bluuebunny/crossref_metadata_2025 huggingface dataset:
AN OPERATIONAL APPROACH TO THE EVALUATION OF LEASES BY HOSPITALS*
Authors: Ofer Aharon R.
Published: June 2007

The evaluation of the lease versus purchase alternative by not‐for‐profit hospitals presents a problem that stems from the interaction between investment and financial decisions. This paper provides an analytical framework that resolves this issue by neutralizing the impact of the lease contract on the hospital's financial structure and debt capacity. The formulation incorporates the special operating characteristics of not‐for‐profit hospitals: namely, they are not subject to federal income tax, and part of their revenue is generated through cost‐based reimbursement.
A COMPARISON OF DECISION QUALITY UNDER NOMINAL AND INTERACTING CONSENSUS GROUP FORMATS: THE CASE OF THE STRUCTURED PROBLEM*
Authors: Herbert Theodore T. , Yost Edward B.
Published: June 2007

The applicability of the Nominal Grouping Technique (NGT) to a structured problem was investigated. NGT and interacting consensus groups were compared on the criteria of decision quality, utilization of best resource, and improvement in quality over average‐member decision quality. Nominal groups' decisions were significantly (p = .005) better than those of interacting groups on all three criteria. Problems with criteria assessment in unstructured tasks were discussed, as were the implications of the present study for prescriptions for NGT use.
AN ANALYSIS OF THE USEFULNESS OF DISAGGREGATED ACCOUNTING DATA FOR FORECASTS OF CORPORATE PERFORMANCE*
Authors: Barnea Amir , Lakonishok Joseph
Published: June 2007

The purpose of this paper is to derive the conditions under which disaggregated accounting data contribute to more accurate forecasts of corporate performance. A comparison formula is derived and applied to actual data. The results obtained indicate that disaggregated data do not necessarily produce better forecasts of corporate performance than do aggregated data. The paper concludes with implications of the results to some reporting issues.
A BAYESIAN APPROACH TO PLANT‐LOCATION DECISIONS*
Authors: Carroll Thomas M. , Dean Robert D.
Published: June 2007

The paper addresses the problem of plant location in the formal context of decision making under uncertainty and presents a framework employing Bayesian analysis in the collection and assessment of information. As a general model, the Bayesian approach is shown to subsume two practical approaches common to plant‐location literature: satisficing and spatial hierarchy of plant‐site characteristics.
HEURISTIC ALGORITHMS FOR CAPITAL‐BUDGETING DECISIONS IN MULTIDIVISION FIRMS
Authors: Rosenblatt Meir J. , Freeland James R.
Published: June 2007

This paper presents two versions of a heuristic algorithm to solve a model of the capital‐budgeting problem in a decentralized multidivision firm involving no more than two exchanges of information between headquarters and divisions. Headquarters makes an allocation of funds to each division based upon its cash demand and its potential growth rate. Each division determines which projects to accept. Then, an additional iteration is performed to define the solution. More than one thousand examples were simulated resulting in an average relative error of less than one percent.
QUANTITATIVE MEASURES FOR CHARACTERISTICS OF A STATE‐DEPENDENT ASSIGNMENT POLICY
Authors: Halpern Jonathan , Wand Yair
Published: June 2007

The paper presents an analytical description of a state‐dependent assignment policy, where different assignments of attributes to objects are employed under different states. Various considerations, other than optimizing an objective function, present themselves for such cases—for example, the existence of groups of assignees with certain levels of intragroup assignment uniformity, the stability of the policy over states, the presence of a revealed preference ordering of the assignments, and others. An approach towards a quantitative treatment of such features of a state‐dependent assignment policy is discussed, and in particular a uniformity measure is defined and its properties are investigated. Potential uses of the model are suggested for urban emergency services, questionnaire analysis, task allocation, medical diagnosis, and dynamic computer program behavior. Three implementations for questionnaire analysis are reported.
DISTRIBUTIONAL TESTING OF DATA FROM MANUFACTURING PROCESSES
Authors: Jacobs Fredric , Lorek Kenneth S.
Published: June 2007

A common characteristic of classical variance investigation models includes the assumptions that the in‐control cost observations from manufacturing processes are independently and normally distributed. The purpose of this paper is to empirically assess the appropriateness of the above assumptions in an accounting setting. Several sets of data generated from manufacturing processes were examined, with the following results. First, normality and independence assumptions appeared to be violated with the daily data. In addition, several transformations commonly employed in the statistics literature did not alter this conclusion. Second, the above assumptions were not violated with the weekly data. It was then demonstrated that these findings will, in general, hold.

