Pricing and Capacity Allocation for Shared Services


Manufacturing & Service Operations Management

printemps 2017, vol. 19, n°2, pp.230-245

Départements : Information Systems and Operations Management

Mots clés : customer mix; customer interaction; price discrimination; capacity allocation; shared services

We study the pricing and capacity allocation problem of a service provider who serves two distinct customer classes. Customers in each class are inherently heterogeneous in their willingness to pay for service, but their utilities are also affected by the presence of other customers in the system. Specifically, customer utilities depend on how many customers are in the system at the time of service as well as who these other customers are. We find that if the service provider can price discriminate between customer classes, pricing out a class, i.e., operating an exclusive system, can sometimes be optimal and depends only on classes’ perceptions of each other. If the provider must charge a single price, an exclusive system is even more likely. We extend our analysis to a service provider who can prevent class interaction by allocating separate capacity segments to the two customer classes. Under price discrimination, allocating capacity is optimal if the “net appreciation” between classes, as defined in the paper, is negative. However, under a single-price policy, allocating capacity can be optimal even if this net appreciation is positive. We describe in detail how the nature of asymmetry in classes’ perception of each other determines the optimal strategy

Resolving the commitment-flexibility dilemna in new technology ventures


International Journal of Innovation Management

1er août 2017, vol. 21, n°6

Départements : Information Systems and Operations Management, GREGHEC (CNRS)

Mots clés : Uncertainty; flexibility; commitment; new venture project; trial and error; stakeholders

In their attempt to define radically new product–market pairs, according to the literature, new technology ventures (NTV) are confronted with an apparent dilemma. On the one hand, they should delay key commitments to remain flexible in the face of high uncertainty. On the other hand, commitments are necessary to enable learning and progress. Based on the longitudinal study of four NTVs, we find that the entrepreneurs resolve this dilemma by (i) defining their product and market progressively through iteration and learning, and by (ii) basing this progressive definition on stakeholders’ commitments. We analyse this approach and label it “commit and learn”. Following an inductive methodology, we suggest a conceptual framework to enhance the understanding of commitment as a multi-dimensional concept for new ventures

Scheduling non-operating room anesthesia cases in endoscopy: using the sandbox analogy


Journal of Clinical Anesthesia

aout 2017, vol. 40, pp.1-6

Départements : Information Systems and Operations Management, GREGHEC (CNRS)

Mots clés : Non-operating room anesthesiaUnder-utilized timeTactical decisionsStatistical process controlEndoscopyScheduling

Study objective For many hospitals, the non-operating room anesthesia (NORA) workload continues to expand. We developed a new NORA scheduling process with shared block time – a sandbox - amongst all of the gastroenterology groups and measured the efficacy of the intervention using basic operating room management metrics. Design Prospective analysis, statistical process control. Setting Academic, rural hospital; endoscopy suite; postoperative recovery area. Patients Adults and pediatric patients undergoing elective and/or urgent endoscopic procedures. Interventions In 2014, we divided the NORA block allocations on Thursdays into one afternoon block for pediatric GI, and 1.5 blocks to be shared between the two adult GI groups. We made a provision for an additional afternoon block available if necessary. No changes were made in the release policy. For scheduling, shared block time was released between the three endoscopy groups at 7 days and then opened to the general pool at 48 h. Measurements Case volumes, under-utilized time (opportunity-unused), elective time-in-block, over-utilized time. Main results With the addition of a pediatric gastroenterologist, the number of cases per month increased after the change in scheduling procedure from a mean of 107 cases per month to 131, an increase of 23% (p = < 0.01) (see Chart 1). Elective time-in-block increased after the intervention by 13% (p = 0.09), while under-utilized time (opportunity-unused time) decreased in a reciprocal fashion (15%, p = 0.03). Pre-intervention mean over-utilized time was 101 min/month, while post-intervention over-utilized time decreased by 84.5% (99% CI ± 3.29) to a mean of 16 min/month. Conclusions By using a multi-disciplinary, team-based approach, we were able to increase throughput without increasing under-utilized or over-utilized time, thereby increasing efficiency. Despite the additional cases brought in by the pediatric gastroenterologist, opportunity-unused time decreased only moderately—lending support to our prediction that opening an additional NORA block was not only unnecessary to accommodate expansion of the gastroenterology service, but was also financially unviable. One of the challenges in reducing under-utilized time lies in the relatively new role played by anesthesia in the NORA environment. In our study, we showed that the open access policy applies when the block allocations have under-utilized time. As anesthesiologists continue to expand their practice into the NORA environment, good communication, interdepartmental collaboration, and flexible scheduling processes are essential to improving efficiency

