Lincoln C. Wood, Torsten Reiners, H. S. Srivastava
{"title":"Exploring Sentiment Analysis to Improve Supply Chain Decisions","authors":"Lincoln C. Wood, Torsten Reiners, H. S. Srivastava","doi":"10.2139/ssrn.2665482","DOIUrl":"https://doi.org/10.2139/ssrn.2665482","url":null,"abstract":"Purpose: Traditional information sharing and supply chain decisions are examined in light of emerging technologies. Focusing on the bullwhip effect, implications of information asymmetry for upstream firms, distant from a market, are highlighted. A novel approach is presented as effective for sensing changes in market demand without reliance on supply chain partners.Design/methodology/approach: Remedies for the bullwhip effect based on traditional supply chain management techniques and technologies are discussed, providing a series of succinct hypotheses that summarise key relationships. These hypotheses are used to establish the usefulness of an emerging technology. Findings: The paper explains how the emerging technology of sentiment analysis can meet the same fundamental requirements for supply chain managers. Through rapid and real-time monitoring of aggregated opinions expressed in social media, upstream suppliers can gather additional external data that reduce reliance on supply chain partners to achieve the same objectives. Research limitations/implications: The effectiveness of the process is demonstrated by logically extrapolating that the approach is valuable to upstream companies, after showing that a consumer-facing firm can use the approach with accuracy. Practical implications: The practical value of textual data analysis is highlighted to emphasise how upstream firms can improve sensitivity to market demand changes, without requiring collaboration with supply chain members.Originality/value: Through the novel application of sentiment analysis to support supply chain management, the value of this paper is the unique opportunity logically afforded upstream firms to increase transparency and speed of response to market changes.","PeriodicalId":49886,"journal":{"name":"Manufacturing Engineering","volume":"98 1","pages":""},"PeriodicalIF":0.3,"publicationDate":"2015-09-25","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"74187872","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":4,"RegionCategory":"工程技术","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
T. Soltani, A. Chockalingam, J. Fransoo, Chung-Yee Lee
{"title":"Transporting Commodities: Hedging Against Price, Demand and Freight Rate Risk with Options","authors":"T. Soltani, A. Chockalingam, J. Fransoo, Chung-Yee Lee","doi":"10.2139/ssrn.2661571","DOIUrl":"https://doi.org/10.2139/ssrn.2661571","url":null,"abstract":"Like options on stocks, options on commodities provide firms with protection against adverse price movements. Many firms procure commodity at an offshore location and transport it via ocean freight. Increased globalization and increased demand for ocean-based transportation has resulted in ocean freight itself becoming a volatile commodity. We consider a commodity processor and develop models to determine the firm’s optimal hedging policy. The models allow for three sources of uncertainty; demand, commodity spot price and freight rate. The scenarios differ based on assumptions on independence between the uncertainties, and also assumptions on market competitiveness. The optimal hedging policies are variants of the classical newsvendor critical fractile. We show that partially procuring the commodity and its freight through option contracts, rather than entirely on the volatile spot market creates value, even for a risk-neutral firm. We then perform extensive numerical experiments to study the influence of the underlying parameters on the optimal hedging policies and value creation.","PeriodicalId":49886,"journal":{"name":"Manufacturing Engineering","volume":"79 1","pages":""},"PeriodicalIF":0.3,"publicationDate":"2015-09-16","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"90601905","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":4,"RegionCategory":"工程技术","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
A. Agrawal, YoungSook Kim, H. D. Kwon, Suresh Muthulingam
{"title":"Investment in Shared Suppliers: Effect of Learning, Spillover, and Competition","authors":"A. Agrawal, YoungSook Kim, H. D. Kwon, Suresh Muthulingam","doi":"10.1111/POMS.12503","DOIUrl":"https://doi.org/10.1111/POMS.12503","url":null,"abstract":"We investigate the optimal strategies for firms to invest in their suppliers when the benefits of such investments can spillover to other firms who also source from the same suppliers. We consider two Bayesian firms that can invest in improving the quality of their shared supplier; the firms do not have complete information on the true quality of the supplier, but they update their beliefs based on the supplier's performance. We formulate the problem as an investment game and obtain Markov perfect equilibria characterized by the investment thresholds of both firms. The equilibrium investment strategies of the two firms are characterized by a region of preemption and a region of war of attrition. We also examine how the interplay between spillover, competition, and returns from the investment at shared suppliers affect the investment threshold and the time to the leader's investment, and identify the conditions under which competition delays or hastens the first investment in a shared supplier.","PeriodicalId":49886,"journal":{"name":"Manufacturing Engineering","volume":"13 1","pages":""},"PeriodicalIF":0.3,"publicationDate":"2015-08-05","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"83361997","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":4,"RegionCategory":"工程技术","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