These results, subject to the inherent limitations of a case study approach, led to the following inferences and recommendations. Using classical statistical techniques and daily data to control a process incurs costs that have been previously overlooked, costs resulting from distributional assumption violations. If these costs exceed the benefits of using daily data, a manager should (1) use classical techniques to monitor weekly data, (2) use Tchebycheff inequalities to monitor daily data, and/or (3) use variance investigation models that more formally incorporate the serial dependencies of daily data.
GOAL PROGRAMMING IN A FUZZY ENVIRONMENT
Authors: Narasimhan Ram
Published: June 2007

This paper illustrates the application of “fuzzy subsets” concepts to goal programming in a fuzzy environment. In contrast to a typical goal‐programming problem, the goals are stated imprecisely when the decision environment is fuzzy. The paper first considers a fuzzy goal‐programming problem with multiple goals having equal weights associated with them. A solution approach based on linear programming is developed. Next, the solution approach is extended to the case where unequal fuzzy weights are associated with multiple goals. Numerical examples are provided for both cases to illustrate the solution procedure.
A STOCHASTIC MULTIATTRIBUTE HEURISTIC MODEL OF INVESTOR CHOICE
Authors: Bernardo John J. , Upton David E.
Published: June 2007

Most models of investor behavior consider only two attributes of assets, risk and return, and are deterministic in that only one unique choice is allowed. This paper develops a multiattribute model in which investor choice is described in terms of the probability of various choices occurring. The model is solved by standard linear programming techniques and allows for investor behavior that is not explained by the usual models.
AN INFORMATION PROCESSING PROBE INTO CONJOINT ANALYSIS*
Authors: Olshavsky Richard W. , Acito Franklin
Published: June 2007

Protocol analysis was used to identify the actual choice rule used by respondents in a conjoint analysis interview under two different card‐sorting instruction conditions. In both conditions respondents used a noncompensatory rule (conjunctive or lexicographic) andnot the additiverule assumed in many conjoint analysis studies. Predictions based upon either the additive rule or the noncompensatory rule were, however, found to be consistent with preference ranks in a holdout sample. The protocols were further analyzed to provide partial validation of the conjoint weights and to investigate the nature of prediction errors observed in the conjoint analysis.
FUTURE DIRECTIONS FOR DEVELOPING DECISION SUPPORT SYSTEMS*
Authors: Bonczek Robert H. , Holsapple Clyde W. , Whinston Andrew B.
Published: June 2007

A formal, generic description of decision support systems is introduced. This description views a decision support system as having three principal components: a language system, a knowledge system, and a problem processing system. Several systems that fit the generic decision support system idea, but are (for the most part) not the customary kinds of systems encountered in business applications, are described. The concepts and techniques employed in these systems can make important contributions to the emergence of more powerful business‐oriented decision support systems.
COST‐VOLUME‐PROFIT ANALYSIS IN STOCHASTIC PROGRAMMING MODELS
Authors: Chen Joyce T.
Published: June 2007

This paper applies mathematical programming to cost‐volume‐profit (CVP) analysis under contribution margin uncertainty. Three CVP probabilistic chance‐constraint models based on various safety‐first criteria for decisions under uncertainty are presented and compared. It is shown that a break‐even segment of the mean‐standard deviation frontier is a set of optimal solutions for the proposed models. An operational parametric quadratic programming (QP) model is constructed, and the efficiency frontier is generated. The procedures for locating an optimal solution on the efficiency frontier are then presented. The recommended QP procedure offers both technical relief from the computational difficulties posed by the probabilistic constraints and a desired flexibility in generating and presenting the relevant information for decisions under uncertainty.
SOME CAUTIONARY NOTES ON THE USE OF CONJOINT MEASUREMENT FOR HUMAN JUDGMENT MODELING*
Authors: Messier William F. , Emery Douglas R.
Published: June 2007

Conjoint measurement has been suggested as a methodology that might be useful in assisting research concerned with the identification of the structural form of a judge's model. This paper synthesizes the results of some recent research that examined the robustness of this methodology. This research suggests that conjoint measurement has three major weaknesses: (1) certain biases exist when diagnosing model structure, (2) model diagnosis is limited to a small set of potential models, and (3) error substantially compromises conjoint measurement's ability to diagnose model structure. An empirical example that demonstrates some of the difficulties of using this methodology with experimental data is also presented.
ACCOUNTING SYSTEMS: THE RELIABILITY APPROACH TO INTERNAL CONTROL EVALUATION
Authors: Stratton William O.
Published: June 2007

Recent developments have increased the value to management of objective methodologies for the evaluation of accounting internal control systems (AICS). The Foreign Corrupt Practices Act requires management to assure the accuracy of these systems. The process of evaluation of AICS by both management and external auditors is judgmental in nature. The few attempts at modeling AICS have not been implemented by firms due to the lack of realism, difficulty of modeling behavioral systems, lack of cost effectiveness, and lack of understanding by practitioners. For these reasons, the role of the decision scientist has been limited.

