Surge pricing on a service platform under spatial spillovers: evidence from Uber

Ride-sharing platforms employ surge pricing to match anticipated capacity spillover with demand. We develop an optimization model to characterize the relationship between surge price and spillover. We test predicted relationships using a spatial panel model on a dataset from Ubers operation. Results reveal that Ubers pricing accounts for both capacity and price spillover. There is a debate in the management community on the ecacy of labor welfare mechanisms associated with shared capacity. We conduct counterfactual analysis to provide guidance in regards to the debate, for managing congestion, while accounting for consumer and labor welfare through this online platform.First author draf

Technology Readiness Levels at 40: a study of state-of-the-art use, challenges, and opportunities

The technology readiness level (TRL) scale was introduced by NASA in the 1970s as a tool for assessing the maturity of technologies during complex system development. TRL data have been used to make multi-million dollar technology management decisions in programs such as NASA's Mars Curiosity Rover. This scale is now a de facto standard used for technology assessment and oversight in many industries, from power systems to consumer electronics. Low TRLs have been associated with significantly reduced timeliness and increased costs across a portfolio of US Department of Defense programs. However, anecdotal evidence raises concerns about many of the practices related to TRLs. We study TRL implementations based on semi-structured interviews with employees from seven different organizations and examine documentation collected from industry standards and organizational guidelines related to technology development and demonstration. Our findings consist of 15 challenges observed in TRL implementations that fall into three different categories: system complexity, planning and review, and validity of assessment. We explore research opportunities for these challenges and posit that addressing these opportunities, either singly or in groups, could improve decision processes and performance outcomes in complex engineering projects

Digitalisation of Development and Supply Networks: Sequential and Platform-Driven Innovations

We draw from an eight-year dataset of 98 organisational entities involved in pre-competitive innovation networks across the UK pharmaceutical sector. These data map into three networks that are representative of: (i) a product development-led sequential pathway that begins with digitalised product development, followed by digitalisation of supply networks, (ii) a supply network-led sequential pathway that starts with digitalised supply networks, followed by digitalisation of product development, and (iii) a parallel — platform-driven — pathway that enables simultaneous digitalisation of development, production, and supply networks. We draw upon extant literature to assess these network structures along three dimensions — strategic intent, the integrative roles of nodes with high centrality, and innovation performance. We conduct within-case and cross-case analyses to postulate 10 research propositions that compare and contrast modalities for sequential and platform-based digitalisation involving collaborative innovation networks. With sequential development, our propositions are congruent with conventional pathways for mitigating innovation risks through modular moves. On the other hand, we posit that platform-based design rules, rather than modular moves, mitigate the risks for parallel development pathways, and lead to novel development and delivery mechanisms

Pushing the Frontier of Sustainable Service Operations Management: Evidence from US hospitality industry

Purpose: The purpose of this study is to develop a performance measurement system of environmental sustainability in service settings and to empirically examine the relationship between the measured environmental sustainability and operating performance. Design/methodology/approach: This study applies exploratory factor analysis (EFA) to a six-year panel dataset of 984 US hotels to construct a two-factor standardized measure of environmental sustainability. The authors then conduct a stochastic frontier analysis (SFA) to investigate the relationship between the measured environmental sustainability and the operating performance frontier, considering the impact of operating structure. Findings: Customer behavior and operational decisions are two key drivers of environmental sustainability. There is a positive link between environmental sustainability and operating performance. Operating structure has a significant impact on the operating performance. The performance frontier varies across market segment and location characteristics such as degree of urbanization and climate condition. Practical implications: The findings indicate that service providers should actively involve customers, and manage both front-office and back-office operations in environmental sustainability initiatives. Operating structures that favor the alignment of multiple service supply chain partners’ interests contribute positively to performance. The managers should be mindful of varying best-in-class performance due to operating unit characteristics such as market segment, and location characteristics. Originality/value: This study is among the first attempts to develop a performance measurement system of environmental sustainability. The resulted standardized measure of environmental sustainability considers both the revenue and cost impacts in service operations. This research is among the first generation of papers that bring the unique characteristics of service operations, particularly service co-production, into sustainability research

Signaling Eco-Certification: Implications for Service Coproduction and Resource Efficiency

Purpose – The purpose of this paper is to use an eco-friendly service concept framework to demonstrate the effect of credible eco-certification signaling. Design/methodology/approach – The authors examine a cross-sectional data set consisting of 2,481 hotel sites across the US. The authors measure the performance of the operations component of eco-friendly service by operations-driven resource efficiency (ODF), and the performance of the marketing component by customer-driven resource efficiency (CDF). A series of multivariate regressions compare these two resource efficiency measures between credibly eco-certified hotel sites and others. Findings – The results indicate that credible eco-certifications achieve the signaling effect. Eco-certified hotels outperform others in both ODF and CDF measures; and eco-certified hotels still achieve higher CDF after controlling for ODF. Practical implications – The findings suggest that eco-friendly service design requires not only eco-friendly operations but also a built-in credible signaling mechanism. This mechanism engages the customers in eco-friendly service coproduction and in doing so integrates the operations and marketing components of eco-friendly service strategy through eco-certifications. Originality/value – This study is among the first to demonstrate empirically the signaling effect of credible eco-certifications in services. It increases understanding of eco-friendly service design and delivery by exploring the role of credible eco-certifications in linking customer benefits with the service organization’s strategic intent

