We are organizing a workshop to honor John Buzacott on his 80th birthday and his achievements in Operations Management. The workshop program is shown below. If you are interested in attending this workshop, please contact George Shanthikumar (Shanthikumar@purdue.edu) or David Yao (yao@columbia.edu).
WORKSHOP IN HONOR OF JOHN A. BUZACOTT'S 80TH BIRHTDAY
June 18, 9:30 am to 5:00 pm
Franklin Hotel, 311 W Franklin St, Chapel Hill, NC
PROGRAM
09:30 am to 09:45 am: Introduction & Workshop Kick-off: J. George Shanthikumar
09:45 am to 10:15 am: Speaker: John A. Buzacott, Schulich School of Business, York University, York, Ontario, Canada
Title: Manufacturing Systems Research: Ideas and Issues
Abstract: This talk is about how ideas for research emerge. Looking at my experience, I talk about how I became aware of issues in manufacturing system design and operation and how this awareness became research. I conclude with some remarks about whether I can make meaningful predictions about what issues might emerge and hence determine the direction of future research.
10:15 am to 10:45 am: Speaker: Candace A. Yano, IEOR Dept. and Haas School of Business, University of California, Berkeley, CA
Title: Optimizing Prices for Substitutable Products over a Multi-Period Horizon
Abstract: We address a retailer's problem of setting prices, including promotional prices, over a multi-period horizon for non-seasonal substitutable products within a category, considering the effects of reference prices on customers' strategic buying behavior, including stockpiling. We first develop a model of consumer response that is based upon consumers approximately optimizing their purchasing and consumption decisions over multiple periods to maximize utility in response to any trajectory of prices that the retailer may offer. We then embed the approximately optimal consumer response into the retailer's price optimization problem. We present structural results and examples that provide insight into the properties of optimal policies.
(Joint work with: Kevin Li, IEOR Dept., UC Berkeley)
10:45 am to 11:15 am: Break
11:15 am to 11:45 am: Speaker: Diwakar Gupta, University of Minnesota, Minneapolis, MN
Title: Hospital-physician Gainsharing Contracts
Abstract: Episode Payment Models allow participants (hospitals) to realize gains from cost reduction and to share them with collaborators (physicians). The Social Security Act, State regulations, and safe harbors constraints limit the types of gainsharing contracts that may exist between participants and collaborators. We develop gainsharing contracts that do not implicate the Social Security Act, mitigate agency costs, and the impact of different levels of risk aversion.
(Joint work with: Mili Mehrotra, Xiaoxu Tang, University of Minnesota)
11:45 am to 12:15 pm: Speaker: Seyed M. R. Iravani, Industrial Engineering and Management Sciences, Northwestern University, Evanston, IL, 60208
Title: Observational Learning in Environments with Multiple Choice Options: The Wisdom of Majorities and Minorities
Abstract: The talk focuses on observational learning in environments in which customers choose among multiple options with uncertain quality for which they observe the aggregate choices of previous customers (the sales of each option). When customers have heterogeneous knowledge about the quality of the options, the choices of the better informed customers turn sales into informative signals, allowing less informed customers to learn about the options' quality. We characterize the equilibrium choices in environments with any number of options. Although uninformed customers avoid options with no sales, they often prefer minority options with low sales over majority option with higher sales. We find the conditions for this effect, i.e., "minority wisdom," to arise when the number of options is large, and when the fraction of informed customers in the market is low. We test the prediction from our observational learning model in the laboratory. The data shows that human subjects occasionally follow minorities, but significantly less often than predicted by the full rationality paradigm of our equilibrium model. Noisy decision making provides a simple explanation for the observed pattern: when minority options may emerge because of a random error, rather than a rational choice, their value as a quality signal is diminished.
12:15 pm to 01:30 pm: Lunch
01:30 pm to 02:00 pm: Speaker: J. George Shanthikumar, Krannert School of Management, Purdue University, West Lafayette, IN 47907.