The research reported here attempts to demonstrate feasibility of a reliability model. A typical accounting system for raw material purchases is modeled via a simulation routine. The effects of internal control weaknesses on ending dollar balances is determined by performing sensitivity analysis. After summarizing these effects, the reliability model is formulated for the same control system, and the analysis is repeated and the results compared with those obtained in a simulation model.
THE ACADEMIC FLOW MODEL: A MARKOV‐CHAIN MODEL FOR FACULTY PLANNING*
Authors: Bleau Barbara Lee
Published: June 2007

A Markov‐chain faculty planning model to be used with institution‐specific data is presented to describe and better understand the complex phenomena of faculty movement through an institution and on its relationship to salary costs, composition of the faculty, and faculty turnover rate. The model updates the earlier work done at Stanford University and Oregon State University by the addition of states for fixed‐term appointments and for part‐time FTEs to reflect accurately the current hiring trends at many institutions. The model is implemented and tested at two different institutions. The findings suggest that the model is a viable means of gaining useful insights and quantitative data on the faculty profile, salary costs, expected departures, and part‐time trends. And further, when used as a planning tool, and the model apparently is comprehensive and flexible enough to analyze the probable effects, both in the short and long run, of alternative personnel policies on the faculty composition.
State of the Art*
Authors: Cummings L. L.
Published: June 2007

This is a conceptual, prescriptive article analyzing current trends and suggesting a redirection necessary for the advancement of organizational behavior. Two divergent but possible complementary approaches—the conservative and the radical—are outlined as accomplishing such a redirection in the field. The conservative approach emphasizes four needs requiring attention: 1) improved construct validity; 2) more careful selection and measurement of dependent variables, including a change in those deemed important; 3) new applications of longitudinal and experimental research designs; and 4) an increased and more appropriate use of multivariate statistical analysis. The radical approach encompasses conceptualizing organizations as social structures, the symbolic nature of management as a process, and a focus on processes across levels of analysis. It is predicted that, regardless of whether one views the future in the field as being indicative of the conservative or a more radical approach, we will see the roles of contexts and processes in research and application as being influential.
ON FUZZY GOAL PROGRAMMING*
Authors: Hannan Edward L.
Published: June 2007

This paper illustrates how the goal programming problem with fuzzy goals having linear membership functions may be formulated as a single goal programming problem. Also, a previously defined method for dealing with fuzzy weights for each of the goals is re‐examined.
PRODUCTION/OPERATIONS MANAGEMENT: PURE PREDICTIONS FOR THE '80s1
Authors: Fryer John S.
Published: June 2007

The future of production/operations management is examined. Following a lead‐in designed to grab your attention and to demonstrate the relation between production/operations management and health care, 14 specific and irrefutable pure predictions are presented. Briefly, they are 1,2, and 3, followed by 4 through 12, and closing with 14 and 15.
A LOGIT‐MARKOVIAN MODEL OF CONSUMER PURCHASE BEHAVIOR BASED ON EXPLANATORY VARIABLES: EMPIRICAL EVALUATION AND IMPLICATIONS FOR DECISION MAKING*
Authors: Zufryden Fred S.
Published: June 2007

This study describes and empirically evaluates an approach to modeling purchase behavior that integrates a Logit‐Markov‐based multivariate brand‐choice model structure with stochastic components. Using actual market data for a frequently purchased consumer product obtained from a consumer purchase panel survey, the paper highlights some marketing applications of the model. Given its general structure, the model can aid marketing managers in defining and evaluating target market segments and in assessing the impact of alternative marketing strategies.
MANAGING THE DECISION SCIENCE TECHNOLOGY: A CASE FOR ETHICAL ANALYSIS?*
Authors: Brightman Harvey J.
Published: June 2007

After ten years of rapid, if sometimes chaotic growth, it is time to reflect upon where Decision Sciences is headed. At stake are the essential questions of (1) should the growth of the discipline be managed, and if so (2) how should it be managed and who should do the managing? I argue that the growth of the discipline should be managed rather than be dictated by the technological imperative that states that any envisioned application of quantitative methods should be implemented. Moreover, I argue that, since to a large degree the implementation decision is an ethical question, the individual decision scientist must ultimately be held accountable. Finally, I suggest that Glenn Stassen's social ethic paradigm may be a useful vehicle for resolving intradiscipline conflicts. These abstract ideas are concretized by examining the growth of the area of artificial intelligence.
A NOTE ON THE USE OF SELECTED NONFINANCIAL RATIO VARIABLES TO PREDICT SMALL‐BUSINESS LOAN PERFORMANCE*
Authors: Cowen Scott S. , Page Albert L.
Published: June 2007

Small business loan applications have not been evaluated successfully by traditional methods. This paper explores the possibility of using three types of nonfinancial ratio variables (owner, firm, and loan characteristics) to predict whether a small business will pay off or default its loan. The owner and loan variables were better predictors of loan success than the firm variables.
ON THE IMPLICATIONS OF SPECIFICATION UNCERTAINTY IN FORECASTING*
Authors: Benson P. George , Barry B.
Published: June 2007

Forecasters typically select a statistical forecasting model from among a set of alternative models. Subsequently, forecasts are generated with the chosen model and reported to management (forecast consumers) as if specification uncertainty did not exist (i.e., as if the chosen model were the “true” model of the forecast variable). In this note, a well‐known Bayesian model‐comparison procedure is used to illustrate some of the ambiguities and distortions of forecasts that do not reflect specification uncertainty. It is shown that a single selected forecasting model (however chosen) will generally misstate measures of forecast risk and lead to point and interval forecasts that are misplaced from a decision‐theoretic point of view.
HIGH‐LEVEL DECISIONS: A LESSON FROM THE IRAN HOSTAGE RESCUE OPERATION
Authors: Saaty Thomas L. , Vargas Luis G. , Barzilay Amos
Published: June 2007

