bluuebunny/crossref_metadata_2025 huggingface dataset:
Evaluating Program and Managerial Efficiency: An Application of Data Envelopment Analysis to Program Follow Through
Authors: Charnes A. , Cooper W. W. , Rhodes E.
Published: November 2008

A model for measuring the efficiency of Decision Making Units (=DMU's) is presented, along with related methods of implementation and interpretation. The term DMU is intended to emphasize an orientation toward managed entities in the public and/or not-for-profit sectors. The proposed approach is applicable to the multiple outputs and designated inputs which are common for such DMU's. A priori weights, or imputations of a market-price-value character are not required.

A mathematical programming model applied to observational data provides a new way of obtaining empirical estimates of extrernal relations—such as the production functions and/or efficient production possibility surfaces that are a cornerstone of modern economics. The resulting extremal relations are used to envelop the observations in order to obtain the efficiency measures that form a focus of the present paper.

An illustrative application utilizes data from Program Follow Through (=PFT). A large scale social experiment in public school education, it was designed to test the advantages of PFT relative to designated NFT (=Non-Follow Through) counterparts in various parts of the U.S. It is possible that the resulting observations are contaminated with inefficiencies due to the way DMU's were managed en route to assessing whether PFT (as a program) is superior to its NFT alternative. A further mathematical programming development is therefore undertaken to distinguish between “management efficiency” and “program efficiency.” This is done via procedures referred to as Data Envelopment Analysis (=DEA) in which one first obtains boundaries or envelopes from the data for PFT and NFT, respectively. These boundaries provide a basis for estimating the relative efficiency of the DMU's operating under these programs. These DMU's are then adjusted up to their program boundaries, after which a new inter-program envelope is obtained for evaluating the PFT and NFT programs with the estimated managerial inefficiencies eliminated.

The claimed superiority of PFT fails to be validated in this illustrative application. Our DEA approach, however, suggests the additional possibility of new approaches obtained from PFT-NFT combinations which may be superior to either of them alone. Validating such possibilities cannot be done only by statistical or other modelings. It requires recourse to field studies, including audits (e.g., of a U.S. General Accounting Office variety) and therefore ways in which the results of a DEA approach may be used to guide such further studies (or audits) are also indicated.
Note—Participative Design of Strategic Decision Support Systems: An Empirical Assessment
Authors: King William R. , Rodriguez Jamie I.
Published: November 2008

The concept of “participative systems design” should be as applicable to strategic management decision support systems as it is generally believed to be to lower-level systems. This study tests hypotheses concerning participative design using data describing the participation and performance of managers prior to during, and after implementation of a participatively designed system. The study concludes that there is some effect of participation on the attitudes of participants, but no measurable effect on the amount of system usage. The nature of system use was found to be related to inputs provided in the design process by participants. No advantage was found for participants in terms of the “quality” of decision making.
Note—On “An Interpretation of Fractional Objectives in Goal Programming as Related to Papers by Awerbuch et al., and Hannan”
Authors: Hannan Edward L.
Published: November 2008

This Note points out a minor error in a technique developed by Soyster and Level (Soyster, A. L., B. Lev. 1978. An interpretation of fractional objectives in goal programming as related to papers by Awerbuch et al., and Hannan. Management Sci. 24 (14) 1546–1549.) for determining if a linear goal can be substituted for a fractional goal in a goal programming problem. A revised formulation is provided.
A Two Server Queue with Nonwaiting Customers Receiving Specialized Service
Authors: Brill P. H. , Posner M. J. M.
Published: November 2008

The stationary distributions of the waiting time and number in the system are obtained for a variant of an M/M/2 queue in which non-waiting customers receive a different rate of service from those who must wait in line. Characteristics of the solution, and applications of the model are discussed. The solution has also been generalized to any finite number of servers, using the same technique. The analysis utilizes the new System Point (SP) method for analyzing queues. This method employs the relationship between virtual waiting time sample function down- and up-crossings of a level, and the probability density function of the virtual wait at that level. Brief outlines of the SP approach, and relevant theory are included.
Management Science Update Column—The Past, Present and Future Histories of an Old Paper
Authors: Hall John R.
Published: November 2008

One of my University of Pennsylvania professors, Kenneth D. MacKenzie (now at the University of Kansas), sent in this update of his December 1970 Management Science article “Analysis of a Decision Making Investigation.” Once I saw Ken's title (above) for this update. I knew we were in for some fun. I've cut the essay a little and I've knocked out Ken's lengthy bibliography of related articles and books (which you may want to write him about) because Marty Starr likes to run some new stuff in this journal, too.
A Polynomially Bounded Algorithm for a Nonlinear Network Allocation Problem
Authors: Elken T. R. , Freedman H. T. , Gibson A. E.
Published: November 2008

