Operations & Supply Chain Management

In many service industries, companies compete with each other on the basis of the waiting time their customers experience, along with other strategic instruments such as the price they charge for their service. The objective of this paper is to conduct an empirical study of an important industry to measure to what extent waiting time performance impacts different firms' market shares and price decisions.

We propose and analyze a general periodic-review model in which the firm has access to a set of potential suppliers, each with specific yield and price characteristics. Assuming that unsatisfied demand is backlogged, the firm incurs three types of costs: (i) procurement costs, (ii) inventory-carrying costs for units carried over from one period to the next, and (iii) backlogging costs.

While millions of products are sold on its retail platform, Amazon.com itself stocks and sells only a very small fraction of them. Most of these products are sold by third-party sellers who pay Amazon a fee for each unit sold. Empirical evidence clearly suggests that Amazon tends to sell high-demand products and leave long-tail products for independent sellers to offer.

Many organizations, such as banks, airlines, telecommunications companies, and police departments, routinely use queueing models to help manage and allocate resources in order to respond to demands in a timely and cost-efficient fashion. Though queueing analysis has been used in hospitals and other healthcare settings, its use in this sector is not widespread.

This study investigates the information content of variation analysis—that is, analysis of year-over-year changes in the components of operating profit. Using industry level data, we find that the effects on profitability of changes in the prices of output products and costs of intermediate inputs are more persistent than the effects of changes in output volume, labor cost, labor productivity, and intermediate input productivity. We further show that this information is priced by investors.

This special issue features articles from the 9th Annual INFORMS Revenue Management and Pricing Section Conference at the Kellogg School of Management, Northwestern University during 22–23 June 2009. The conference featured 42 half hour talks by practitioners and researchers, as well as keynote addresses by Professor Anton Kleywegt of Georgia Tech and by Dr Matthew Schrag, the Director of Operations Research and Industrial Engineering at Delta Airlines. The conference was organized by Martin Lariviere and Baris Ata.

It is widely accepted that entrepreneurial creation affects destruction, as new and better organizations, technologies and transactions replace old ones. This phenomenon is labeled creative destruction, but it might more accurately be called destructive creation, given the driving role of creation in the process. We reverse the typical causal ordering, and ask whether destruction may drive creation. We argue that economic systems may get stuck in suboptimal equilibria due to path dependence, and that destruction may sweep away this inertia, and open the way for entrepreneurship.