Strategic investment in protection in networked systems


Network Science

mars 2017, vol. 5, n°1, pp.108-139

Départements : Information Systems and Operations Management

We study the incentives that agents have to invest in costly protection against cascading failures in networked systems. Applications include vaccination, computer security, and airport security. Agents are connected through a network and can fail either intrinsically or as a result of the failure of a subset of their neighbors. We characterize the equilibrium based on an agent's failure probability and derive conditions under which equilibrium strategies are monotone in degree (i.e. in how connected an agent is on the network). We show that different kinds of applications (e.g. vaccination, malware, airport/EU security) lead to very different equilibrium patterns of investments in protection, with important welfare and risk implications. Our equilibrium concept is flexible enough to allow for comparative statics in terms of network properties, and we show that it is also robust to the introduction of global externalities (e.g. price feedback, congestion)

Strategic Investment in Renewable Energy Sources: The Effect of Supply Intermittency


Manufacturing & Service Operations Management

Summer 2017, vol. 19, n°3, pp.489-507

Départements : Information Systems and Operations Management, GREGHEC (CNRS)

Mots clés : Electricity Generation, Renewables, Intermittency, Capacity Planning and Investment, Incentives and Contracting

To analyze incentives for investing in the capacity to generate renewable electricity, we model the trade-off between renewable (e.g. wind) and nonrenewable (e.g. natural gas) technology. Renewable technology has a higher investment cost and yields only an intermittent supply of electricity; nonrenewable technology is reliable and has lower investment cost but entails both fuel expenditures and carbon emission costs. With reference to existing electricity markets, we model several interrelated contexts - the vertically integrated electricity supplier, market competition, and partial market competition with long-term fixed-price contracts for renewable electricity - and examine the effect of carbon taxes on the cost and share of wind capacity in an energy portfolio. We find that the intermittency of renewable technologies drives the effectiveness of carbon pricing mechanisms, which suggests that charging more for emissions could unexpectedly discourage investment in renewables. We also show that market liberalization may reduce investment in renewable capacity while increasing the overall system's cost and emissions. Fixed-price contracts with renewable generators can mitigate these detrimental effects, but not without possibly creating other problems. In short: actions to reduce the intermittency of renewable sources may be more effective than carbon taxes alone at promoting investment in renewable generation capacity

Supervising Projects You Don’t (Fully) Understand: Lessons for Effective Project Governance by Steering Committees


California Management Review

2017, vol. 59, n°2, pp.45-67

Départements : Information Systems and Operations Management

Mots clés : strategic projects, project supervision and oversight, project governance, steering committee work, focused understanding, managing surprises

Strategically important projects involve high stakes, uncertainty, and stakeholder complexity, with contingencies and risks typically surfacing repeatedly as the project evolves. This is challenging not only for the project team (PT) but also in particular for the steering committee (SC), the top management oversight structure typically used to align a project with the organization’s strategic goals. This article explores how senior executives on SCs can exercise leadership and effective oversight of strategic projects, although they have only limited time and often incomplete expertise. The SC can keep a project aligned, even with limited time, through focused understanding of the key logic and drivers of the project. The SC needs to manage the surprises and crises that inevitably arise in a difficult project through proactive analysis that goes to the bottom of the problem and by working with the PT to generate solutions

The operational impact of an acute care surgical service on operating room metrics


Perioperative Care and Operating Room Management

septembre 2017, vol. 8, pp.38-41

Départements : Information Systems and Operations Management, GREGHEC (CNRS)

Mots clés : Acute care surgeryUnder-utilized timeOver-utilized timeOperating room managementTrauma utilization