This paper presents an algorithm for determining the optimal allocation to demand points when the distribution system is a capacitated arborescence of N arcs and the cost (return) functions are convex (concave). It is proved that the algorithm generates an optimal solution by solving at most N(N + 1)/2 single-constraint subproblems. If the cost functions allow the Lagrange multiplier for the subproblems to be evaluated in polynomial time, then this is a polynomial algorithm. The analysis is motivated by the problem of allocating spare capacity in the loop plant portion of telephone networks.
Erratum to “A Theory of the U.S. Treasury Market Equilibrium”
Authors: Barry John Y. , Ayres Herbert F.
Published: November 2008

Erratum to Barry, John Y., Herbert F. Ayres. 1980. A theory of the U.S. treasury market equilibrium. Management Sci. 26 (6) 539–569.
State of the Art—A Survey of Partially Observable Markov Decision Processes: Theory, Models, and Algorithms
Authors: Monahan George E.
Published: November 2008

This paper surveys models and algorithms dealing with partially observable Markov decision processes. A partially observable Markov decision process (POMDP) is a generalization of a Markov decision process which permits uncertainty regarding the state of a Markov process and allows for state information acquisition. A general framework for finite state and action POMDP's is presented. Next, there is a brief discussion of the development of POMDP's and their relationship with other decision processes. A wide range of models in such areas as quality control, machine maintenance, internal auditing, learning, and optimal stopping are discussed within the POMDP-framework. Lastly, algorithms for computing optimal solutions to POMDP's are presented.
Performance of a Regulatory Agency as a Function of its Structure and Client Environment: A Simulation Study
Authors: Thompson W. A. , Vertinsky I. , Kira D. , Scharpf F. W.
Published: November 2008

This paper examines some of the interrelationships between the formal organization of a regulatory agency and its task environment. Central to the analysis is the development of a simulation model of a regulatory agency. The model depicts the agency as an hierarchical assemblage of decision units whose overall goal is to satisfy clients without antagonizing competitive interests. The model of the agency incorporates the formal structure of authority, the communication network and the process of exchange of informal obligations between agency decision units. The agency's task environment is composed of clients, each of whom communicates his problems to be solved to a different decision unit. As we posit a number of competitive and complementary relationships between clients, the resolution of a problem for one client will impose positive and negative externalities on other clients. While the goals of different decision units may come into conflict, decision units in the model cannot act independently; a coalition is required to resolve a problem.

Simulation experiments were conducted to investigate the proposition that formal organizational structure will affect agency performance. In particular we hypothesized: (I) that alignment of agency structure (formal lines of authority) with environmental structure (relationships between clients) will significantly affect organizational performance; and (II) that organizational performance will be highest when all clients with mutual interests (competitive and complementary) are served by a single division of the agency. Organizational performance was measured by: input effectiveness—number of internal messages required to solve a problem; processing capacity—average waiting time per message; and agency responsiveness—a client satisfaction index combining waiting time for solution and agency response. Results of the simulation experiments confirmed hypothesis I and rejected hypothesis II. In task environments which favored prompt resolution of problems, inter-divisional communication was facillitated by separating complementary interests into different divisions while concentrating competitive interests within divisions. In environments which favored inaction, the reverse organization had best performance.
User Involvement in Information System Development: A Conflict Model and Empirical Test
Authors: Robey Daniel , Farrow Dana
Published: November 2008

This research explores the relationships among user participation, influence, conflict, and conflict resolution in the development of management information systems. Three stages of development are analyzed: initiation, design, and implementation. Results show that influence does result from user participation, and that influence leads to both conflict and resolution. Participation without influence, however, does not lead to successful conflict resolution in any of the three development stages.
Nonlinear Optimization by Successive Linear Programming
Authors: Palacios-Gomez F. , Lasdon L. , Engquist M.
Published: November 2008

Successive Linear Programming (SLP), which is also known as the Method of Approximation Programming, solves nonlinear optimization problems via a sequence of linear programs. This paper reports on promising computational results with SLP that contrast with the poor performance indicated by previously published comparative tests. The paper provides a detailed description of an efficient, reliable SLP algorithm along with a convergence theorem for linearly constrained problems and extensive computational results. It also discusses several alternative strategies for implementing SLP. The computational results show that SLP compares favorably with the Generalized Reduced Gradient Code GRG2 and with MINOS/GRG. It appears that SLP will be most successful when applied to large problems with low degrees of freedom.
A Production Function for Organizations Doing Case Work
Authors: Beckmann Martin J.
Published: November 2008

