Contracting Under Vendor Managed Inventory Systems Using Holding Cost Subsidies

Vendor managed inventory systems are becoming increasingly popular. An important issue in implementing a vendor managed inventory scheme is the contracting terms that dictate the ownership of the inventory and the responsibility of inventory replenishment decisions. Thus the performance of a vendor managed system crucially depends on these terms and on how inventory‐related costs are shared in a supply chain. We consider a system where a manufacturer supplies a single product to a retailer who faces random demand in a competitive market. The retailer incurs a fixed cost per order, inventory holding cost, and a penalty cost for a stockout (unsatisfied demand is back‐ordered). Further, the manufacturer incurs a penalty cost when there is a stockout at the retailer and a fixed replenishment cost. We assume that the players are rational and act noncooperatively. We compare the performance of retailer managed inventory systems, where the retailer places orders and makes replenishment decisions, with vendor managed inventory systems, wherein the vendor or manufacturer makes inventory and replenishment decisions. Specifically, in the vendor managed inventory system, we propose and evaluate holding cost subsidy‐type contracts on inventories offered by the retailer to improve system performance. We evaluate this contract in the context of three widely used inventory systems—deterministic economic order quantity, continuous review (Q, r) policies, and periodic review policies—and show when such contracts may improve channel performance.     

Ageing Population: Identifying the Determinants of Ageing in the Least Developed Countries

Population Research and Policy Review - The issue of population ageing is no longer exclusively centred on developed countries. Empirical studies have proven that the rise in the proportion of the...     

Individualism/Collectivism Orientations and Reactions Toward Alternative Human Resource Management Practices

In this study, we examined the relationship between individualism collectivism orientations of potential job seekers and their reactions toward alternative human resource management (HRM) practices in the areas of selection, performance appraisal, reward system, career system, and employment security. Using several subdimensions of individualism collectivism, we found many significant relationships between individualism collectivism orientations and preferences for alternative human resource management practices that might affect the effectiveness of alternative HRM practices.     

Fairness Among Servers When Capacity Decisions Are Endogenous

We look at a simple service system with two servers serving arriving jobs (single class). Our interest is in examining the effect of routing policies on servers when they care about fairness among themselves, and when they can endogenously choose capacities in response to the routing policy. Therefore, we study the two‐server game where the servers’ objective functions have a term explicitly modeling fairness. Moreover, we focus on four commonly seen policies that are from one general class. Theoretical results concerning the existence and uniqueness of the Nash equilibrium are proved for some policies. Further managerial insights are given based on simulation studies on servers’ equilibrium/off‐equilibrium behaviors and the resulting system efficiency performance under different policies.     

Analytic evaluation of the expectation and variance of different performance measures of a schedule on a single machine under processing time variability

In this paper, we present closed-form expressions, wherever possible, or devise algorithms otherwise, to determine the expectation and variance of a given schedule on a single machine. We consider a variety of completion time and due date-based objectives. The randomness in the scheduling process is due to variable processing times with known means and variances of jobs and, in some cases, a known underlying processing time distribution. The results that we present in this paper can enable evaluation of a schedule in terms of both the expectation and variance of a performance measure considered, and thereby, aid in obtaining a stable schedule. Additionally, the expressions and algorithms that are presented, can be incorporated in existing scheduling algorithms in order to determine expectation-variance efficient schedules.     

Operational Impact of Service Innovations in Multi‐Step Service Systems

Service quality is an important attribute that is used to characterize many service systems. In this study, we examine a service system with two consecutive steps that have shared resources. The service process consists of a base service (first step in the process) followed by a second step that adds additional value. We first look at a social surplus maximizing service provider (SP) who decides the optimal service capacity and re‐optimizes in response to changes in the speed of service of the first step due to local innovations. Our main objective is to explore using simple and stylized models, the effect on the service system of local innovations in step 1 that decrease this step's service times. We find that the effect of such innovations can sometimes lead to the worsening of certain critical service quality measures when SPs are monopolists. Next, using a model of competition, we find that this effect continues to hold in settings where SPs compete for arrivals. Our results have interesting consequences for many service systems and may help explain some of the unintended effects of service innovations reported in the literature.