Incentive Contracts in Projects with Unforeseeable Uncertainty

Designing incentive contracts that constructively guide employee efforts is a particularly difficult challenge in novel innovation initiatives, where unforeseen events may occur. Empirical studies have observed a variety of incentive structures in innovation settings: “time and material contracts” (compensation for executing orders), “downside protection” (target‐driven incentives with protection from unexpected risks), and “upside rewards” (additional remuneration for pursuing opportunities). This paper develops a model of incentives in presence of unforeseen events and offers a theoretical prediction of which of the empirically observed incentive structures should be used under which circumstances. The combination of three key influences drives the shape of the best incentive contract. First, the presence of unforeseeable uncertainty, or the occurrence of events that cannot possibly be foreseen at the outset. These may force a change in the project's plan, making pure target setting insufficient. Second, fairness concerns dictate that the employee's expected compensation cannot be shifted downward by unforeseen events, because it would cause demotivation, hostility, and defection. Third, management may not be able to observe the detailed actions of the employee (moral hazard) nor whether a positive or negative unforeseen event has occurred (asymmetric information).     

Crisis Management: Informing a New Leadership Research Agenda

As the business community becomes more complex, crisis events are likely to increase in both prevalence and severity. Whether management scholarship has kept pace with this new reality is debatable. Moreover, much of the existing crisis research—perhaps understandably—stems from a negative frame: crises are threats or problems to be overcome. Such research has produced relevant insight into crisis handling, has helped categorize the plethora of crisis events, and has connected crisis events to relevant management strategies. We argue here that this framing fundamentally limits the types of questions asked and the methodological approaches used to answer those questions. Perhaps worse, given the important role that leadership plays in crisis handling, this negative frame can hinder the possibilities for the practice and study of leadership. In this article, we review an array of crisis research and explore two theoretical domains—issue framing and deviance—and their potential role for influencing leadership theory. We discuss the challenges of conducting crisis research, and offer suggestions for new methodological approaches and new research questions that are consistent with a more positive leadership approach.     

Risk assessment for handling hazardous substances within the European industry: Available methodologies and research streams

After the Seveso disaster occurred more than 40 years ago, there has been an increasing awareness of the potential impacts that similar accident events can occur in a wide range of process establishments, where the handling and production of hazardous substances pose a real threat to society and the environment. In these industrial sites denominated “Seveso sites,” the urgent need for an effective strategy emerged markedly to handle hazardous activities and to ensure safe conditions. Since then, the main challenging research issues have focused on how to prevent such accident events and how to mitigate their consequences leading to the development of many risk assessment methodologies. In recent years, researchers and practitioners have tried to provide useful overviews of the existing risk assessment methodologies proposing several reviews. However, these reviews are not exhaustive because they are either dated or focus only on one specific topic (e.g., liquefied natural gas, domino effect, etc.). This work aims to overcome the limitations of the current reviews by providing an up-to-date and comprehensive overview of the risk assessment methodologies for handling hazardous substances within the European industry. In particular, we have focused on the current techniques for hazards and accident scenarios identification, as well as probability and consequence analyses for both onshore and offshore installations. Thus, we have identified the research streams that have characterized the activities of researchers and practitioners over the years, and we have then presented and discussed the different risk assessment methodologies available concerning the research stream that they belong to.     

A REVIEW OF THE KANBAN PRODUCTION CONTROL RESEARCH LITERATURE

Station interdependence, blocking caused by finite buffer capacities, and periodic material handling make modeling and analysis of kanban-controlled lines challenging. Also, one must consider flows of material as well as flows of kanbans. The many models given in the literature contribute to the confusion and debate that often characterize kanban research. The only element common to all kanban systems appears to be finite buffer capacities. I describe blocking by total queue size, blocking by part type, and the single-card and twocard systems. I review the kanban literature and organize it by type of system and decision area. First, I discuss elements of system design, including setting kanban numbers, performance measures, material-handling frequencies, and container sizes. Then I cover the production control topics of sequencing and batch-sizing. I conclude with a comparison of kanban and conventional methods of production control and with suggestions for future research.     