Title: Dynamic Pricing and Inventory Management with Dependent Random Supply Capacities
Abstract: We consider a firm who replenishes from a set of suppliers whose capacities are positively dependent. Extending the notion of stochastic linearity via transforming the problem into one defined on a function space, we show that the objective of the dynamic inventory-pricing problem can be written as a concave optimization problem. This observation allows us to establish the optimality of an almost threshold replenishment policy. Specifically, there is a reorder point for each supplier such that no order is issued to him when the inventory level is above this point and a positive order is placed almost everywhere when the inventory level is below this point.
(Joint work with: Qi Annabelle Feng, and Zheng Justin Jia, Krannert School of Management, Purdue University)
02:00 pm to 02:30 pm: Speaker: Qi A. Feng, Krannert School of Management, Purdue University, West Lafayette, IN 47907
Title: Understanding Valuation Distribution for Dynamic Pricing and Bargaining
Abstract: When a firm selling a product to a market with heterogeneous consumers, the revenue generated can be greatly dependent on the distribution of consumers' valuations affects. We introduce a stochastic order, called scaled pricing order, for the buyer's valuation distribution. This order allows us to compare how profitable different consumer markets in terms of the firm's probability by posting a price. Moreover, the scaled pricing order also determines the firm's dynamic choice between pricing and bargaining as alternative selling mechanisms.
(Joint work with: J. George Shanthikumar, Krannert School of Management, Purdue University)
02:30 pm to 03:00 pm: Speaker: Tava M. L. Olsen, Faculty of Business and Economics, The University of Auckland, NZ.
Title: Modeling Contracts and Incentives in Agricultural Cooperative Supply Chains
Abstract: In agricultural marketing co-operatives (co-ops), a group of farmers, or growers, collaborate under a single cooperative organizational structure to process and market their products. The trade-offs faced within the supply chain are often different to those faced by traditional investor-owned firms. For example, most co-ops pledge to take all products produced by farmers, rather than being able to place specific orders with suppliers. Further, operational and financial decisions become inseparable because capital investment decisions are linked to the co-op's economic transactions with its members. Supply yield uncertainty adds another dimension to the difficulty of coordinating the supply chain. In this talk I consider contacts and incentives in the agricultural supply chain. I discuss my recent research in this area and highlight possibilities for future research.
03:00 pm to 03:30 pm: Break
03:30 pm to 04:00 pm: Speaker: Jing-Sheng Song, The Fuqua School of Business, Duke University, Durham, NC 27708, USA
Title: Optimal Policies for a Dual-Sourcing Inventory Problem with Endogenous Stochastic Leadtimes
Abstract: We consider a single-product dual-sourcing inventory system with a Poisson demand process and complete backlogging. The normal supply source consists of a two-stage tandem queue with exponential production time at each stage. The emergency source skips the first stage, for a fee. We characterize optimal ordering policies.
(Joint work with: Li Xiao, CUHK Business School, The Chinese University of Hong Kong, Hong Kong; Hanqin Zhang, Business School, The National University of Singapore; Paul Zipkin, The Fuqua School of Business, Duke University)
04:00 pm to 04:30 pm: Speaker: David Yao, Department of Industrial Engineering and Operations Research, Columbia University, New York, NY
Title: Production with Risk Hedging
Abstract: Traditional production planning is primarily a quantity or capacity decision, which must be made at the beginning of a planning horizon before production starts. Adding a risk-hedging strategy throughout the horizon can better manage the risk involved in demand volatility. We demonstrate how this can be done and characterize the improvement in risk-return tradeoff achieved by the hedging strategy.
(Joint work with Liao Wang, Department of Industrial Engineering and Operations Research, Columbia University)
04:30 pm to 05:00 pm: Laudatory (coordinated by Kathy E. Stecke, University of Texas, Dallas, TX)
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J. George Shanthikumar
Richard E. Dauch Chair of Manufacturing and Operations Management and Distinguished Professor of Management
Krannert Graduate School of Management, Purdue University
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