Informs Annual Meeting 2017

MC04

INFORMS Houston – 2017

MC03B Grand Ballroom B Static and Dynamic Optimization in Revenue Management Sponsored: Revenue Management & Pricing Sponsored Session Chair: Huseyin Topaloglu, Cornell University, Ithaca, NY, 14853, United States, topaloglu@orie.cornell.edu 1 - Dynamic Resource Allocation with Reusable Resources and Customer Choice Mika Sumida, Cornell University, Ithaca, NY, 14850, United States, ms3268@cornell.edu, Paat Rusmevichientong, Huseyin Topaloglu We consider a resource allocation model with reusable resources. Customers arrive in an online fashion and are offered an assortment of products. When a customer selects a product, it becomes unavailable for a fixed service time. After the service time, the resource is returned to the system for reallocation. The goal is to pick assortments that maximize the total expected revenue. This problem has a number of applications in the hotel and rental car industries, cloud computing, and the sharing economy. We present a computationally efficient policy with provable performance guarantees. 2 - Single-leg Revenue Management with Fare-locking Huseyin Topaloglu, Cornell University, 223 Rhodes Hall, Ithaca, NY, 14853, United States, topaloglu@orie.cornell.edu, Mika Sumida We study a revenue management model over a single flight leg, where the customers are allowed to lock an available fare. Each customer arrives into the system to purchase a ticket for a particular fare class. If this fare class is available, the customer either immediately purchases the ticket by paying the fare or locks the fare by paying a fee. If the customer locks the fare, then the airline reserves the capacity for the customer for a certain duration of time. At the end of this duration of time, the customer makes her ultimate purchase decision. We give a 2-approximation algorithm. 3 - Dynamic Assortment Optimization with Inventory Cost Venus Lo, Cornell University, 206 Rhodes Hall, Ithaca, NY, 14853, United States, vhl8@cornell.edu, Huseyin Topaloglu We consider a dynamic assortment optimization problem of selecting an assortment of products and their inventory level to offer to a stream of customers. Unlike traditional revenue management problem where the seller controls the products available to each arriving customer, the seller only makes initial inventory decisions. There is a cost of stocking the inventory, with no salvage value. The assortment available to each customer depends on the initial stock and the purchases of preceding customers, who are willing to substitute. We present a dynamic program for deterministic customer arrivals with nested preferences and develop related heuristics for the case of stochastic customer arrivals. 4 - Pricing Discounts in an Electric Vehicle Share System Bobby Nyotta, UCLA Anderson School of Management, Los Angeles, CA, United States, bobby.nyotta.1@anderson.ucla.edu, Fernanda Bravo, Jacob Feldman We study the use of pricing discounts in an electric vehicle share-system with free-floating parking. Specifically, we examine the optimal policy for the operator to offer free rides to the charging stations. Free rides can help to keep vehicles charged and to rebalance the system, however a revenue loss is experienced. Based on the optimal policy structure, we decompose and approximate the problem with an algorithm that performs well on real problem instances. MC03C Grand Ballroom C Empirical Studies with a Behavioral Element Sponsored: Manufacturing & Service Oper Mgmt Sponsored Session Chair: Robert Batt, Wisconsin School of Business, UW-Madison, Wisconsin School of Business, UW-Madison, Madison, WI, 53706, United States, rbatt@bus.wisc.edu 1 - Managing Capacity in an Outbound Contact Center with Crowdsourced Servers Marcelo Olivares, Universidad de Chile, Beaucheff 851, Santiago, Chile, molivares@u.uchile.cl, Andres I.Musalem Customer contact centers are increasingly using crowd-sourcing strategies to hire agents that provide service remotely, providing more flexibility and lower the cost of operating at low utilization levels. Lower system utilization reduces customer waiting times but can also affect productivity and churn of the agents. In this work we conduct an empirical study to measure time-sensitivity of customers and agent’s behavior in this type of service system, using data from an outbound call

center. We show how the empirical results can be used to conduct a cost-benefit analysis to plan service capacity. 2 - Manager Incentives, Outcomes, and Operational Decisions Saravanan Kesavan, University of North Carolina-Chapel Hill, Kenan-Flagler Business School, Cb 3490 McColl Building, Chapel Hill, NC, 27599-3490, United States, skesavan@unc.edu As customers increasingly shopping through their desktops, laptops and mobile devices, retailers across the industry are looking to ramp up their investments in omnichannel retailing to offer them a seamless shopping experience. These new workflows can create serious challenges to store management. So, retailers are figuring out ways to restructure the compensation plan for store managers to enhance cooperation. In this study, we explore data from a retailer that changed it compensation plan to emphasize greater coordination among store managers. 3 - Oversight and Efficiency in Public Projects: A Regression Discontinuity Analysis Ruomeng Cui, Goizueta Business School, Emory University, Atlanta, GA, United States, ruomeng.cui@gmail.com, Eduard Calvo, Juan Serpa During the execution of a public project, should regulators continually scrutinize the contractor’s operations? In this paper we explore the causal impact of government oversight on a project’s delay time and cost overrun. We glean a detailed procurement database of public projects spanning 173 U.S. federal agencies. We exploit a regulatory bylaw in federal procurement: if a project’s budget exceeds a cutoff, the project’s operations are surveilled. Using a regression discontinuity design, we find that decreasing the intensity of oversight significantly decreases a project’s delay time and cost overrun. Further, the result Robert Batt, Wisconsin School of Business, UW-Madison, 5279 Grainger Hall, 975 University Ave., Madison, WI, 53706, United States, rbatt@bus.wisc.edu, Santiago Gallino We study “chaotic storage” order-fulfillment systems in which dissimilar items are stored together in a single location. This necessitates a searching task as part of the item picking process. We show that pick times increase by as much as 16% as the searching task becomes more difficult. However, the deleterious effect of searching decreases with pick worker experience. Using simulation, we show that pick times can be improved by approximately 5% by incorporating distance, complexity, and picker experience into pick assignments and pick routing. 320A Selected Topics in Sustainable Operations Sponsored: Manufacturing & Service Oper Mgmt, Sustainable Operations Sponsored Session Chair: Li Chen, Cornell University, Ithaca, NY, 14853, United States, li.chen@cornell.edu Co-Chair: Shiqing Yao, The Chinese University of Hong Kong, Room 938 9/F, Cheng Yu Tung Building No.12 Chak Cheung Street, Shatin, N.T., Hong Kong, Hong Kong, yaoshiqing@gmail.com 1 - Testing by Competitors in Enforcement of Product Standards Erica Plambeck, Stanford University, Graduate School of Business, 518 Memorial Way, Stanford, CA, 94305-5015, United States, elp@stanford.edu This paper explores a potentially efficient mechanism to encourage compliance with and identify violations of safety and environmental standards: Firms testing competitors’ products. 2 - Cooperative Approaches to Managing Social Responsibility in Supply Chains Xin Fang, Singapore Management University, 50 Stamford Road, #05-01, Singapore, 178899, Singapore, xfang2015@gmail.com, Soo-Haeng Cho This paper investigates two cooperative approaches of firms’ managing social responsibility violations of suppliers: auditing a common supplier jointly or sharing independent audit results with other firms. We develop a model based on a cooperative game in partition function form, and show that: (1) competing firms have incentives to cooperate when the negative externality of one firm’s social responsibility violation on other firms is high; and (2) neither cooperative approach necessarily improves social responsibility, especially when one firm can benefit from others’ social responsibility violations (i.e., the positive externality is high). MC04 depends on contract type and the contractor’s experience. 4 - The Effects of Searching and Learning on Pick-worker Performance

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