This paper examines the contribution of supervisors to an organization's output by constructing a production function in which supervisors' time and case workers' time enter as inputs. There is a quality variable associated with output: average delay. The functional form of the production function is derived for the simplest possible type of queuing model, but the method can be applied to other specifications of the queuing process and of the quality variable. Such a production function can be used to determine the most cost effective span of control. The model is extended to obtain a multi-factor production function for multi-level organizations. Numbers from a welfare agency are used as illustrations but no empirical validation is attempted.
Some Comments on the Development and Application of Linear Learning Models
Authors: Leeflang Peter S. H. , Boonstra Anne
Published: November 2008

This paper evaluates some learning models and explores the possibility of extending the linear learning models by adding explanatory variables, using Lilien's model as a point of departure. Two parameter estimation schemes are proposed and applied: one at the micro-level using consumer panel data (micro-data) and the other at the macro-level using aggregate time-series data (macro-data). The use of micro-data restrains the estimation of effects to a limited number of decision variables in Lilien's model, because of a lack of degrees of freedom. It is shown that by modifying the equations of Lilien's model and by considering more than two brands the number of degrees of freedom can be increased considerably. This opens the possibility of estimating the response parameters of many more explanatory variables, in theory. However, practically speaking, estimation remains difficult because the parameters in the modified model are heavily restricted by standard probabilistic and other constraints. The endeavor to estimate the parameters of the modified linear learning model using macro-data is not feasible. This leads to the conclusion that the application of learning models in the area of decision-making in marketing is rather difficult and limited.
Geographic Decomposition of the Shortest Path Problem, with an Application to the Traffic Assignment Problem
Authors: Lansdowne Zachary F. , Robinson David W.
Published: November 2008

An algorithm, which can be applied to loosely connected networks, is given for geographically decomposing the shortest path problem. The algorithm is applicable to the traffic assignment problem when it is solved as a series of shortest path problems by the Frank-Wolfe algorithm. Numerical results for a large 1287 node, 3752 arc traffic assignment problem for Washington, D.C., indicate that using geographical decomposition can reduce computer memory storage requirements or program run time.
Integrating New Technical Staff: Implications for Acquiring New Technology
Authors: Lee Denis M. S. , Allen Thomas J.
Published: November 2008

Hiring new staff in R&D provides an important opportunity for a firm to acquire new technological knowledge. It also takes a considerable length of time before new R&D staff become fully integrated into the organization. This study compares the communication patterns of new and veteran R&D staff as a function of their work activities. The results suggest that both the benefits and problems in the hiring and integration of new R&D staff is moderated by the type of research, development or technical service work involved. Particular attention should be paid to the integration of new staff involved in new product or process development, where the benefits of bringing in new people are great, but the communication barriers to overcome are also found to be the most serious.
Diffusion of Modern Software Practices: Influence of Centralization and Formalization
Authors: Zmud Robert W.
Published: November 2008

Centralization and formalization have previously been employed in research designs investigating organizational innovation. The results, however, have been mixed. Three arguments are raised toward explaining this inconsistency. First, innovation is a multi-phased process in which the influence of centralization and formalization could be expected to differ. Second, as innovations may vary with regard to their compatibility to individuals in organizations, the expected influence of centralization and formalization may also vary. Third, organizational innovations may be directed toward particular vested interests, such as the technical or administrative core. Accordingly, the influence of centralization and formalization may also vary.

This paper reports on a study which examines the influence of centralization and formalization on organizational innovation given the arguments given above. The effectiveness of employing structural overlays to overcome the conflicting forces often arising between organizational processes and particular organizational behaviors—such as innovative behavior—is investigated as well.

Managers of 49 software development groups responded to a questionnaire assessing the influences of centralization and formalization on the initiation, adoption, and implementation of six modern software practices (MSP) within their software groups. Three of the MSP were technical in nature and three were administrative. The technical MSP were viewed as being incompatible to the technical core. Two structural overlays were investigated regarding their ability to improve the diffusion process: the existence of a formal body responsible for identifying MSP and introducing them into the software group; and, the assignment of computer specialists to projects as “set” teams.
Does Divisional Play Lead to More Pennant Races?
Authors: Winston Wayne , Soni Ashok
Published: November 2008

