Information and Product Quality; Standardization and Compatibility

The 2012 Power Trading Agent Competition (Research Paper)

Ketter, W. — 2012-09-10T00:00:00Z

This is the specification for the Power Trading Agent Competition for 2012 (Power TAC 2012). Power TAC is a competitive simulation that models a “liberalized” retail electrical energy market, where competing business entities or “brokers” offer energy services to customers through tariff contracts, and must then serve those customers by trading in a wholesale market. Brokers are challenged to maximize their profits by buying and selling energy in the wholesale and retail markets, subject to fixed costs and constraints. Costs include fees for publication and withdrawal of tariffs, and distribution fees for transporting energy to their contracted customers. Costs are also incurred whenever there is an imbalance between a broker’s total contracted energy supply and demand within a given time slot. The simulation environment models a wholesale market, a regulated distribution utility, and a population of energy customers, situated in a real location on Earth during a specific period for which weather data is available. The wholesale market is a relatively simple call market, similar to many existing wholesale electric power markets, such as Nord Pool in Scandinavia or FERC markets in North America, but unlike the FERC markets we are modeling a single region, and therefore we do not model location-marginal pricing. Customer models include households and a variety of commercial and industrial entities, many of which have production capacity (such as solar panels or wind turbines) as well as electric vehicles. All have “real-time” metering to support allocation of their hourly supply and demand to their subscribed brokers, and all are approximate utility maximizers with respect to tariff selection, although the factors making up their utility functions may include aversion to change and complexity that can retard uptake of marginally better tariff offers. The distribution utility models the regulated natural monopoly that owns the regional distribution network, and is responsible for maintenance of its infrastructure and for real-time balancing of supply and demand. The balancing process is a market-based mechanism that uses economic incentives to encourage brokers to achieve balance within their portfolios of tariff subscribers and wholesale market positions, in the face of stochastic customer behaviors and weather-dependent renewable energy sources. The broker with the highest bank balance at the end of the simulation wins.

Project-level Governance, Monetary Incentives, and Performance in Strategic R&D Alliances (Doctoral Thesis)

Ozdemir, M.N. — 2011-06-21T00:00:00Z

A growing number of firms rely on strategic R&D alliances to develop new products. In these alliances, firms use various kinds of governance mechanisms for incentive alignment. Project-level governance, i.e., the daily control of alliance activities by firms’ alliance representatives such as steering committee members, alliance managers, and project managers; and, performance-based monetary incentives, i.e., the potential milestone payments tied to the performance of partners, are two governance mechanisms, increasingly used in practice, yet overlooked in the strategic alliances literature. In this dissertation, I examine the antecedents and performance outcomes of these two governance mechanisms in the biopharmaceutical industry setting. The results of this dissertation suggest that project-level governance and monetary incentives offset each others’ effects on alliance innovation performance in the context of startup-incumbent alliances. In other words, offering greater monetary incentives to startups has minimal positive effect on development success, if incumbents opt for intense project-level governance by their controllers at the same time. On the other hand, the results suggest that greater monetary incentives result in higher abnormal stock returns to startup firms following alliance announcements. The results also reveal the positive reciprocal relationship between project-level governance and monetary incentives. The greater the project-level governance, the higher the size of potential milestone-payments, and vice versa. Hence, the incumbents that exercise intense governance on startups in alliances offer also higher potential milestone payments to compensate for the performance risks of startups. The results also show that project-level governance positively influences the contractual detail, which in turn increases the likelihood of development success. Finally, the results reveal several other exogenous and endogenous antecedents of both governance mechanisms.

Towards a Value-based Method for Risk Assessment in Supply Chain Operations (Research Paper)

Liu, L. — 2011-05-30T00:00:00Z

This paper proposes a risk assessment framework as a research road-map, with the aim of developing a protocol that integrates the risk management requirements from the perspectives of the business and the government. We take the viewpoint of value modeling and interpret the risk management problem as a control problem. Four steps of risk assessment are identified in the framework, forming the risk management cycle.