We use the analytic hierarchy process to analyze the role of subjective factors in decision making as illustrated in the Iran rescue operation. Essentially, we show that a decision maker and that decision maker's advisors may differ in their estimates on whether an action should or should not be taken depending on what intangible factors the leader holds as personally important, factors that the others would not necessarily include in their thinking‐a serious point for which we provide a particularly effective methodology.
EFFECTS OF INQUIRY METHODS AND AMBIGUITY TOLERANCE ON PREDICTION PERFORMANCE*
Authors: Schwenk Charles R.
Published: June 2007

This study examined the comparative effectiveness of four inquiry methods on a financial prediction task. Inquiry methods included the expert (E), devil's advocate (DA), and dialectical inquiry (DI) techniques as well as a combined devil's advocate‐dialectical inquiry (DADI) technique. Also, the moderating effects of ambiguity tolerance were considered. Results indicated that when the state of the world was opposite to the assumptions underlying a plan, the DA, DI, and DADI approaches were all superior to the E approach. Further, for high ambiguity‐tolerance subjects, the DA and DADI approaches led to significantly better prediction performance than the E approach, and the superiority of the DADI approach over the DI approach was marginally significant. Results suggest that decision makers' levels of ambiguity tolerance should be considered before recommending their use of either the DA or DADI approach as an ill‐structured decision‐making aid.
APPLICATION OF A PRODUCTIVITY MODEL FOR COMPUTER SYSTEMS*
Authors: Kriebel Charles A. , Raviv Artur
Published: June 2007

The performance evaluation of computer systems as they impact on final user requirements for services is a complex task. A management‐oriented approach to the issue based on conventional economic theory was described in a previous report as an outgrowth of a joint university‐industry research project. In this sequel we report our experience in estimating, testing, and applying this conceptual model.
AN EMPIRICAL ANALYSIS OF THE TAX COURT'S DETERMINATION OF REASONABLE COMPENSATION
Authors: Porcano Thomas M.
Published: June 2007

The determination of reasonable compensation is one of the most frequently contested issues between the taxpayer and the IRS. The major purpose of this study is to develop a multiple regression model to predict accurately the amount of compensation allowed by the Tax Court as a percent of the amount in dispute between the taxpayer and the IRS. In general, the taxpayer receives favorable treatment in Tax Court when contesting unreasonable compensation payments. The multiple regression model, developed using a stepwise procedure, is a good predictor of the compensation allowed by the court. The overall results have important implications for developing taxpayers' appeal strategies.
A VARIANCE‐REDUCTION STRATEGY FOR RSM SIMULATION STUDIES
Authors: Cooley Belva J. , Houck Ernest C.
Published: June 2007

The application of optimization techniques in digital simulation experiments is frequently complicated by the presence of large experimental error variances. Two of the more widely accepted design strategies for the resolution of this problem include the assignment of common pseudorandom number streams and the assignment of antithetic pseudorandom number streams to the experimental points. When considered separately, however, each of these variance‐reduction procedures has rather restrictive limitations. This paper examines the simultaneous use of these two techniques as a variance‐reduction strategy in response surface methodology (RSM) analysis of simulation models. A simulation of an inventory system is used to illustrate the application and benefits of this assignment procedure, as well as the basic components of an RSM analysis.
ON THE COST OF NEW ISSUES OF COMMON STOCK: AN AMENDMENT TO THE CONSTANT GROWTH MODEL
Authors: Carlson Phillip G. , Dietz Arthur T.
Published: June 2007

Expansion decisions by corporate managements are importantly influenced by their perceptions of the firm's cost of capital and especially the cost of common equity. Their decision making is then influenced by the common perception that new issues of common stock are more costly than retained earnings because of the flotation costs inherent in new issues. Thus a rate of expansion that requires new issues is downgraded in decision making. In this paper the authors show that in actuality new issues of common equity may be less costly than retained earnings. Thus different decision‐making implications are clearly involved.
Concepts, Theory, and Techniques: FACTORS AFFECTING THE PERCEIVED UTILIZATION OF COMPUTER‐BASED DECISION SUPPORT SYSTEMS IN THE OIL INDUSTRY
Authors: Fuerst William L. , Cheney Paul H.
Published: June 2007

This study investigates factors that may affect the use of decision support systems. The independent variables investigated included: characteristics of the decision makers such as age, educational level, experience, and cognitive style; characteristics of the decision support system such as response time, accuracy, timeliness, relevancy of output, format, and the distance traveled to interact with the system; and characteristics of the implementation process such as user involvement, user training, and top management support. The study included 8 systems and 64 subjects from the oil industry. The results indicated that the most important variables affecting decision support system usage were accuracy of output, user training, relevancy of output, and the decision maker's experience.