A “pennant race” occurs in a sports league if the top two teams in a league finish within m̄ games of each other. We develop an analytical model that can be used to predict the probability that a sports league will have a pennant race. The model is then tested on data from the last 50 major league baseball seasons and is shown to do a remarkable job of predicting the number of pennant races that actually occurred. Finally, we give conditions which ensure that dividing a league of 2n teams into 2n-team divisions will increase the expected number of pennant races. As a corollary to this result we prove that the divisional structure which maximizes the expected number of pennant races must contain no divisions with 4 or more teams.
Firm's Forecasts of Engineering Employment
Authors: Brach Peter , Mansfield Edwin
Published: November 2008

In this paper we present data concerning the accuracy of firm's forecasts of engineering employment and suggest a simple model that may be of use in improving their accuracy. The results, which pertain to 54 firms in the aerospace, electronics, chemical, and oil industries, should be of use to managers, because the formulation of proper manpower policies clearly depends on the precision of such forecasts. Our approach also may be applicable to personnel other than engineers: better forecasts may result from the application of this simple model.
Modeling to Generate Alternatives: The HSJ Approach and an Illustration Using a Problem in Land Use Planning
Authors: Brill E. Downey , Chang Shoou-Yuh , Hopkins Lewis D.
Published: November 2008

Public-sector planning problems are typically complex, and some important planning issues cannot be captured within a mathematical programming model of a problem; such issues may be qualitative in nature, unknown, or unrevealed by decisionmakers. Furthermore, there are often numerous solutions to a mathematical formulation that are nearly the same with respect to modeled issues but that are drastically different from each other in decision space. In such cases, some of these solutions may be significantly better than others with respect to unmodeled issues. Thus, a potentially important role of programming models is to generate a small number of alternative solutions that are feasible, perform well with respect to modeled issues, and are significantly different with respect to the decisions they specify. Such a set of alternatives may aid analysts and decision makers in understanding the problem and may serve as a catalyst for human creativity and invention.

The Hop, Skip, and Jump (HSJ) method has been developed for this purpose. It is designed to produce alternative solutions that are very different from previously generated solutions. Each solution generated is good in the sense that it meets targets specified for modeled objectives. The technique is described in this paper, and is illustrated using a multiobjective linear programming model of a land use planning problem provided by a regional planning commission. In this case, the method is shown to be capable of generating alternative solutions that perform well with respect to the modeled objectives and that are drastically different with respect to the land use pattern specified. Differences among solutions are discussed using visual inspection as well as simple quantitative measures. The technique can be used to extend the capabilities of existing mathematical programming packages.
An Experimental Study of Performance Information Systems
Authors: Luzi Andrew D. , Mackenzie Kenneth D.
Published: November 2008

Performance information systems minimally consist of a performance standard, performance measurement, incentives to match performance to the standard, and periodic reports on performance. In this study four performance information systems are imposed on laboratory groups solving simple routine problems. These included speed, minimum messages, minimum error, and voting. There was a control condition with no explicit, performance information system. In aggregate, the groups tried to meet the assigned standard of performance. The performance information systems also set into motion other group processes resulting in numerous sensible but unanticipated consequences. It was not possible to conclude that the explicit performance information systems improved overall performance. The choice of performance information system did affect the task processes, the choice of structure, and the involvement in task supporting processes. The variability of behavior within each group suggests caution in widespread application of performance information systems.
Using Lagrangean Techniques to Solve Hierarchical Production Planning Problems
Authors: Graves Stephen C.
Published: November 2008

This paper proposes and tests a procedure for decomposing a large scale production planning problem modeled as a mixed-integer linear program. We interpret this decomposition in the context of Hax and Meal's hierarchical framework for production planning. The procedure decomposes the production planning problem into two subproblems which correspond to the aggregate planning subproblem and a disaggregation subproblem in the Hax-Meal framework. The linking mechanism for these two subproblems is an inventory consistency relationship which is priced out by a set of Lagrange multipliers. The best values for the multipliers are found by an iterative procedure which may be interpreted as a feedback mechanism in the Hax-Meal framework. At each iteration, the procedure finds both a lower bound on the optimal value to the production planning problem and a feasible solution from which an upper bound is obtained. Our computational tests show that the best feasible solution found from this procedure is very close to optimal. For thirty-six test problems the percentage deviation from optimality never exceeds 4.4%, and the average percentage deviation is 2.2%. In addition, these best feasible solutions dominate the corresponding solutions obtained by a hierarchical procedure.
Decision Analysis of Program Choices in Magnetic Fusion Energy Development
Authors: North D. Warner , Stengel Donald N.
Published: November 2008