Real-time Tactical and Strategic Sales Management for Intelligent Agents Guided By Economic Regimes (Research Paper)

Ketter, W. — 2011-05-16T00:00:00Z

Many enterprises that participate in dynamic markets need to make product pricing and inventory resource utilization decisions in real-time. We describe a family of statistical models that address these needs by combining characterization of the economic environment with the ability to predict future economic conditions to make tactical (short-term) decisions, such as product pricing, and strategic (long-term) decisions, such as level of finished goods inventories. Our models characterize economic conditions, called economic regimes, in the form of recurrent statistical patterns that have clear qualitative interpretations. We show how these models can be used to predict prices, price trends, and the probability of receiving a customer order at a given price. These “regime” models are developed using statistical analysis of historical data, and are used in real-time to characterize observed market conditions and predict the evolution of market conditions over multiple time scales. We evaluate our models using a testbed derived from the Trading Agent Competition for Supply Chain Management (TAC SCM), a supply chain environment characterized by competitive procurement and sales markets, and dynamic pricing. We show how regime models can be used to inform both short-term pricing decisions and longterm resource allocation decisions. Results show that our method outperforms more traditional shortand long-term predictive modeling approaches.

The Power Trading Agent Competition (Research Paper)

Ketter, W. — 2011-05-10T00:00:00Z

This is the specification for the Power Trading Agent Competition for 2011 (Power TAC 2011). Agents are simulations of electrical power brokers, who must compete with each other for both power production and consumption, and manage their portfolios.

Rescheduling of Railway Rolling Stock with Dynamic Passenger Flows (Research Paper)

Kroon, L.G. — 2010-12-10T00:00:00Z

Traditional rolling stock rescheduling applications either treat passengers as static objects whose influence on the system is unchanged in a disrupted situation, or they treat passenger behavior as a given input. In case of disruptions however, we may expect the flow of passengers to change significantly. In this paper we present a model for passenger flows during disruptions and we describe an iterative heuristic for optimizing the rolling stock to the disrupted passenger flows. The model is tested on realistic problem instances of NS, the major operator of passenger trains in the Netherlands.

Smart Grid Economics: Policy Guidance through Competitive Simulation (Research Paper)

Ketter, W. — 2010-11-11T00:00:00Z

Sustainable energy systems of the future will need more than efficient, clean, low-cost, renewable energy sources; they will also need efficient price signals that motivate sustainable energy consumption as well as a better real-time alignment of energy demand and supply.

MIPLIB Truckload PDPTW Instances Derived from a Real-World Drayage Case (Research Paper)

Srour, F.J. — 2010-10-04T00:00:00Z

This paper describes five sets of 33 Mixed Integer Problem instances each, for a total of 165 instances, derived from a real-world full-truckload pick-up and delivery problem with time windows at the Port of Rotterdam. These instances represent 33 individual days of data encompassing 65 jobs and 40 trucks. We report, in this paper, on the structure of the real-world problem, the mechanism by which the real data was transformed into the test instances, the Mixed Integer Programming formulation used to solve these instances, the results obtained, and sources in the literature describing alternative uses for these instances.

Targeted Advertising and Social Status (Research Paper)

Vikander, N. — 2010-09-01T00:00:00Z

This paper shows how a firm can use non-targeted advertising to exploit consumers' desire for social status. A monopolist sells multiple varieties of a good to consumers who each care about what others believe about his wealth. Advertising allows consumers both to buy different varieties and to recognize them when others buy. In equilibrium, the firm advertises each variety to those who will buy but also to all poorer consumers who will not, so that they understand what having the goods signals. If concern for status is sufficiently high, then the firm will only place a single variety on the market.

The Value of Optimization in Dynamic Ride-Sharing: a Simulation Study in Metro Atlanta (Research Paper)

Agatz, N.A.H. — 2010-08-17T00:00:00Z

Smartphone technology enables dynamic ride-sharing systems that bring together people with similar itineraries and time schedules to share rides on short-notice. This paper considers the problem of matching drivers and riders in this dynamic setting. We develop optimization-based approaches that aim at minimizing the total system-wide vehicle miles and individual travel costs. To assess the merits of our methods we present a simulation study based on 2008 travel demand data from metropolitan Atlanta. The simulation results indicate that the use of sophisticated optimization methods instead of simple greedy matching rules may substantially improve the performance of ride-sharing systems. Furthermore, even with relatively low participation rates, it appears that sustainable populations of dynamic ride-sharing participants may be possible even in relatively sprawling urban areas with many employment centers.