Human resource development (HRD) resilience: a new ‘success element’ of organizational resilience?

ABSTRACT

Endlessly changing business and economic landscapes urge organizations to become resilient to ensure business survival and growth. Yet, in many cases, business world is becoming turbulent faster than organizations are becoming resilient. Relevant research indicates the ways through which organizations could respond to unforeseen events, mainly through suggesting that individual and group resilience could lead to an organizational one. However, research is nascent on how particularly human resource development (HRD) resilience could be built, and thus to contribute to organizational resilience as well. Within today’s business uncertainty and complexity, HRD resilience comes in line with the developmental strategies of organizations. Therefore, the purpose of this perspective article is to set the foundations of the term (HRD resilience) in order to initiate a dialogue around its ability to make a substantial contribution to organizational practice, and thus to be seen as a new ‘success element’ of organizational resilience.     

Exploring the use of QPID: A collaborative study of B2B in the automotive industry

Deep and grounded understanding of complex socio-technical phenomena, such as business-to-business (B2B) information systems, requires a collaborative process of enquiry where the researcher works with practitioners to make sense and establish meaning. This suggests the need for interventionary approaches, such as action research and action case, supported by a method of notation for describing a co-constructed reality to make sense of inter-organizational settings and to undertake cross-case comparisons. This paper tests the conjecture that systems thinking and the qualitative politicized influence diagram (QPID) are an appropriate lens through which to study B2B information systems. It demonstrates how the QPID workshop is valuable in inter-organizational studies as a practical and appropriate method of collaborative investigation. The paper concludes by raising issues for research methodology in terms of limitations of the research method, recommendations for further development, and future plans for incorporating multiple partners in industry-level research.     

Violence in the nursing profession: Occupational and lifestyle risk factors in Swedish nurses

In a national study of the work environment, physical, and mental well-being of more than 2600 Swedish nurses, 30% reported having experienced violence at work. Possible association between violence and a range of occupational, demographic, and lifestyle characteristics were studied. Stepwise multiple linear and logistic regressions were used to further examine risk factors for violence. Occupational factors with significant correlations to workplace violence were nursing discipline (type of ward or facility), years of work experience, supervisory responsibilities, night work, work dissatisfaction, work-related musculoskeletal injury, and frequency of patient handling. Demographic/lifestyle factors related to violence were age, gender, smoking, coffee consumption at work, and use of alcohol to relax after work. The best fit linear regression model explained 17% of the variance in violence, 13%, of the variance in threat of violence. The logistic regression model confirmed an increased risk of violence and threats in psychiatric and geriatric settings. However, much remains unexplained about the aetiology of violencc in health carc settings. This report provides the basis for a pilot intervention study currently in progress.     

Supply chain configuration conundrum: how does the pharmaceutical industry mitigate disturbance factors?

How a supply chain (SC) is configured can have a significant impact on the performance of global firms. More specifically, disturbance factors (i.e. those factors associated with uncertainty and risk) are increasingly important considerations. This paper focuses on endogenous, exogenous and environment-related SC disturbance factors and their relative importance when configuring global SCs. Three alternative scenarios of SC configurations for European-based pharmaceutical firms are identified – insource nearshore, outsource nearshore and outsource offshore. Through a multi-phase, mixed-methods approach we find that the top five disturbance factors managers should be aware of while configuring their SCs are quality defects, unforeseen and random interruptions in manufacturing processes, order processing difficulties, untimely delivery of products and a mismatch between market demand and supplier responsiveness. This study is able to provide insights into the impact of disturbance factors on the SC configuration strategy for Big Pharmas (BPs). We show that SC disturbances influenced the decision to bring production back home (reshoring) or to a closer location (nearshoring). To mitigate the effects of disturbances many BPs recalibrated their SC configurations by insourcing core products, outsourcing non-core products offshore and developing offshore insourcing capabilities through ‘captives’.     