Subject Areas: Decision Support Systems, Information Management, and Organizational Behavior.
MEASURING SUBUNIT EFFECTIVENESS
Authors: Hitt Michael A. , Ireland R. Duane , Keats Barbara W. , Vianna Antonio
Published: June 2007

The literature suggests that a multivariate approach to the measurement of effectiveness is preferred. The present study uses a policy‐capturing methodology to examine effectiveness criteria and their importance weightings for various subunits in a manufacturing organization. Effectiveness criteria and their weightings were found to vary across individual subunits. The models developed for major groupings of subunits were found to have reasonable predictive power. Finally, the predictive power of these general models varied with the degree of goal similarity among the subunits in the grouping. Useful applications of the results for managerial decisions are explored.
HEURISTIC LOT‐SIZING APPROACHES FOR DEALING WITH MRP SYSTEM NERVOUSNESS
Authors: Kropp Dean H. , Carlson Robert C. , Jucker James V.
Published: June 2007

We develop and test ways for modifying the Silver‐Meal and part‐period‐balancing lot‐sizing procedures to include the costs of schedule changes in response to changes in demand estimates. These modifications tend to reduce MRP system nervousness. We compare the performance of these approaches with the modified Wagner‐Whitin algorithm, which we have shown is optimal for static conditions. We find that the modified SilverMeal approach is only slightly more costly than the modified Wagner‐Whitin technique and that the modified part‐period‐balancing approach performs both poorly and erratically.
RISK‐RETURN ANALYSIS WITH PARTICULAR ATTENTION TO LARGE LOSSES AND SATISFACTORY GAINS
Authors: Yilmaz Mustafa R.
Published: June 2007

This paper presents a general risk‐return model that enhances the prescriptive and descriptive appeal of two‐attribute risky choice models. Conceptually, this model is fully compatible with Von Neumann‐Morgenstern expected‐utility theory. This compatibility is largely retained with simple forms of risk and return measures that are easy to estimate from preference data. A dominance version of the model yields subsets of efficient alternatives associated with stochastic dominance relationships.
A PROCUREMENT STAFFING MODEL: ESTIMATING THE SERVICE AND COST IMPACTS OF ALTERING OPERATIONS*
Authors: Morey Richard C.
Published: June 2007

Evaluating the service and cost impacts of altering procurement configurations is a common problem whenever an organization desires to be responsive to the changing needs of the populations being served. Changes relate to the volume of the work load, the degree of responsiveness required, or the technology and processes used. In real‐world situations, personnel turnovers, uneven work loads, leaves, training requirements, and use of overtime all contribute to the complexity of the task. When a range of experience over different‐sized operations is available, econometric approaches are applicable to estimate economies of scaie and technical substitution possibilities. Otherwise, queuing and job‐shop modeling, combined with simulation approaches, can be helpful. This paper presents a case study of the analysis of a proposed reorganization for a large procurement activity in the U.S. Navy. The actual job‐shop‐scheduling and task‐sequencing logic used in practice was modeled. Cost comparisons of four procurement configurations were generated under the constraints that prespecified levels of service be satisfied.
STRUCTURE, ENVIRONMENT, AND ORGANIZATIONAL GOVERNANCE IN MANUFACTURING*
Authors: Gaertner Gregory H.
Published: June 2007

The paper compares theories of organizational governance that explain delegation in decision making in terms of administrative rationality on the parts of top corporate officials with theories that emphasize lower‐level actors mobilizing resources to gain control over organizational outcomes. These two alternative theories are developed and extended to apply to the relationship between manufacturing plants and parent companies. A general model is introduced to compare these theories which includes characteristics of parent companies and site environments, site resources, and delegation. The model is then tested on a sample of manufacturing plants.
PLANNING PROCESS ARCHETYPES AND THEIR EFFECTIVENESS
Authors: Nutt Paul C.
Published: June 2007

Case studies of planning were profiled to identify how practitioners carry out a planning process. Five archetype processes emerged from the analyses which were named evaluative, historical model, off‐the‐shelf, search, and nova. These five processes were compared in terms of their adoption rate and perceived quality. The evaluative process was found to be the most successful, followed by the historical model and off‐the‐shelf processes. Nova and search processes had the least success. Contextual factors, such as time pressure and resources available, were included in the analyses to identify conditions of use for each process type. In situations where time pressure was high or the planning concerned services, the off‐the‐shelf model produced the best results; in situations where time pressure was low or the planning concerned internal operations, the historical model produced the best results. Most of the planning activity in organizations appears to be informal and heuristic, ignoring the methods described in the planning literature.
CORPORATE DISTINCTIVE COMPETENCE AND PERFORMANCE: EFFECTS OF PERCEIVED ENVIRONMENTAL UNCERTAINTY (PEU), SIZE, AND TECHNOLOGY
Authors: Hitt Michael A. , Ireland R. Duane
Published: June 2007

The relationships of specific distinctive competencies to performance were examined for firm size, type of production system, and level of perceived environmental uncertainty (PEU). The size and dominant production system used by a firm were found to have main moderating effects on those relationships although PEU by itself did not. However, PEU did interact with size and production system to moderate those relationships.
THE INVESTIGATION OF COST VARIANCES: A FUZZY SET THEORY APPROACH*
Authors: Zebda Awni
Published: June 2007