Transition Process and Performance in IT Outsourcing: Evidence from a Field Study and Laboratory Experiments (Doctoral Thesis)

Tiwari, V. — 2010-06-24T00:00:00Z

In this dissertation, complementing the strategic and economic studies on interorganizational relationships and IT outsourcing, we focus on the operational execution challenges inherent in these relationships by examining the transition stage, which starts immediately after contract signing and involves the critical transfer of knowledge, experience and routines related to outsourced activities from client to vendor firm. We focus on the transition stage due to its significance for outsourcing success, its complexity and theoretical richness, and its limited current understanding. Utilizing both a longitudinal field study and laboratory experiments to investigate transition, this dissertation generates important theoretical contributions and practical implications. In the first study (see Chapter 4), adopting a longitudinal perspective, we capture a real-life transition as it unfolds over time between a Utility company (Saturn) and a Global IT vendor (Apollo). Adopting the qualitative data analysis techniques and process theorizing guidelines, we inductively develop, explain and illustrate the transition process model consisting of three phases – transfer, adapt and routinize. For each phase, we illustrate the triggering conditions, key activities and outcomes for progression to the next phase. In the second study (see Chapter 5), building on the findings from the longitudinal qualitative field-study (Chapter 4), we focus on the transfer phase, which represents the most fundamental phase and largely determines the success of not only transition but also overall IT outsourcing relationship. To determine the influence of this phase on transition performance, we develop a novel experiment that captures outsourcing and transition scenarios in the laboratory. Using this experimental setting, we focus on understanding the relationship between transfer mechanisms (i.e. methods used to transfer knowledge, experiences and routines) and transition performance. In this study, we select the three basic and most frequently used transfer mechanisms – observation, training and manual. We find that among the three mechanisms, observation leads to the best performance. In the third study (see Chapter 6), building on the findings from the experiments (in Chapter 5), we focus on strengthening the generalizability of these findings and determining any possible moderating influences. The insights from Chapter 5 reveal that two important variables with potential moderating influence on the relationship between transfer mechanisms and transition performance are: codification and task complexity. We find that both codification and task complexity do have a moderating influence, thereby, further improving our understanding of transition performance.

Business Agility and Information Technology in Service Organizations (Doctoral Thesis)

Oosterhout, M.P.A. van — 2010-06-17T00:00:00Z

Service organizations have to deal with highly uncertain events, both in the internal and external environment. In the academic literature and in practice there is not much knowledge about how to deal with this uncertainty. This PhD dissertation investigates the role and impact of information technologies (IT) on business agility in service organizations. Business agility is a relatively new term defined as the capability of organizations to swiftly change businesses and business processes beyond the normal level of flexibility to effectively manage highly uncertain and unexpected, but potentially consequential internal and external events. Empirical research was carried out via surveys and interviews among managers from 35 organizations in four industries and in three governmental sectors. Four in-depth case studies were carried out within one service organization. The dissertation has six key findings: 1) In many large service organizations business agility is hampered by a lack of IT agility. 2) Organization and alignment of processes and information systems via the cycle of sensing, responding and learning along with the alignment of business and IT are important conditions for improving business agility performance of service organizations. 3) Standardization of IT capabilities and higher levels of data quality support higher levels of business agility of service organizations. 4) Two knowledge management strategies – codification and personalization -- are identified that can be used to respond to events with different degrees of uncertainty. A codification knowledge management strategy supports the response to events with low levels of uncertainty by exploiting explicit knowledge from organizational memory. A personalization knowledge management strategy drives the response to events with high levels of uncertainty by exploitation of tacit knowledge and social capital. 5) Social capital is an important moderating variable in the relation between IT capabilities and business agility. Social capital can mitigate the lack of IT agility that exists in many service organizations by overcoming information system boundaries and rigidities via human relationships. 6) The combination of sensing, responding and learning capabilities is required to increase all dimensions of business agility performance. Overall, this research introduces a new approach to analyze and measure business agility. This thesis takes the first steps to develop theoretical knowledge on the conditions under which IT supports higher levels of business agility and business agility performance.

Intelligent Personalized Trading Agents that facilitate Real-time Decisionmaking for Auctioneers and Buyers in the Dutch Flower Auctions (Research Paper)

Ketter, W. — 2010-05-02T00:00:00Z

In this case the Dutch Flower Auctions (DFA) are discussed. The DFA are part of the supply network in which flowers are produced, stocked, and then sold through either mediation or auctioning. This case focuses on the buyers’ and auctioneers’ positions when flowers are traded through auctions. This case deals with the application of personalized agents as part of a Decision Support System which empowers the decision maker. The decision makers discussed in this case are the auctioneers who control the auction process, and the buyers who bid at the clock auction. Agents are defined as software programs that sense their environment and react autonomously on their environment in order to maximize a certain outcome. The agents, as envisioned in this case, are able to determine users’ preferences and based on these preferences agents can proactively make recommendations. Agents as applied to the auction process could empower the auctioneers in their decisions. Another type of agent could empower the buyer, since buyers have the high-pressure task of buying at the clock auction.