Violence in the nursing profession: Occupational and lifestyle risk factors in Swedish nurses

Abstract

In a national study of the work environment, physical, and mental well-being of more than 2600 Swedish nurses, 30% reported having experienced violence at work. Possible association between violence and a range of occupational, demographic, and lifestyle characteristics were studied. Stepwise multiple linear and logistic regressions were used to further examine risk factors for violence. Occupational factors with significant correlations to workplace violence were nursing discipline (type of ward or facility), years of work experience, supervisory responsibilities, night work, work dissatisfaction, work-related musculoskeletal injury, and frequency of patient handling. Demographic/lifestyle factors related to violence were age, gender, smoking, coffee consumption at work, and use of alcohol to relax after work. The best fit linear regression model explained 17% of the variance in violence, 13%, of the variance in threat of violence. The logistic regression model confirmed an increased risk of violence and threats in psychiatric and geriatric settings. However, much remains unexplained about the aetiology of violencc in health carc settings. This report provides the basis for a pilot intervention study currently in progress.     

Simulation Tests of FCFS and SPT Sequencing in Kanban Systems

One of the basic tenets of scheduling theory is that the SPT sequencing rule maximizes average production rates and minimizes average in-process inventories. This paper shows that on single-card kanban-controlled lines FCFS often has greater average production rates than SPT. Further, the performance of SPT declines relative to FCFS for larger queue capacities and less frequent material handling. Results for the single-card system are also compared to those of Berkley and Kiran [1]. In that article it was shown that for two-card systems with periodic material handling, SPT has larger average inventories than FCFS. This paper shows that these surprising results can be attributed to Berkley and Kiran's material-handling mechanism.     

The Call for a Shift from Risk to Resilience: What Does it Mean?

In recent years calls have been made for a shift from risk to resilience. The basic idea is that we need to be prepared when threatening events occur, whether they are anticipated or unforeseen. This article questions the extent to which this call will have and should have implications for the risk field and science. Is the call based on a belief that this field and science should be replaced by resilience analysis and management, or is it more about priorities: Should more weight be placed on improving resilience? The article argues that the only meaningful interpretation of the call is the latter. Resilience analysis and management is today an integrated part of the risk field and science, and risk analysis in a broad sense is needed to increase relevant knowledge, develop adequate policies, and make the right decisions, balancing different concerns and using our limited resources in an effective way.     

Capacity Sharing and Cost Allocation among Independent Firms with Congestion

We analyze the benefit of production/service capacity sharing for a set of independent firms. Firms have the choice of either operating their own production/service facilities or investing in a facility that is shared. Facilities are modeled as queueing systems with finite service rates. Firms decide on capacity levels (the service rate) to minimize delay costs and capacity investment costs possibly subject to service‐level constraints on delay. If firms decide to operate a shared facility they must also decide on a scheme for sharing the capacity cost. We formulate the problem as a cooperative game and identify settings under which capacity sharing is beneficial and there is a cost allocation that is in the core under either the first‐come, first‐served policy or an optimal priority policy. We show that capacity sharing may not be beneficial in settings where firms have heterogeneous work contents and service variabilities. In such cases, we specify conditions under which capacity sharing may still be beneficial for a subset of the firms.     

The impact of random machine unavailability on inventory policies in a continuous improvement environment

There are production situations where a production facility (e.g. a machine) is used intermittently to produce lot sizes of certain products. Upon completion of production run, the facility may not be available for a random amount of time due to several reasons, such as: the facility needs to be maintained and the maintenance time is random due to unforeseen circumstances; or that the facility is leased by different manufacturers and the demand for the facility is random. As a result of machine unavailability, stock-out situations might arise. This paper extends the work of Abboud et al . (2000, Computers and Operations Research , 27 , 335-351) by assuming learning and forgetting in production. A new mathematical model is developed with numerical examples and sensitivity analysis provided. Furthermore, this paper determines how the overall inventory cost is influenced by the nature of the random variable that represents the unavailability time of the production facility.     