This paper describes a methodology based on decision analysis for addressing major program decisions in the development of magnetic fusion energy. The development of this complex technology involves a sequence of funding choices over time among multiple technical approaches and under considerable performance uncertainty. The methodology focuses on the next major facility decision in the U.S magnetic fusion energy program. The decision alternatives include the construction and testing of a major experimental facility based on one of two leading technical approaches (reactor designs), an accelerated program where both approaches are pursued, or delaying another facility until more information is available. Subsequent decisions depend on the first decision and its outcome and involve either further development of the best technical approach or abandonment of the entire research and development program. Analysis of a particular sequence of program decisions takes account of the uncertainties in the ultimate economic performance (cents per kilowatt-hour) of the resulting commercial reactor, the time of commercial availability, and market penetration. Reactor performance is analyzed at a component level and explicitly considers the dependence of component performances based on one technical approach on the respective component performances of alternative approaches. The net benefits of magnetic fusion R&D are assessed by computing the discounted expected cost savings attributable to commercial magnetic fusion energy minus the discounted costs of the R&D program.
A Systematic Approach to Nuclear Safeguards Decision-Making
Authors: Judd Bruce R. , Weissenberger Stein
Published: November 2008

The regulatory decision on how safe a safeguarded nuclear facility should be depends on a trade-off between diversion risk and the cost of reducing that risk. Given that one plans to build the plant, the optimum level of safeguards is achieved when the cost of further risk reduction exceeds the benefit from lower risk. This paper develops quantitative models of factors that influence this risk/cost trade-off. A basic conceptual structure is presented, and a detailed example is used to illustrate the methodology for optimal regulation setting.
Leadership: Perspectives in Theory and Research
Authors: Jago Arthur G.
Published: November 2008

Prominent trends in leadership research are reviewed. Theoretical perspectives are organized in a four-fold typology based on the dominating assumptions of the research effort: (1) the focus on a universally appropriate set of leadership traits, (2) the focus on a universally appropriate behavioral style, (3) the focus on situationally contingent leadership traits, and (4) the focus on situationally contingent behavioral styles. Potential organizational prescriptions following from each perspective are identified (e.g., selection, placement, training). It is argued that existing research has mapped only a portion of the domain of leadership phenomena due to a concentration on relatively few leadership constructs and because of the popularity of a limited set of empirical methodologies. Recent developments, promising new directions, and novel methods in leadership research are described.
The Application of Queueing Theory to Continuous Perishable Inventory Systems
Authors: Graves Stephen C.
Published: November 2008

This paper develops two distinct models for studying inventory systems with continuous production and perishable items. The perishable items have a deterministic usable life after which they must be outdated. For each of the models, analytical expressions derived from queueing theory, are found for the steady-state distribution of system inventory. Knowledge of this steady-state behavior may be used for evaluation of system performance, and for consideration of alternatives for improving system performance.

Both models assume that inventory is replenished by a continuous production process. The first model, assuming continuous inventory units, has Poisson demand requests with the size of each request distributed as an exponential random variable. The second model has Poisson demand requests with all demands being for a single unit. The analysis for both models exploits the similarity of the inventory system with a single-server queueing system.
Advertising Budget Allocation under Uncertainty
Authors: Holthausen Duncan M. , Assmus Gert
Published: November 2008

This article presents a model for the allocation of an advertising budget to geographic market segments, or territories, when the sales response to advertising in each segment is characterized by a probability distribution. It is shown that allocation decisions that are based on the expected sales response may be associated with a relatively large degree of risk and, therefore, non-optimal to a risk-averse manager. The model derives an “efficient frontier” in terms of the expected profit and its variance resulting from alternative budget allocations. The manager then chooses the optimal allocation based on his/her preference function.
Rejoinder—On “A Note on MRP Lot Sizing”
Authors: Steinberg Earle , Napier H. Albert
Published: November 2008

Rejoinder to “On ‘A Note on MRP Lot Sizing’” (McClain, J., W. L. Maxwell, J. A. Muckstadt, L. T. Thomas, E. N. Weiss. 1982. A note on MRP lot sizing. Management Sci. 28 (5, May) 582–584.).
On the Borda-Kendall Consensus Method for Priority Ranking Problems
Authors: Cook Wade D. , Seiford Lawrence M.
Published: November 2008

This paper investigates the Borda-Kendall method for the determination of a consensus ranking. It is shown that in the case of ties the method does not perform as claimed. A “minimum variance” method for determining the consensus ranking is proposed and its properties examined. It is shown to be equivalent to the Borda-Kendall method if ties are not allowed. An algorithm to determine the “minimum variance” consensus ranking in the case of ties is described. Results obtained from the solution of problems of various sizes are discussed.
Optimal Consumption Policy under Uncertain Income
Authors: Mendelson Haim , Amihud Yakov
Published: November 2008

