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Three essays in operations management

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dc.contributor.advisor Georgia Perakis. en_US Leung, Ngai-Hang Zachary en_US
dc.contributor.other Massachusetts Institute of Technology. Operations Research Center. en_US 2015-01-05T20:07:06Z 2015-01-05T20:07:06Z 2014 en_US 2014 en_US
dc.description Thesis: Ph. D., Massachusetts Institute of Technology, Sloan School of Management, Operations Research Center, 2014. en_US
dc.description Cataloged from PDF version of thesis. en_US
dc.description Includes bibliographical references. en_US
dc.description.abstract The thesis applies optimization theory to three problems in operations management. In the first part of the thesis, we investigate the impact of inventory control on the availability of drugs to patients at public health facilities in Zambia. We present consistent empirical data and simulation results showing that, because of its failure to properly anticipate seasonal variations in demand and supply lead-times, this system leads to predictable patient-level stock-outs even when there is ample inventory available in the central warehouse. Secondly, we propose an alternative inventory control system relying on mobile devices and mathematical optimization, and present results from a validated simulation model suggesting that its implementation would lead to a substantial improvement of patient access to drugs relative to the current system. In the second part of the thesis, we investigate the impact of returning customers on pricing for fashion Internet retailers. Our analysis of clickstream data from an online fashion retailer shows that a significant proportion of sales is due to returning customers, i.e. customers who first visit an item at a particular price, but purchase the item in a later visit at a lower price. We propose a markdown pricing model that explicitly incorporates returning customers. We propose a model for quantifying the value of the returning pricing model relative to a pricing model that does not distinguish between first-time and returning customers, and determine the value of returning pricing both exactly and through developing bounds. Based on real data from a fashion Internet retailer, we estimate the parameters of the returning demand model and determine the value of the returning pricing model. Lastly, we study the promotion optimization problem faced by grocery retailers, i.e. deciding which items to promote and at what price. Our formulation includes several business rules that arise in practice. We build demand models from data in order to capture the stockpiling behavior through dependence on past prices. This gives rise to a hard problem. For general additive and multiplicative demand structures, we propose efficient LP based methods, show theoretical performance guarantees and validate our results using real data. en_US
dc.description.statementofresponsibility by Ngai-Hang Zachary Leung. en_US
dc.format.extent 224 pages en_US
dc.language.iso eng en_US
dc.publisher Massachusetts Institute of Technology en_US
dc.rights M.I.T. theses are protected by copyright. They may be viewed from this source for any purpose, but reproduction or distribution in any format is prohibited without written permission. See provided URL for inquiries about permission. en_US
dc.rights.uri en_US
dc.subject Operations Research Center. en_US
dc.title Three essays in operations management en_US
dc.type Thesis en_US Ph. D. en_US
dc.contributor.department Massachusetts Institute of Technology. Operations Research Center. en_US
dc.identifier.oclc 898332895 en_US

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