{"title":"Customer-Base Concentration and Inventory Efficiencies: Evidence from the Manufacturing Sector","authors":"B. K. Ak, Panos N. Patatoukas","doi":"10.2139/ssrn.2423054","DOIUrl":"https://doi.org/10.2139/ssrn.2423054","url":null,"abstract":"What is the link between customer-base concentration and inventory efficiencies in the manufacturing sector? Using hand-collected data from 10-K Filings, we find that manufacturers with more concentrated customer bases hold fewer inventories for less time and are less likely to end up with excess inventories, as indicated by the lower likelihood and magnitude of inventory write-downs and reversals. Using disaggregated inventory disclosures, we find that inventory efficiencies primarily flow through the finished goods inventory account, while raw material efficiencies are offset by higher work-in-process holdings and longer work-in-process cycles. In additional analysis, we document a valuation premium for more concentrated manufacturers after controlling for other firm characteristics, including default risk and cost of capital estimates. We conclude that investors trade off the costs and benefits of relationships with a limited number of major customers and, on balance, consider customer-base concentration as a net positive for firm valuation. Overall, our study adds to interdisciplinary research in accounting and operations management by shedding new light on the relevance of major customer disclosures for fundamental analysis and valuation in the manufacturing sector.","PeriodicalId":49886,"journal":{"name":"Manufacturing Engineering","volume":"2 1","pages":""},"PeriodicalIF":0.3,"publicationDate":"2015-06-09","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"83499738","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":4,"RegionCategory":"工程技术","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
{"title":"Contract Types and Supplier Incentives for Quality Improvement","authors":"Jiguang Chen, Q. Hu, Jing-Sheng Song","doi":"10.2139/ssrn.2608772","DOIUrl":"https://doi.org/10.2139/ssrn.2608772","url":null,"abstract":"When firms outsource production to suppliers, a key concern is how to control product quality and to motivate the supplier to invest in quality improvement. In practice, several kinds of quality management contracts are commonly used, such as subsidizing the supplier’s quality investment, setting a defect rate target, and a combination of both. This paper analyzes and compares the effectiveness of these approaches in a stylized two-echelon supply chain with deterministic market demand and imperfect batch production process. We show that the appropriateness of a contract form depends on the supplier’s initial quality level as well as the information structure about this level.","PeriodicalId":49886,"journal":{"name":"Manufacturing Engineering","volume":"34 13 1","pages":""},"PeriodicalIF":0.3,"publicationDate":"2015-05-16","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"77238278","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":4,"RegionCategory":"工程技术","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
{"title":"Public-Private Partnerships and Infrastructural Supply Chain Sustainability","authors":"Roberto Moro Visconti","doi":"10.2139/ssrn.2604701","DOIUrl":"https://doi.org/10.2139/ssrn.2604701","url":null,"abstract":"The managerial issue of sustainability is critical for most business functions and is consequently widely dealt with in Supply Chain Management (SCM) literature. Overarching infrastructural Supply Chains (SCs), typically considered “public goods�?, represent a vital backbone for underlying private SCs within Public-Private Partnerships (PPPs) agreements. Within this framework, the purpose of this paper is to examine how infrastructural SCs may synergistically interact with their underlying chains, promoting overall sustainability. Innovative analysis of PPP and SC literature, combined with empirical evidence from public healthcare infrastructural investments, shows that social, economic, and environmental sustainability is still an uphill target that requires public subsidies. Public contribution may however be partially funded by the creation of taxable added value, stimulating sustainable growth patterns.","PeriodicalId":49886,"journal":{"name":"Manufacturing Engineering","volume":"6 1","pages":""},"PeriodicalIF":0.3,"publicationDate":"2015-05-11","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"89911576","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":4,"RegionCategory":"工程技术","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
{"title":"Non-Linear Pricing Competition with Private Capacity Information","authors":"Hamid Nazerzadeh, G. Perakis","doi":"10.2139/ssrn.2586265","DOIUrl":"https://doi.org/10.2139/ssrn.2586265","url":null,"abstract":"We study a common agency model with informed principals consisting of two capacity-constrained suppliers and a single retailer. The capacity of each supplier is her private information. Conditioned on their capacities, the suppliers simultaneously and non-cooperatively offer quantity-price schedules to the retailer. Then, the retailer decides on the quantities to purchase from each supplier in order to maximize his own utility. We prove the existence of a (pure strategy) Nash equilibrium for this game. We show that at the equilibrium each (infinitesimal) unit of the supply is assigned a marginal price which is independent of the capacities and depends only on the valuation function of the retailer and the distribution of the capacities. In addition, the supplier with the larger capacity sells all her supply.","PeriodicalId":49886,"journal":{"name":"Manufacturing Engineering","volume":"33 1","pages":""},"PeriodicalIF":0.3,"publicationDate":"2015-03-27","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"86771914","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":4,"RegionCategory":"工程技术","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Claire Senot, Aravind Chandrasekaran, Peter T. Ward, Anita L. Tucker, S. Moffatt-Bruce