The data on the financial and operational impact of an Acute Care Surgery (ACS) service is equivocal. Multiple stakeholders, mostly surgeons and anesthesia health care providers, envision themselves as caretakers of a precious, expensive service line. Although previous studies have examined the impact of an ACS service model on the time to theater metric, there are no studies examining the impact of an ACS service on the operating room (OR) from the perspective of an OR manager. In this study, we examine the impact of an ACS service on operating room utilization and general surgery services using several OR management metrics: elective in-block utilization, after-hours utilization, and opportunity-unused time. Using these metrics to study one year pre- and one year post-ACS service implementation at our institution we were able to demonstrate more effective use of an OR (fixed cost) and a decrease in after-hours operating time for the non-ACS general surgeons (variable cost). We propose the use of such OR management metrics as an integral component of service line implementation analysis

Topological network design of closed finite capacity supply chain networks


Journal of Manufacturing Systems

octobre 2017, vol. 45, pp.70-81

Départements : Information Systems and Operations Management, GREGHEC (CNRS)

Mots clés : Closed;Finite networks;M/M/1/K;M/G/c/c;M/G/∞ queues

In this paper, we examine the layout, location, and general topological arrangement of queues in a closed finite queueing network environment for supply chains. Since our focus is on manufacturing environments, then maximizing throughput is a worthy performance measure objective. We are given a network topology G(V, E) with a finite set of nodes and edges and we wish to assign the queues to the nodes V ∈ G such a way that the maximum throughput is achieved. This is a nonlinear continuous optimization problem with implicit integer variables so the problem is at least NP-Hard. We also examine the impacts of Additive Manufacturing (AM) on the throughput of the supply chain. Decentralization of the supply chain topology as evidence by the increased dispersal of nodes within the topology tends to increase the throughput of the system, so the AM leaf nodes can have a measurable and significant impact on SCM throughput.

Adaptive use of social networking applications in contemporary organizations: Examining the motivations of Gen Y cohorts


International Journal of Information Management

December 2016, vol. 36, n°6, part A, pp.1111–1123

Départements : Information Systems and Operations Management, GREGHEC (CNRS)

Mots clés : Corporate social networking; Adaptive use intention; Technology adoption; Collaboration; Innovation; Generation Y; Motivation

With the entry of the contemporary generation (Gen Y) into the workforce, organizations are interested in leveraging Gen Y’s technological preferences when designing their information systems. Specifically, motivated by Gen Y’s dependence on Social Networking Applications (SNAs) in their private lives, organizations have initiated the implementation of Corporate Social Networks (CSNs) to facilitate closer collaboration and knowledge sharing within organizations. However, these initiatives have not been received with the expected enthusiasm from Gen Y employees. To better understand this apparent anomaly, the current study explores the Gen Y cohort’s intended adaptive use of SNAs in organizational settings, as CSNs. This study uses an enriched Delphi technique to examine the perceptions and concerns of members of Gen Y regarding use of CSNs. In addition, employing a structured qualitative approach and contextualizing the needs hierarchy theory to the specific case of Gen Y employees, this study identifies six organizational requirements for successfully implementing CSNs. This work extends the literature on adaptive use of Enterprise 2.0 systems and delineates a set of useful implications for managers intending to implement such systems for Gen Y employees.

Contributions of Design Thinking to Project Management in an Innovation Context


Project Management Journal

avril-mai 2016, vol. 47, n°2, pp.144-156

Départements : Information Systems and Operations Management, GREGHEC (CNRS)

Mots clés : Project management, Design, Innovation, Uncertainty, Design thinking

Researchers have long recognized that standard approaches to project management are ill-suited to address changes in the environment or business needs, particularly in innovative contexts characterized by uncertainty and complexity. Instead of being concerned with the efficient implementation of a deliberate strategy, a project in such a context becomes a process for strategy formulation. Three imperatives for project management arise as a result: managing the explorative phase, managing the involvement of stakeholders in the project, and managing the project in relation to the strategizing process of the firm. We propose that design thinking, a recent evolution in the field of design, can make some important contributions to these imperatives. Design thinking has been highlighted by practitioners as well as academia as a novel methodology that is potentially valuable for improving innovative outcomes, whether they are products, services, or strategies. We examine and articulate these possible contributions through 10 propositions that could form an agenda for future experimentation and empirical research on innovation project management