In a standard costing system, deviations (variances) of actual cost from standard cost should be investigated in order to help management identify the causes of the variances and who is responsible for them before corrective actions are taken. In reality, however, actual cost rarely equals standard cost and so many variances occur that it is impractical and uneconomical to investigate all of them. These two conflicting factors—the necessity of investigating cost variances and the impracticality of investigating all the variances—present management with the problem of deciding which variances to investigate. In this paper a model, based on fuzzy set theory, for the cost‐variance investigation is proposed and applied to an actual investigation problem faced by a manufacturing company.
THE PERFORMANCE OF A SIMPLE INCREMENTAL LOT‐SIZING RULE IN A MULTILEVEL INVENTORY ENVIRONMENT
Authors: Veral Emre A. , LaForge R. Lawrence
Published: June 2007

A simple incremental cost approach to lot sizing was tested in a multilevel inventory environment. The incremental approach has not previously been tested in a large‐scale study involving multiple product‐structure levels. Using the Wagner‐Whitin (WW) algorithm as a benchmark, the simple incremental rule (IPPA) was compared to three heuristic procedures (LFL, EOQ, and POQ) frequently used in material requirements planning (MRP) lot‐sizing research. The incremental rule consistently generated lower total order/setup and carrying costs than the three heuristics across the 3,200 multilevel test situations examined. In many of the test situations, the incremental rule also outperformed the WW benchmark.
Notes and Communications A NON‐DUAL APPROACH TO SENSITIVITY ANALYSIS—THE RIGHT‐HAND‐SIDE CASE
Authors: Erenguc S. Selcuk , Fogler H. Russell , Majthay Antal
Published: June 2007

Linear programming and sensitivity analysis in linear programming have long been integral parts of business school curricula, both at the undergraduate and graduate levels. Most business school students are required to take an introductory course in management science emphasizing linear programming and sensitivity analysis. This note is educational and presents a non‐dual approach to restoring the optimal solution to a linear program when changes in the right‐hand‐side vector render the current solution infeasible and thus nonoptimal.
A STOCHASTIC DOMINANCE ALGORITHM USING PIECEWISE LINEAR APPROXIMATIONS
Authors: Ritchken Peter H. , Agarwal Yogesh , Gupta Alok
Published: June 2007

Current stochastic dominance algorithms use step functions to approximate the cumulative distributions of the alternatives, even when the underlying random variables are known to be continuous. Since stochastic dominance tests require repeated integration of the cumulative distribution functions, a compounding of errors may result from this type of approximation. This article introduces a new stochastic dominance algorithm that approximates the cumulative distribution function by piecewise linear approximations. Comparisons between the new and old algorithms are performed for normally distributed alternatives. In about 95 percent of all cases, the two algorithms produce the same result.
THE COEFFICIENT OF VARIATION AS A FACTOR IN MRP RESEARCH
Authors: Bobko Peter B. , Whybark D. Clay
Published: June 2007

This paper investigates the use of the coefficient of variation (CV) as a measure of requirements lumpiness (the amount of variation in requirements from period to period) in material requirements planning (MRP) research. CV is used as a factor in MRP research even though it is limited as a measure. Any sequence of requirements will have a unique CV, but any CV can represent a variety of requirements sequences. This limitation raises questions concerning the robustness of CV as a measure. In this paper, two other aspects of the requirements sequence for a given CV are investigated: the procedure used to generate the requirements and the manner in which the requirements are grouped. A simulation comparison of selected lot‐sizing techniques is used to conduct the investigation. With respect to these two (new) aspects of the requirements sequence, CV appears to be a robust measure.
SOME DIFFICULTIES AND IMPROVEMENTS IN APPLYING LINEAR PROGRAMMING FORMULATIONS TO THE DISCRIMINANT PROBLEM
Authors: Markowski Edward P. , Markowski Carol A.
Published: June 2007

In this paper, we discuss some disturbing features of two linear programming (LP) approaches to the discriminant problem. Specifically, we show that both approaches are sensitive to the choice of origin for the data although, intuitively, placement of origin should have no effect on the method of assigning cases to groups. In addition, we show that these LP approaches may lead to discriminant functions which assign all cases to the same group. We show that the usual statistical approach to this problem does not share these difficulties, and we make recommendations for implementing these LP approaches which help to alleviate the difficulties.
EVALUATING ALTERNATIVE LINEAR PROGRAMMING MODELS TO SOLVE THE TWO‐GROUP DISCRIMINANT PROBLEM
Authors: Freed Ned , Glover Fred
Published: June 2007

The two‐group discriminant problem has applications in many areas, for example, differentiating between good credit risks and poor ones, between promising new firms and those likely to fail, or between patients with strong prospects for recovery and those highly at risk. To expand our tools for dealing with such problems, we propose a class of nonpara‐metric discriminant procedures based on linear programming (LP). Although these procedures have attracted considerable attention recently, only a limited number of computational studies have examined the relative merits of alternative formulations. In this paper we provide a detailed study of three contrasting formulations for the two‐group problem. The experimental design provides a variety of test conditions involving both normal and nonnormal populations. Our results establish the LP model which seeks to minimize the sum of deviations beyond the two‐group boundary as a promising alternative to more conventional linear discriminant techniques.
THE TIMING OF LABOR TRANSFERS IN DUAL RESOURCE‐CONSTRAINED SYSTEMS: “PUSH” VS. “PULL” RULES*
Authors: Treleven Mark
Published: June 2007

Altough the dual resource‐constrained (DRC) system has been studied, the decision rule used to determine when workers are eligible for transfer largely has been ignored. Some earlier studies examined the impact of this rule [5] [12] [15] but did not include labor‐transfer times in their models. Gunther [6] incorporated labour‐transfer times into his model, but the model involved only one worker and two machines. No previous study has examined decision rules that initiate labor transfers based on labor needs (“pull” rules). Labor transfers always have been initiated based on lack of need (“push” rules).