This paper considers the consumption behavior of a risk-averse consumer with a preference for immediate consumption who faces an uncertain income stream and plans for a finite or infinite number of periods. The consumer may borrow up to a limit or save, where both saving and borrowing are subject to the same positive rate of interest. We derive the optimal consumption policies for both finite and infinite planning horizons, investigate their characteristics, and analyze their economic and behavioral implications.
An Empirical Bayes Estimate of Market Risk
Authors: Maier Steven F. , Peterson David W. , Vander Weide James H.
Published: November 2008

Starting with a market model of security returns, we describe how the parameters of a distribution for security characteristics can be estimated in a manner correcting for a subtle but significant source of error. When this error is removed, strong negative correlations between “alpha” and “beta” and between “alpha” and “sigma squared,” and a strong positive correlation between “beta” and “sigma squared” are observed. With this feature in the prior distribution, and with the results of a regression for a particular security, we develop an empirical Bayes estimate of the security's three parameters (alpha, beta and sigma squared) which makes use of more information than other estimates described in the literature.
The Bond Scheduling Problem of the Multi-Subsidiary Holding Company
Authors: Baker Kenneth R. , Vander Weide James H.
Published: November 2008

This paper presents a decision-theoretic model of the bond scheduling problem faced by a multi-subsidiary holding company such as AT&T or GTE. The objective is to minimize the total cost of bond flotations across all subsidiaries, where total cost is the sum of the yield paid to investors, the flotation expense associated with the preparation of each issue and the opportunity expense to each subsidiary of not meeting its request at the desired time. Our model suggests that the timing of bond issues is primarily a problem in trading off the diseconomies of issuing many bonds in one month with the penalty costs of delay. An efficient dynamic programming algorithm for solving the problem is also presented along with an example.
The Two-Product, Single-Machine, Static Demand, Infinite Horizon Lot Scheduling Problem
Authors: Boctor Fayez Fouad
Published: November 2008

In this paper, we deal with the two-product, single-machine, static demand, infinite horizon lot scheduling problem. After a quick review of the literature, the necessary and sufficient conditions for feasibility are derived without imposing any preliminary requirements. Then, an optimal solution algorithm is presented. Finally, we show that a necessary condition for the feasibility of N-product schedules is that each cycle time be an integer multiple of some basic cycle time.
A General Class of Holt-Winters Type Forecasting Models
Authors: Roberts S. A.
Published: November 2008

This paper is concerned with the formulation of short-term forecasting models, and introduces a range of models of considerable importance. These are defined in terms of predictions and sensible updating mechanisms for estimates of quantities such as level, growth, and seasonality, and constitute generalizations of familiar (linear) exponential smoothing predictors. They are shown to be equivalent to particular ARIMA models, and generally these do not lie within that subset of the ARIMA class which forms the basis of the Box-Jenkins modelling approach. It is argued that the models of this paper have a reasoned structure, and are to be preferred to the Box-Jenkins models for most socio-economic applications.
Size and Administrative Intensity in Organizational Divisions
Authors: Lioukas Spyros K. , Xerokostas Demitris A.
Published: November 2008

This paper investigates the relationship between the size of an organization and the number of its administrative personnel drawing upon information from 46 local electricity distribution divisions. Traditionally size has been treated as a uni-dimensional concept, and various single measures/indicators have been used to represent it. In contrast to this view the present study considers size as multi-dimensional. An array of indicators is used and factor analysis is employed to uncover underlying distinct dimensions. In a further step the relationship between the administrative component, i.e., the number of administrative personnel, and the revealed distinct dimensions of size is examined. Results show that the administrative component increases less than proportionately with output-related dimensions of size, thus suggesting that here there are economies of scale. On the other hand the administrative component appears to be weakly related or unrelated to other dimensions expressing fixed assets, market characteristics and growth. Theoretical and practical implications of the analysis are discussed.
Relative Risk Aversion
Authors: Dyer James S. , Sarin Rakesh K.
Published: November 2008

An individual's preference for risky alternatives is influenced by the strength of preference he feels for the consequences and his attitude toward risk taking. Conventional measures of risk attitude confound these two factors. In this paper we formally separate these factors and explore how this separation might significantly enhance our understanding of decision making under risk.

We introduce a new measure of risk attitude defined relative to strength of preference. This measure is based on comparing an individual's von Neumann-Morgenstern utility function to his strength of preference function. The properties of this measure of relative risk attitude are developed.

