 - Impact Of Server Behavior On The Performance Of Queueing Systems Masha Shunko, University of Washington, mshunko@gmail.com Multi-server single-queue (SQ) systems may outperform multi-server parallel- queue (PQ) systems due to the pooling effect. We model and analyze the impact of human server behaviors (namely, slowdown due to free riding and workload- dependent service rate) on the performance of SQ and PQ systems and derive how large the behavioral impacts should be to outweigh the benefits of pooling. 3 - Pooling Queues With Work Averse Servers Guillaume Roels, UCLA, groels@anderson.ucla.edu, Mor Armony, Hummy Song Contrary to the classical theory of operations management, recent case studies in retail, call centers, and healthcare indicate that pooling queues may not necessarily result in less expected work in process. In this paper, we propose that this phenomenon may arise when servers are work averse and have some discretion over their choice of service capacity. We distinguish two types of work aversion, namely workload aversion and busyness aversion, and show that dedicated configurations yield less expected work in process than pooled configurations when servers exhibit high degrees of workload aversion or low degrees of busyness aversion.

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