This study examines three “pull” variations of the “When” labor‐assignment decision rule. It compares their performances to the performances of two “push” rules and a comparable machine‐limited system. A nonparametric statistical test, Jonckheere's S statistic, is used to test for significance of the rankings of the rules: a robust parametric multiple‐comparison statistical test, Tukey's B statistic, is used to test the differences.

One “pull” and one “push” decision rule provide similar performances and top the rankings consistently. Decision rules for determining when labor should be transferred from one work area to another are valuable aids for managers. This especially is true for the ever‐increasing number of managers operating in organizations that recognize the benefits of a cross‐trained work force. Recently there has been much interest in cross‐training workers, perhaps because one of the mechanisms used in just‐in‐time systems to handle unbalanced work loads is to have cross‐trained workers who can be shifted as demand dictates [8]. If management is to take full advantage of a cross‐trained work force, it need to know when to transfer workers.
TESTING THE ROBUSTNESS OF MULTIATTRIBUTE UTILITY THEORY IN AN APPLIED SETTING*
Authors: Farmer Timothy A.
Published: June 2007

Multiattribute utility theory (MAUT) was employed to model the professional judgments of external auditors. Fully developed MAUT models elicited from each subject according to keeney and Raiffa's [6] procedures were used to predict the internal control systems evaluations made by auditor‐subjects. Correlation analyses were used to compare the predictive ability of the “correct” MAUT models to the accuracy of models developed under simplifications of the MAUT procedures. One simplified model resulted from relaxing the requirements for attribute independence that determine the functional forms. A second modified MAUT function was formed using unitary weightings on conditional utility functions instead of elicited scaling constants. Tests showed essentially no significant differences in predictive accuracy among the models in the contact of this study.
INFLUENCE OF MISSING ATTRIBUTES ON SELECTING A BEST MULTIATTRIBUTED ALTERNATIVE
Authors: Barron F. Hutton
Published: June 2007

Alternatives involving many factors arc difficult to evaluate because of multiple underlying competing objectives. If evaluation is based on an incomplete set of factors, and if the purpose of the evaluation is to select a single overall best alternative, inferior alternatives may be selected with surprising frequency and/or severe negative impact. At the same time, sensitivity analysis of evaluation scores based on statistical criteria can easily mask the impact and the frequency of selection of inferior alternatives. In this paper, criteria appropriate to reflect the decision impact are developed and both the frequency and impact of the selection of inferior alternatives are demonstrated empirically. Previous studies based on statistical criteria [1] [9] indicated minimal impact on overall evaluation and selection. This paper demonstrates that high statistical criterion values coexist with frequent and/or serious errors of selection.
A COMPARISON OF SEQUENCING RULES FOR A TWO‐STATE HYBRID FLOW SHOP
Authors: Narasimhan Seetharama L. , Mangiameli Paul M.
Published: June 2007

A common manufacturing environment in many industries (such as the glass, steel, paper, costume jewelry, and textile industries) is a hybrid flow shop. This system has continuous‐process machinery in the fist state of manufacturing and repetitive‐batch equipment in the second. Little research has investigated this type system. Scheduling managers of hybrid flow shops tend either to use existing job‐shop rules or to devise their own rules. These approaches often are less than adequate for efficient scheduling. In this paper we extend the rule presented by Narasimhan and Panwalker [4] to include a general class of hybrid flow shops. This extenstion, called the generalized cumulative minimum‐deviation (GCMD) rule, is compared under various operation conditions to three other sequencing rules: shortest processing time, longest processing time, and minimum deviation. The operating conditions are determined by the number of machines at both stages. The results of 7200 simulation runs demonstrate that the GCMD rule is better than the other rules in minimizing each of five chosen criteria. Thus, the GCMD rule can help managers to schedule hybrid flow shops efficiently to achieve various corporate objectives.
AN EVALUATION OF FORECAST ERROR IN MASTER PRODUCTION SCHEDULING FOR MATERIAL REQUIREMENTS PLANNING SYSTEMS.
Authors: Lee T. S. , Adam Everett E. , Ebert Ronald J.
Published: June 2007

Typical forecast‐error measures such as mean squared error, mean absolute deviation and bias generally are accepted indicators of forecasting performance. However, the eventual cost impact of forecast errors on system performance and the degree to which cost consequences are explained by typical error measures have not been studied thoroughly. The present paper demonstrates that these typical error measures often are not good predictors of cost consequences in material requirements planning (MRP) settings. MRP systems rely directly on the master production schedule (MPS) to specify gross requirements. These MRP environments receive forecast errors indirectly when the errors create inaccuracies in the MPS.