Are More Frequent Releases Always Better? Dynamics of Pivoting, Scaling, and the Minimum Viable Product

Using the system dynamics methodology, we model the minimum viable product (MVP) approach to product development and examine the impact of release frequency, planning practices and committed reengineering capacity on software development outcomes. We leverage the organizational learning, Lean Startup, and Agile methodology literature to form the underpinnings of the model and measure outcomes using cumulative market cost of failing to meet market wants and cumulative engineering cost. While shorter release cycles are better in general for achieving market fit, the relationship is moderated by planning delays and committed reengineering capacity. We show that reducing the extent of pivot in each iteration may be better for firms. Firms instead should iterate moderately and not radically during any particular release. Counter intuitively, planning delays are beneficial by reducing overreaction to spurious market signals. Finally, we discuss implications of our findings for future research on learning and planning amongst entrepreneurial firms

Exploring Resource Efficiency Benchmarks for Environmental Sustainability

Successful environmental sustainability (ES) initiatives aim for simultaneous environmental and economic benefits. Benchmarking these initiatives must therefore account for environmental and economic outcomes. To this end, the authors propose to construct a cost-based resource efficiency measure for ES from reported financial data. This approach links the environmental and economic performance outcomes by extracting information from resource related expenses normalized by RevPAR (revenue per available room). Through exploratory factor analysis of an eight-year panel of 984 U.S. hotels, the authors identified t w o factors that drive resource efficiency in hotel operations, one of which is operations-centered and the other customer behavior-centered. This two-factor measure quantifies the weights that operations and customer behavior contribute to resource efficiency and measures the systematic variations across key hotel operating characteristics. Such resource efficiency benchmarks complement the practice-focused environmental management systems developed by individual hotel companies and guidelines proposed by government agencies such as the U.S. Environmental Protection Agency

Eco-efficiency of Service Co-production: Connecting Eco-certifications and Resource Efficiency in U.S. Hotels

This study investigates the relationship between eco-certifications (second or third party certified with an audit requirement) and resource efficiency in the U.S. hotel industry. Hotel properties become eco-certified by voluntarily conforming to environmental practice guidelines established by a certifying body, which assesses and recognizes the properties that meet their criteria. Eco-certifications therefore are key environmental sustainability initiatives that address both the internal operations and external customers. Based on regression analysis of 2,893 U.S. hotel properties for the year 2011, this analysis shows that eco-certified hotels maintain higher operational efficiency, as well as greater customer-driven resource efficiency, in comparison with properties with lesser or no eco-certifications. These results suggest that eco-certifications influence the resource consumption behavior of both the operators and the customers, although these effects are not consistent for all properties. The improvement from the operational effect is most pronounced in lower-tier properties, while the customer efficiency effect is most noticeable in upper-tier properties

Developments in Practice V: IT Sourcing: Build, Buy, or Market

This paper describes the logical evolution of IT service provisioning through various delivery models over time concentrating on the rent era as well as the market era - an emerging external IT services marketplace that offers rich opportunities for IT organizations to become more cost-effective in the future. With the market era, IT organizations speculate that strategic business applications for mission-critical applications will remain in-house but delivery for standard and meta-industry applications, processes, and technology will be off-site. Thus, for most companies, it is likely that external IT providers will form part of their future service delivery package and that some IT departments will become both consumers and sellers of components. The implications of these developments for IT management are articulated and the elements of an IT sourcing strategy presented

Improving the Systems Engineering Process with Multilevel Analysis of Interactions

The systems engineering V (SE-V) is an established process model to guide the development of complex engineering projects (INCOSE, 2011). The SE-V process involves decomposition and integration of system elements through a sequence of tasks that produce both a system design and its testing specifications, followed by successive levels of build, integration, and test activities. This paper presents a method to improve SE-V implementation by mapping multilevel data into design structure matrix (DSM) models. DSM is a representation methodology for identifying interactions either between components or tasks associated with a complex engineering project (Eppinger & Browning, 2012). Multilevel refers to SE-V data on complex interactions that are germane either at multiple levels of analysis, e.g. component versus subsystem conducted either within a single phase or across multiple time phases, e.g. early or late in the SE-V process. This method extends conventional DSM representation schema by incorporating multilevel test coverage data as vectors into the off diagonal cells. These vectors provide a richer description of potential interactions between product architecture and SE-V integration test tasks than conventional domain mapping matrices (DMMs). We illustrate this method with data from a complex engineering project in the offshore oil industry. Data analysis identifies potential for unanticipated outcomes based on incomplete coverage of SE-V interactions during integration tests. Additionally, assessment of multilevel features using maximum and minimum function queries isolates all the interfaces that are associated with either early or late revelations of integration risks based on the planned suite of SE-V integration tests