Informs 2015

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INFORMS Philadelphia – 2015
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MB39
39-Room 100, CC
Contracts, Quality, and Pricing for OM-Marketing
Cluster: Operations/Marketing Interface
Invited Session
Chair: Haresh Gurnani, Professor, Wake Forest University, School of
Business and Center for Retail, Winston Salem, NC, 27106, United
States of America,
Co-Chair: Shouqiang Wang, Assistant Professor, Clemson University,
131D Sirrine Hall, Clemson, SC, 29672, United States of America,
1 - Signaling Trustworthiness using a Buy-back Contract
Shouqiang Wang, Assistant Professor, Clemson University, 131D
Sirrine Hall, Clemson, SC, 29672, United States of America,
Haresh Gurnani
Not all suppliers are trustworthy: retailers face risk dealing with suppliers who
may not honor their buy-back contracts. We examine whether an upstream
manufacturer is able to signal her trustworthiness via the buy-back contract terms
(i.e., the wholesale and return prices) offered to a retailer; and if so, how such a
buy-back contract needs to be structured.
2 - Optimal Design of Sales Service Channel
Huaqing Wang, Asst Professor, University of Wisconsin Stout, 262
JHTW, 410 10th Ave E, Menomonie, United States of America,
Haresh Gurnani, Yu Tang
Customers buying certain products may lack functional knowledge and need help
after purchase. The retailer (or manufacturer) can invest in pre-sales effort to
educate customers; We study the service channel design problem with different
structures and show that the retailer would even be worse off in a cost-sharing
contract.
3 - Quality Provision with Heterogeneous Consumer
Reservation Utilities
Rachel Chen, Associate Professor, University of California, Davis,
CA, United States of America, Lian Qi,
Leon Chu
This paper examines a firm’s quality and price decisions when consumers differ in
both their willingness-to-pay for quality and in their reservation utility for the
basic product. We find that the optimal quality may increase with a negative shift
in consumers’ reservation utilities. When the firm offers a vertically differentiated
product line, the concern for cannibalization may distort the quality upwards
under heterogeneous reservation utilities.
4 - Dynamic Matching in a Two-sided Market
Yun Zhou, University of Toronto, 105 St. George Street, Toronto,
Canada, , Ming Hu
A two-sided market often shares a common structure that engages three parties:
the supply side, the demand side and an intermediate firm facing intertemporal
uncertainty on both supply/demand sides. We propose a general framework of
dynamically matching supply with demand of heterogenous types (with
horizontally or vertically differentiated types as special cases) by the intermediary
firm and explore the optimal and heuristic matching policies.
MB40
40- Room 101, CC
Nonmarket Strategy
Sponsor: Organization Science
Sponsored Session
Chair: Jiao Luo, University of Minnesota, 321-19th Ave S, Suite 3-365,
Minneapolis, MN, 55455, United States of America,
1 - Radical Repertoires: The Incidence and Impact of
Corporate-Sponsored Social Activism
Mary-hunter McDonnell, The Wharton School, University of
Pennsylvania, Philadelphia, PA,
This article explores situations in which firms respond to contentious social
activist challenges by openly sponsoring social movements. I empirically explore
the emergence and implications of a new strategic phenomenon in non-market
strategy – the corporate-sponsored boycott – in which firms voluntarily cooperate
with social movement organizations to protest contested social practices of other
companies or entities at higher orders of market organization, such as industries
and states.
2 - When Does a Stakeholder Attack Become a Reputational Crisis?
Stakeholder Capital and the Micro-Foundations of
Corporate Reputation
Sinziana Dorobantu, New York University, New York, NY,
Witold J. Henisz, Lite Nartey
We provide and demonstrate empirical support for theoretical arguments on the
micro-foundations of corporate reputation thereby explaining which stakeholder
attacks are more likely to become organizational reputational crises that destroy
financial value. We evaluate stakeholder reactions to attacks targeting 19 gold
mining firms between 2000 and 2008 as reported in over 20,000 media articles,
and link these reactions to the daily abnormal returns of these publicly traded
companies.
3 - Micro-foundations of Corporate Social Responsibility
and Irresponsibility
Olga Hawn, UNC Kenan-Flagler Business School, Chapel Hill, NC,
United States of America,
Catherine Shea
This study examines how two fundamental dimensions of social
perceptionówarmth and competenceó mediate and moderate the effects of
corporate social responsibility (CSR) and irresponsibility (CSI) on specific
outcomes. The results of our experimental studies suggest that firms from high-
warmth countries receive lower benefits for CSR and pay higher penalties for CSI
than firms from low-warmth countries; furthermore, this effect reverses when
combined with high competence.
4 - The Economic Case for CSR: Competitive Advantage of For-profit
Firms in the Market for Social Goods
Jiao Luo, University of Minnesota, 321-19th Ave S,
Suite 3-365, Minneapolis, MN, 55455, United States of America,
, Aseem Kaul
We develop a formal model of CSR, examining competition between a for-profit
firm and a nonprofit in the supply of social goods. We argue that firms can benefit
both stakeholders and shareholders only if their CSR efforts are sufficiently
differentiated from those of non-profits. Thus, our paper makes an economic case
for CSR, specifying conditions under which CSR is Pareto optimal, and
highlighting the potentially divergent effects of CSR activities for shareholders
and stakeholders.
MB41
41-Room 102A, CC
New Development in Health Care Operations
Sponsor: Manufacturing & Service Oper
Mgmt/Healthcare Operations
Sponsored Session
Chair: Lauren Lu, Associate Professor, University of North Carolina at
Chapel Hill, Kenan-Flagler Business School, Chapel Hill, NC, 27599,
United States of America,
Co-Chair: Feng Lu, Assistant Professor, Purdue University, 403 W State
St, West Lafayette, IN, 47907, United States of America,
1 - Do Mandatory Overtime Laws Improve Quality? Staffing and
Operational Flexibility of Nursing Homes
Lauren Lu, Associate Professor, University of North Carolina at
Chapel Hill, Kenan-Flagler Business School, Chapel Hill, NC,
27599, United States of America, , Feng Lu
During the 2000s, over a dozen U.S. states passed laws that prohibit health care
employers from mandating overtime for nurses. Using a nationwide panel dataset
from 2004 to 2012, we find that these mandatory overtime laws reduce the
service quality of nursing homes. This outcome can be explained by two
undesirable changes in the staffing hours of registered nurses: decreased hours of
permanent nurses and increased hours of contract nurses per resident day.
2 - The Hidden Costs of Hospitals’ “Custom Contracting” with Group
Purchasing Organizations
Avi Seidmann, Simon Business School, University of Rochester,
Rochester, NY, 14627, United States of America,
Vera Tilson, Rajib Saha
Most hospitals in the US join Group Purchasing Organizations (GPOs) to lower
procurement costs by demand aggregation. Some larger hospitals further
negotiate private deals through custom contracts directly with the GPO vendors.
We present a game-theoretic model where the decisions by the hospitals and the
vendor are endogenous, and we prove that – counter to the industry’s
expectations - the resulting savings for the hospitals are always lower when the
GPOs go for custom contracting.
MB41