Our study results suggest that within MRP environments the predictive capabilities of forecast‐error measures are contingent on the lot‐sizing rule and the product components structure When forecast errors and MRP system costs are coanalyzed, bias emerges as having reasonable predictive ability. In further investigations of bias, loss functions are evaluated to explain the MRP cost consequences of forecast errors. Estimating the loss functions of forecast errors through regression analysis demonstrates the superiority of loss functions as measures over typical forecast error measures in the MPS.
TWO DESIGN PRINCIPLES FOR KNOWLEDGE‐BASED SYSTEMS*
Authors: Ow Peng Si , Smith Stephen F.
Published: June 2007

This paper discusses two principles that have become increasingly important in the design of knowledge‐based systems: domain‐specific knowledge used to support opportunistic reasoning and hierarchical organization structure used to control and coordinate problem‐solving activity. We propose a design framework that embodies these two principles and describe how this framework has been used to develop a knowledge‐based job‐shop scheduling system. This system, called OPIS 0, has undergone limited testing in an experimental environment modeled after an actual job shop. Its performance has been very good compared to ISIS and to the more traditional approach of constructing a schedule by dispatching jobs using the COVERT priority rule. The resulting design also shows potential for use in a decision support role.
MEASURING MASTER PRODUCTION SCHEDULE STABILITY UNDER ROLLING PLANNING HORIZONS
Authors: Sridharan Sri V. , Berry William L. , Udayabhanu V.
Published: June 2007

Maintaining a stable master production schedule (MPS) is difficult for many firms, especially when material requirements planning is used to manage production operations. This paper is concerned with the problem of measuring MPS stability, and the impact on stability of three important decision variables in managing the MPS within a rolling‐horizon framework in a make‐to‐stock environment: the method used to freeze the MPS, the proportion of the MPS frozen, and the length of the planning horizon for the MPS. Simulation experiments conducted to determine the impact of these decision variables, as well as other important product demand and cost characteristics, on MPS stability are reported. The results indicate MPS stability can be influenced by managerial action directed toward management of the MPS as well as changes in important product cost and requirements characteristics.
AN EVALUATION OF ORDER RELEASE MECHANISMS IN A JOB‐SHOP ENVIRONMENT
Authors: Ragatz Gary L. , Mabert Vincent A.
Published: June 2007

Controlling the flow of material on the shop floor involves releasing and dispatching jobs to meet customer due‐date requirements while attempting to keep operating costs low. This report presents an evaluation of five releasing mechanisms and four dispatching rules under various levels of aggregate due‐date tightness, shop cost structure, and machine utilization using simulation. The performance criteria of total shop cost, jobs on shop floor, deviation from due dates, and job queue time are collected to demonstrate the interactive nature of releasing and dispatching on shop performance.
“A JOINT ECONOMIC‐LOT‐SIZE MODEL FOR PURCHASER AND VENDOR”: A COMMENT*
Authors: Goyal S. K.
Published: June 2007

Banerjee [1] developed a joint economic‐lot‐size model for the case where a vendor produces to order for a purchaser on a lot‐for‐lot basis under deterministic conditions. The assumption of lot‐for‐lot bases is restrictive in nature. In this note, a more general joint economic‐lot‐size model is suggested and it is shown to provide a lower or equal joint total relevant cost as compared to the model of Banerjee.
The Minimum‐Covering/Shortest‐Path Problem*
Authors: Current John , ReVelle Charles , Cohon Jared
Published: June 2007

Due to the inherent multiobjective nature of many network design and routing problems, there has been a tremendous increase in multiobjective network modeling in recent years. In this article we introduce one such model, the minimum‐covering/shortest‐path (MinCSP) problem, and formulate several variations of the problem. The MinCSP problem is a two‐objective path problem: minimization of the total population negatively impacted by the path and minimization of the total path length. A population is considered to be negatively impacted by the path if the path comes within some predetermined distance of the population. Consequently, the MinCSP problem extends the concept of coverage from facility location modeling to network design. Additionally, several existing solution methods for the problem are briefly discussed and potential applications presented.
Location of Inventories in an MRP Environment
Authors: McClelland Marilyn K. , Wagner Harvey M.
Published: June 2007

Previous research on MRP systems has rarely considered at what level in a modular sub‐assembly product structure to hold inventories. Based on a simulation study of an MRP environment, we show that the correct decision concerning where to hold inventory depends on the variance in end‐item demand, the amount of inventory investment, and concomitantly, the desired level of customer service. In particular, for small investment in inventories and moderate end‐item demand variance, it is equally effective to hold inventories at the subassembly level or the end‐item level. But when end‐item demand variance is high, subassembly level inventories are better. As inventory investment grows, however, it is best to use a diversified approach of holding both subassembly and end‐item inventories, irrespective of end‐item demand variance. The robustness of these conclusions is validated by simulating a hypothetical firm that also uses safety time to hedge against uncertainties.