2015 Informs Annual Meeting

TC56

INFORMS Philadelphia – 2015

4 - The Bright Side of Managerial Overconfidence Juan Li, Assistant Professor, Nanjing University, No. 5 Ping Cang Xiang, Nanjing, China, juanli@nju.edu.cn, Baojun Jiang, Fuqiang Zhang Managers are often overconfident about the accuracy of their demand forecast. This paper shows that the firm may actually benefit from such overconfidence bias whether or not its competitor has such bias. Further, such bias can lead to a win-win situation for both competing firms. TC54 54-Room 108A, CC Discrete Optimization Models for Homeland Security and Disaster Management Chair: Laura Mclay, Associate Professor, University of Wisconsin, 1513 University Ave, ISYE Department, Madison, WI, 53706, United States of America, lmclay@wisc.edu 1 - Discrete Optimization Models for Homeland Security and Disaster Management Laura Mclay, Associate Professor, University of Wisconsin, 1513 University Ave, ISYE Department, Madison,WI, 53706, United States of America, lmclay@wisc.edu Preparing for and responding to disasters, including acts of terrorism, is an important issue of national and international concern. Recent disasters underscore the need to manage disasters to minimize their impact on critical infrastructure and human suffering. In this tutorial, we survey the operations research literature that develops, analyzes and applies discrete optimization models to effectively mitigate, prepare for, respond to and recover from a wide variety of disasters. Yanni Ping, Drexel University, 3220 Market Street, Gerri C. LeBow Hall 730, Philadelphia, PA, 19104, United States of America, yp86@drexel.edu, Seung-lae Kim, Min Wang Facing limited capacity, a manufacturer would often rely on external suppliers. How to select suppliers to work with becomes a strategic decision particularly when demand for the final product is quality driven. In this talk, we adopt a Taguchi loss function as a supplier’s quality measurement and present a dynamic programming model to explore how supplier quality affects manufacturer’s outsourcing strategy. We propose simple and efficient algorithms for supplier selection in a dynamic setting. 2 - Fixed Entry Cost Effect on Contract Length and Renewals in a Maintenance Service Contract Systems We analyze how the inclusion of a fixed entry cost will affect the decision making of a maintenance contract, using a model that evaluates the contract value for the vendor according to the contract duration and its renewals. The analysis considers different scenarios that show the existence of a relationship between the length of the contract and the amount of renovations from which the contract is valuable for the vendor. 3 - Long-term Outsourcing under Stochastic Learning and Information Asymmetry Ting Luo, University of Texas at Dallas, 800 W Campbell Rd, Richardson, TX, 75080, United States of America, ting.luo@utdallas.edu Suppliers can reduce their cost through learning by doing, however their learning abilities and outcomes are kept as private information. When buyers design the procurement contract, they must consider the above effects. We study the interplay of stochastic learning and information asymmetry. We show that the stochastic learning has a profound impact on the optimal contract. Rodrigo Ulloa, Pontificia Universidad Católica de Chile, Av. Vicuña Mackenna 4860, Santiago, Chile, rsulloa@uc.cl, Alejandro Mac Cawley, Rodrigo Pascual, Gabriel Santelices Cluster: Tutorials Invited Session TC55 55-Room 108B, CC Outsourcing I Contributed Session Chair: Ting Luo, University of Texas at Dallas, 800 W Campbell Rd, Richardson, TX, 75080, United States of America, ting.luo@utdallas.edu 1 - Outsourcing Supplier Selection: Quality-driven Demand and Taguchi Loss Function

4 - Opportunism in Manufacturing Outsourcing Keith Skowronski, The Ohio State University, Fisher 251A, 2100 Neil Avenue, Columbus, OH, 43210, United States of America, skowronski.2@osu.edu, W. C. Benton Using dyadic buyer-supplier data, we empirically examine two types of supplier opportunism, poaching and shirking, in manufacturing outsourcing relationships. In this multi-country study, the legal environment of the supplier’s location is hypothesized to moderate the relationships between exchange hazards, relational governance mechanisms and the different forms of opportunism. 5 - Suppliers as Liquidity Providers Panos Markou, IE Business School, Calle Maria de Moina 12 Bajo, Madrid, 28006, Spain, pmarkou.phd2016@student.ie.edu, Daniel Corsten Using a novel dataset comprising the top 10 suppliers of more than 80,000 public and private companies, we examine the value of having a supplier that is not financial constrained. For financially constrained customers, holding cash is costly. However, we show that having even one financially unconstrained supplier allows these customers to “outsource” some of their cash holdings. Financial standing is an important consideration when choosing suppliers.

TC56 56-Room 109A, CC Commercialization of New Technologies Cluster: New Product Development Invited Session

Chair: Karthik Ramachandran, Georgia Institute of Technology, 800 West Peachtree NW, Atlanta, GA, 30308, United States of America, Karthik.Ramachandran@scheller.gatech.edu

Co-Chair: Sreekumar Bhaskaran, SMU, Dallas, TX, United States of America, sbhaskar@cox.smu.edu 1 - Product Line Design for Strategic Customers

Saurabh Bansal, Assistant Professor, Penn State Univrsity, 405 Business Building, University Park, PA, 16802, United States of America, sub32@psu.edu, Karthik Ramachandran We report results for optimal product line design when customers are strategic about uncertain quality of products. Our analysis explains evolution of product lines observed in practice. 2 - Licensing Contracts: Control Rights and Options Niyazi Taneri, SUTD, 8 Somapah Rd, Singapore, Singapore, niyazitaneri@sutd.edu.sg, Pascale Crama, Bert De Reyck Research and development (R&D) collaborations, though common in high-tech industries, are challenging to manage due to technical and market risks as well as incentive problems. We investigate the impact of control rights, options, payment terms and timing decisions on R&D collaborations between an innovator and a marketer. We provide recommendations on the optimal contract structure and timing based on the R&D project characteristics. 3 - Does Equity Crowdfunding Improve Entrepreneurial Firm Performance? Susanna Khavul, UTA/London School of Economics, London, United Kingdom, s.khavul@lse.ac.uk, Saul Estrin As a fast moving financial innovation, equity crowdfunding may relax resource constraints for new ventures. Using four years of proprietary data, we model how information provision, generation, and exchange affects the supply of funds and likelihood of pitch funding. We evaluate this against the survival and performance of the firms that sought funding.

337