The concept of relative risk attitude has several important implications. First, it provides a better description of an individual's attitude toward risk. Second, it provides a better way to combine preferences of various experts in the context of multicriteria decision making. Finally, it provides a better insight into the implications of some commonly employed preference aggregation rules in group decision making.
A Method for the Prescriptive Assessment of the Flow of Information Within Organizations
Authors: Delehanty Thomas , Sullo Pasquale , Wallace William A.
Published: November 2008

Research on information flow in organizational networks has focused on structural aspects and the identification and location of special communicators or “gatekeepers.” In this paper, the methods of system reliability are adapted to the systematic analysis of information flow networks; in this context, system reliability is the probability of information flow between the information source and the ultimate recipient, while arc reliability is the probability of information flow on that arc. Gatekeepers generally differ from other nodes in the network by virtue of their greater number of and more reliable incoming and outgoing arcs. Through methods illustrated here, gatekeepers, as well as other nodes and their connecting arcs, can be assessed with respect to their contribution to system effectiveness (reliability). With this analytical capability, the manager can explore and assess alternate courses of action in order to adopt those which most enhance system effectiveness. The approach is illustrated by application to two representative studies from the literature on information flow in R&D organizations.
A Mixed Exponential Time Series Model
Authors: Lawrance A. J. , Lewis P. A. W.
Published: November 2008

The simple model NMEAR (1) is described for a stationary dependent sequence of random variables which have a mixed exponential marginal distribution; the model is a first-order stochastic difference equation with random coefficients and is first-order Markovian. It should be broadly applicable for stochastic modelling in operations analysis. In particular, it provides a model for simulating interarrival times in queuing systems when these random variables are overdispersed relative to an exponential random variable, and moreover are positively correlated. The model also has capability to model a variable which may be zero, but which otherwise is exponentially distributed. Such variables are found as waiting times in queuing models. Because of the (random) linearity of the process, it is easily extended to the modelling of cross-coupled sequences of interarrival and service times. The model can also be extended quite simply to a mixed exponential process with mixed pth order autoregressive and qth order moving average correlation structure, NMEAR (p, q), so that non-Markovian dependence can be handled.
Temporal Aggregation, the Data Interval Bias, and Empirical Estimation of Bimonthly Relations from Annual Data
Authors: Bass Frank M. , Leone Robert P.
Published: November 2008

In an important study reviewing the literature on econometric studies of the relationship between advertising and sales Clarke (Clarke, Darral G. 1976. Econometric measurement of the duration of advertising effects on sales. J. Marketing Res. 13 (November) 345–357.) concluded that the implied duration interval of the effects of advertising on sales were too long when the studies used annual data. A theoretical explanation is provided here for the observation of parameter estimates which vary with the data interval employed in the analysis. Parameter estimates are developed on the basis of data aggregated at various levels of temporal aggregation and compared with theoretical values. It is demonstrated that it is possible to recover bimonthly parameters when only annual data are available.
A Corporate System Model of a Sports Club: Using Simulation as an Aid to Policy Making in a Crisis
Authors: Hall Roger I. , Menzies William B.
Published: November 2008

The sports club, described in this study, was losing members and in dire financial straits. It became obvious from the optimistic forecasts and fragmented historical records that the membership system was poorly understood by the club's decision making groups and committees. A corporate system model of the club was developed from interviews with the club executive and influential club members. In this way an understanding was gained of the fundamental system of relations determining the viability of the club. Various suggestions for remedial action were tried out on a simulation version of the model and the results communicated to the board of directors. The study serves to illustrate the use of computer simulation modeling, not as an optimising or forecasting tool, but as an aid to policy making in a crisis. It became part of the organizational behavior process for coping with an extreme situation that, in this case, had a happy ending. The study attempts to relate the scientific process of synthesizing a formal model with the psychological and socio-political processes of decision making in a complex system during a crisis.
A Sensitivity Analysis of Variable-Base Budgeting
Authors: Blanning Robert W.
Published: November 2008

In variable-base budgeting an organization's resources are partitioned into two categories, those allocated to decision making and those allocated to implementation, and both sets of resources are further subdivided as necessary—between departments, across time stages, etc. The purpose of the budgeting effort is to maximize an expected return, which depends on that part of the organization's resources allocated to implementation, net of risk, which is reduced by allocating resources to decision making. In a previous paper it was shown that zero-base budgeting, in which substantial resources are allocated to decision making, is optimal only under certain conditions, one of which is that management resources must be costless. Since these conditions seldom obtain in the real world, it seems reasonable to examine the sensitivity of the risk/return performance of a zero-base strategy with respect to deviations from the conditions for which that strategy is optimal. The principal conclusion of the research reported here is that the mesa phenomenon—the relative insensitivity of the outcome of resource allocation decisions in the neighborhood of the optimum—applies to the allocation of management resources as well.
A Hybrid Algorithm for Simultaneous Scheduling of Production and Distribution in Multi-Echelon Structures
Authors: Williams Jack F.
Published: November 2008