Quantifying the Economic Impact of Hydraulic Fracturing Proppant Selection in Light of Occupational Exposure Risk and Functional Requirements

Selection of an effective and economic proppant material for hydraulic fracturing is an important design choice to optimize the production of oil and natural gas. Proppants are made of silica (quartz sand), alumina, resin-coated silica, ceramics, and others. These materials can be toxic to varying degrees and lead to health problems in the employees handling them primarily due to inhalation exposure. Proppants are selected based on grain size, shape, strength, and cost. Current use is dominated by crystalline silica—the proppant that also has the greatest hazard as an inhalation toxin. Existing research describes the effect of silica on human health, but little research has been done to determine the risk-reduction and social-cost-effectiveness associated with using alternative proppants in light of the health risks. This study quantifies the relative risks or benefits to human health by the use of these proppants through an economic analysis considering the health-related economic impact and its technical attributes. Results show that the use of each ton of silica proppant results in $123 of external costs from fatalities and nonfatal illness arising due to exposure to silica for a crew handing 60,000 tons of proppants. If these health-related externalities were incorporated into the cost, silica proppant could be economically replaced by less harmful, more expensive alternatives for hydraulic fracturing crews handling less than 60,000 tons of proppant each year.     

Human Factors Analysis for Maritime Accidents Based on a Dynamic Fuzzy Bayesian Network

Human factors are widely regarded to be highly contributing factors to maritime accident prevention system failures. The conventional methods for human factor assessment, especially quantitative techniques, such as fault trees and bow-ties, are static and cannot deal with models with uncertainty, which limits their application to human factors risk analysis. To alleviate these drawbacks, in the present study, a new human factor analysis framework called multidimensional analysis model of accident causes (MAMAC) is introduced. MAMAC combines the human factors analysis and classification system and business process management. In addition, intuitionistic fuzzy set theory and Bayesian Network are integrated into MAMAC to form a comprehensive dynamic human factors analysis model characterized by flexibility and uncertainty handling. The proposed model is tested on maritime accident scenarios from a sand carrier accident database in China to investigate the human factors involved, and the top 10 most highly contributing primary events associated with the human factors leading to sand carrier accidents are identified. According to the results of this study, direct human factors, classified as unsafe acts, are not a focus for maritime investigators and scholars. Meanwhile, unsafe preconditions and unsafe supervision are listed as the top two considerations for human factors analysis, especially for supervision failures of shipping companies and ship owners. Moreover, potential safety countermeasures for the most highly contributing human factors are proposed in this article. Finally, an application of the proposed model verifies its advantages in calculating the failure probability of accidents induced by human factors.     

NEW TECHNOLOGY INVESTMENTS IN MULTISTAGE PRODUCTION SYSTEMS

The introduction of new technologies in production and manufacturing (such as robotics, flexible manufacturing systems (FMS), and computer-aided design and manufacturing (CAD/CAM)) frequently motivates capital investment decisions. Traditionally, the need for additional capacity has motivated the evaluation of investment decisions which were undertaken based on financial factors such as the net present value (NPV), internal rate of return, taxation, and depreciation. This research integrates investment decisions with operational decisions for the case of multistage production assembly systems. We show that for such systems investment decisions affect not only the financial structure but also production scheduling and material flow in the system.     