{"title":"The Impact of Combining Conformance and Experiential Quality on Hospitals’ Readmissions and Cost Performance","authors":"Claire Senot, Aravind Chandrasekaran, Peter T. Ward, Anita L. Tucker, S. Moffatt-Bruce","doi":"10.1287/mnsc.2014.2141","DOIUrl":"https://doi.org/10.1287/mnsc.2014.2141","url":null,"abstract":"To investigate the opportunity for hospitals to achieve better care at lower cost, we examine two key process quality measures, conformance quality and experiential quality, and two measures of performance, readmission rate and cost per discharge. Conformance quality represents a hospital’s level of adherence to evidence-based standards of care, whereas experiential quality represents the level of interaction between hospital’s caregivers and patients. Analyzing six years of data from 3,474 U.S. acute care hospitals, we find that combining conformance and experiential quality results in lower readmission rates. However, conformance quality and experiential quality each independently increase cost per discharge, which suggests that a readmissions–costs trade-off is unavoidable. To investigate this further, we conduct post hoc analyses by distinguishing between the granular elements of experiential quality (EQ) based on task type: response-focused EQ and communication-focused EQ. Response-focused EQ measure...","PeriodicalId":49886,"journal":{"name":"Manufacturing Engineering","volume":"18 1","pages":""},"PeriodicalIF":0.3,"publicationDate":"2014-12-04","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"86631752","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":4,"RegionCategory":"工程技术","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
{"title":"Product Assortment and Price Competition Under Multinomial Logit Demand","authors":"Omar Besbes, Denis Sauré","doi":"10.2139/ssrn.2406158","DOIUrl":"https://doi.org/10.2139/ssrn.2406158","url":null,"abstract":"type=\"main\" xml:id=\"poms12402-abs-0001\"> The role of assortment planning and pricing in shaping sales and profits of retailers is well documented and studied in monopolistic settings. However, such a role remains relatively unexplored in competitive environments. In this study, we study equilibrium behavior of competing retailers in two settings: (i) when prices are exogenously fixed, and retailers compete in assortments only; and (ii) when retailers compete jointly in assortment and prices. For this, we model consumer choice using a multinomial Logit, and assume that each retailer selects products from a predefined set, and faces a display constraint. We show that when the sets of products available to retailers do not overlap, there always exists one equilibrium that Pareto-dominates all others, and that such an outcome can be reached through an iterative process of best responses. A direct corollary of our results is that competition leads a firm to offer a broader set of products compared to when it is operating as a monopolist, and to broader offerings in the market compared to a centralized planner. When some products are available to all retailers, that is, assortments might overlap, we show that display constraints drive equilibrium existence properties.","PeriodicalId":49886,"journal":{"name":"Manufacturing Engineering","volume":"21 1","pages":""},"PeriodicalIF":0.3,"publicationDate":"2014-12-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"82502819","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":4,"RegionCategory":"工程技术","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
{"title":"Optimal Dynamic Pricing with Demand Model Uncertainty: A Squared-Coefficient-of-Variation Rule for Learning and Earning","authors":"N. B. Keskin","doi":"10.2139/ssrn.2487364","DOIUrl":"https://doi.org/10.2139/ssrn.2487364","url":null,"abstract":"We consider a price-setting firm that sells a product over a continuous time horizon. The firm is uncertain about the sensitivity of demand to price adjustments, and continuously updates its prior belief on an unobservable sensitivity parameter by observing the demand responses to prices. The firm’s objective is to minimize the infinite-horizon discounted loss, relative to a clairvoyant that knows the unobservable sensitivity parameter. Using partial differential equations theory, we characterize the optimal pricing policy, and then derive a formula for the optimal learning premium that projects the value of learning onto prices. We compare and contrast the optimal pricing policy with the myopic pricing policy, and quantify the cost of myopically neglecting to charge a learning premium in prices. We show that the optimal learning premium for a firm that looks far into the future is the squared coefficient of variation (SCV) in the firm’s posterior belief. Based on this principle, we design a simple variant of the myopic policy, namely the SCV rule, and prove that this policy is long-run average optimal.","PeriodicalId":49886,"journal":{"name":"Manufacturing Engineering","volume":"33 1","pages":""},"PeriodicalIF":0.3,"publicationDate":"2014-08-03","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"74290591","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":4,"RegionCategory":"工程技术","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}