This paper presents a dynamic programming algorithm for simultaneous determination of production batch sizes in an assembly network and distribution batch sizes in a conjoined distribution (“arborescent”) network. The objective is to minimize average cost per period over an infinite horizon. Costs consist of processing costs at each node and linear holding costs for inventory. Final product demand rates may vary among the retail nodes, but at each retail node the demand rate is assumed to be known, constant, and continuous. All demand must be met; backorders are not permitted. The model can be used for a single product, or for several products that are temporarily combined for distribution, or for scheduling production in a system where several end products are produced from the same intermediate product, as in some biochemical manufacturing processes.
A Study of Economists' Consensus Forecasts
Authors: Ahlers David , Lakonishok Josef
Published: November 2008

This study examines the ability of economists to forecast ten major economic series. The data for this study were provided by J. A. Livingston of the Philadelphia Inquirer, who since 1947 has collected forecasts for the upcoming 6 and 12 months. The results reveal that, in general, for the period from 1947 through 1978, the economists in Livingston's sample did not produce efficient forecasts and were not able to outperform simple statistical models. It should be noted, however, that a substantial and consistent improvement in forecasting performance by economists in Livingston's sample did occur over this same period. These results contain important information for managers who use macro-economic consensus forecasts.
Mathematical Programming Approaches to Capacity-Constrained MRP Systems: Review, Formulation and Problem Reduction
Authors: Billington Peter J. , McClain John O. , Thomas L. Joseph
Published: November 2008

This paper introduces a line of research on capacity-constrained multi-stage production scheduling problems. The first section introduces the problem area as it arises from a failure of MRP systems. Then a review of the literature and an analysis of the type of problems that exist are presented in §2. Section 3 outlines linear and mixed integer-linear programming formulations. These formulations compute the required production lead times according to the demands on available capacity, thereby reducing in-process inventory compared to the usual practice in MRP. A discussion of how to use the LP version is included. However, the size of the problems in practice implies that more efficient solution techniques must be found. The final topic of this paper, Product Structure Compression, is introduced as a method to reduce the size of the problem without losing optimality.
Note—On Choosing Between Rev. Bayes and Prof. Von Neumann
Authors: Kahan James P.
Published: November 2008

In a recent issue of Management Science, Kadane and Larkey [10], [11] debated with Harsanyi [8], [9] on the relative merits of strategic policies derived from game theoretic vs. Bayesian decision-theoretic orientations. While the fact that the two orientations are virtually first cousins gives a Middle Eastern flavor to the discussion, just as the problems of that unfortunate spot on the globe, the two orientations have substantive differences that should be attended to by people faced with managerial decision problems modelled as games.
Note—Subjective Probability and the Theory of Games: Some Further Comments
Authors: Roth Alvin E. , Schoumaker Françoise
Published: November 2008

This note reconsiders some of the issues raised by Kadane and Larkey, and Harsanyi, and briefly discusses some relevant empirical results.
Comment on “The Confusion of Is and Ought in Game Theoretic Contexts”
Authors: Shubik Martin
Published: November 2008

Comment about Kadane, J. B., P. D. Larkey. 1983. The confusion of is and ought in game theoretic contexts. Management Sci. 29(12) 1365–1379.
A 0-1 Model for Solving the Corrugator Trim Problem
Authors: Haessler Robert W. , Talbot F. Brian
Published: November 2008

A new method for solving the corrugator trim problem is presented. This problem draws its name from the difficult task facing scheduling personnel in corrugator box plants each day: to determine the least-cost method of combining customer orders on the corrugator, where one of the major costs to avoid is waste or excess trim lost from the materials used. Trim loss, however, is only one of several major concerns. Others include corrugator width utilization, cutting pattern changes, avoidance of split orders, and so on. A full discussion of these factors and associated trade-offs is included in the paper.

The solution procedure presented is capable of dealing with these and other trade-offs in a systematic manner. In particular, this approach eliminates the spreading of orders over several stock sizes, a characteristic which has plagued the linear programming-based procedures that have been proposed for solving the problem. This improved material handling characteristic of the solution is obtained through the controlled generation of solution elements. These elements then become potential activities to be scheduled by a 0-1 integer programming algorithm. The algorithm used is well suited to computers of moderate size and speed.

In addition to solving the corrugator trim problem, the proposed method has sufficient flexibility to make it a useful vehicle for solving similar problems in other industries which manufacture such products as glass, steel, composition board, and furniture.