Evaluation of Take‐Home Exposure and Risk Associated with the Handling of Clothing Contaminated with Chrysotile Asbestos

The potential for para‐occupational (or take‐home) exposures from contaminated clothing has been recognized for the past 60 years. To better characterize the take‐home asbestos exposure pathway, a study was performed to measure the relationship between airborne chrysotile concentrations in the workplace, the contamination of work clothing, and take‐home exposures and risks. The study included air sampling during two activities: (1) contamination of work clothing by airborne chrysotile (i.e., loading the clothing), and (2) handling and shaking out of the clothes. The clothes were contaminated at three different target airborne chrysotile concentrations (0–0.1 fibers per cubic centimeter [f/cc], 1–2 f/cc, and 2–4 f/cc; two events each for 31–43 minutes; six events total). Arithmetic mean concentrations for the three target loading levels were 0.01 f/cc, 1.65 f/cc, and 2.84 f/cc (National Institute of Occupational Health and Safety [NIOSH] 7402). Following the loading events, six matched 30‐minute clothes‐handling and shake‐out events were conducted, each including 15 minutes of active handling (15‐minute means; 0.014–0.097 f/cc) and 15 additional minutes of no handling (30‐minute means; 0.006–0.063 f/cc). Percentages of personal clothes‐handling TWAs relative to clothes‐loading TWAs were calculated for event pairs to characterize exposure potential during daily versus weekly clothes‐handling activity. Airborne concentrations for the clothes handler were 0.2–1.4% (eight‐hour TWA or daily ratio) and 0.03–0.27% (40‐hour TWA or weekly ratio) of loading TWAs. Cumulative chrysotile doses for clothes handling at airborne concentrations tested were estimated to be consistent with lifetime cumulative chrysotile doses associated with ambient air exposure (range for take‐home or ambient doses: 0.00044–0.105 f/cc year).     

Production control for just-in-time tool-and-die manufacturing

The strategy to implement production control varies in different types of manufacturing systems. We address the issue of production control in unit-based manufacturing systems where the production batch size of the final product is one or two, the product is custom designed and is made up of numerous individual components with similar process routeings lor special machine tools, turbines, boilers, tool-and-die, injection moulding equipment, custom fabrication, etc. We have developed algorithms to generate master production schedules in this particular domain of manufacturing systems using the concept of workgroups. We show how a Kanban-based JIT shopfloor control and purchasing system can be implemented in such systems in tandem with an inventory management system by utilizing the concept of demand lists. We also propose a model for practical implementation of production control in this domain. The methodology is illustrated at a tool-and-die plant where a CIM software is used to apply the JIT-based production control. Preliminary results show a significant reduction in lead times. We try to show the relationship between research and industrial applications of productions of production control and how to bridge the gap between them.     

Reliability: Its implications in production systems design

Research on production systems design has in recent years tended to concentrate on ‘software’ factors such as organisational aspects, work design, and the planning of the production operations. In contrast, relatively little attention has been paid to maximising the contributions made by fixed assets, particularly machines and equipment. However, as the cost of unproductive machine time has increased, reliability, particularly of machine tools, has become ever more important. Reliability theory and research has traditionally been based in the main on electrical and electronic equipment whereas mechanical devices, especially machine tools, have not received sufficiently objective treatment. A recently completed research project has considered the reliability of machine tools by taking sample surveys of purchasers, maintainers and manufacturers. Breakdown data were also collected from a number of engineering companies and analysed using both manual and computer techniques. Results obtained have provided an indication of those factors most likely to influence reliability and which in turn could lead to improved design and selection of machine tool systems. Statistical analysis of long-term field data has revealed patterns of trends of failure which could help in the design of more meaningful maintenance schemes.     

Organizational Improvisation: What, When, How and Why

In this article, the authors review the growing body of literature on organizational improvisation in order to present an encompassing and systematic perspective on this concept. An integrative definition of its construct is presented together with a new way of measuring this phenomenon in organizational settings. The article further explores this construct by presenting its triggers, necessary conditions, influencing factors and major outcomes. The issues of improvisation's growing legitimization in the organizational arena for practitioners and researchers alike are addressed in order to argue for the need for and interest in a fuller development research on this concept.