From closed-loop to sustainable supply chains: the WEEE case (Article)

Quariguasi Frota Neto, J. — 2010-01-01T00:00:00Z

The primary objective of closed-loop supply chains (CLSC) is to improve the maximum economic benefit from end-of-use products. Nevertheless, the literature within this stream of research advocates that closing the loop also helps to mitigate the undesirable environmental footprint of supply chains. Therefore, closed-loop supply chains are assumed to be sustainable supply chains almost by definition. In this paper we analyse if and when this assumption holds. We illustrate our findings based on the Electric and Electronic Equipment (EEE) supply chain. For all phases of the supply chain, i.e. manufacturing, usage, transportation and end-of-life activities, we assess the magnitude of the environmental impacts, based on a single environmental metric, namely the Cumulative Energy Demand (CED). Given the environmental hot-spots in the Electric and Electronic Equipment supply chain, we propose useful extensions for existing CLSC optimisation models to ensure that closed-loop supply chains are at the same time sustainable supply chains.

Signaling quality through prices in an oligopoly (Article)

Janssen, M.C.W. — 2010-01-01T00:00:00Z

Firms signal quality through prices even if the market structure is very competitive and price competition is severe. In a symmetric Bertrand oligopoly where products may differ only in their quality and each firm's product quality is private information (unknown to consumers and to other firms), there exist symmetric fully revealing perfect Bayesian equilibria where low quality firms randomize over an interval of prices and high quality firms charge high prices. Signaling requires that the market power and rent of low quality firms be large enough and often this requires that high quality firms exercise sufficient market power. There is a unique symmetric fully revealing equilibrium satisfying the D1 criterion; in this equilibrium too, both low and high quality firms may exhibit considerable market power. Market power of high quality firms may persist even as the number of firms becomes arbitrarily large. Every D1 equilibrium involves some revelation of information.

Flexible decision support in dynamic inter-organisational networks (Article)

Collins, J. — 2010-01-01T00:00:00Z

An effective Decision Support System (DSS) should help its users improve decision making in complex, information-rich environments. We present a feature gap analysis that shows that current decision support technologies lack important qualities for a new generation of agile business models that require easy, temporary integration across organisational boundaries. We enumerate these qualities as DSS Desiderata, properties that can contribute both effectiveness and flexibility to users in such environments. To address this gap, we describe a new design approach that enables users to compose decision behaviours from separate, configurable components, and allows dynamic construction of analysis and modelling tools from small, single-purpose evaluator services. The result is what we call an ‘evaluator service network’ that can easily be configured to test hypotheses and analyse the impact of various choices for elements of decision processes. We have implemented and tested this design in an interactive version of the MinneTAC trading agent, an agent designed for the Trading Agent Competition for Supply Chain Management.

A Multi-Agent Energy Trading Competition (Research Paper)

Block, C.A. — 2009-11-25T00:00:00Z

The energy sector will undergo fundamental changes over the next ten years. Prices for fossil energy resources are continuously increasing, there is an urgent need to reduce CO2 emissions, and the United States and European Union are strongly motivated to become more independent from foreign energy imports. These factors will lead to installation of large numbers of distributed renewable energy generators, which are often intermittent in nature. This trend conflicts with the current power grid control infrastructure and strategies, where a few centralized control centers manage a limited number of large power plants such that their output meets the energy demands in real time. As the proportion of distributed and intermittent generation capacity increases, this task becomes much harder, especially as the local and regional distribution grids where renewable energy generators are usually installed are currently virtually unmanaged, lack real time metering and are not built to cope with power flow inversions (yet). All this is about to change, and so the control strategies must be adapted accordingly. While the hierarchical command-and-control approach served well in a world with a few large scale generation facilities and many small consumers, a more flexible, decentralized, and self-organizing control infrastructure will have to be developed that can be actively managed to balance both the large grid as a whole, as well as the many lower voltage sub-grids. We propose a competitive simulation test bed to stimulate research and development of electronic agents that help manage these tasks. Participants in the competition will develop intelligent agents that are responsible to level energy supply from generators with energy demand from consumers. The competition is designed to closely model reality by bootstrapping the simulation environment with real historic load, generation, and weather data. The simulation environment will provide a low-risk platform that combines simulated markets and real-world data to develop solutions that can be applied to help building the self-organizing intelligent energy grid of the future.

Standardisation as a Catalyst for Innovation (Inaugural Lecture)

Blind, K. — 2009-08-28T00:00:00Z

Het traditionele beeld dat standaardisatie gezien wordt als een proces dat niet samengaat met innovatie is de laatste jaren veranderd. In zijn oratie laat prof.dr. Knut Blind zien dat vastgestelde normen wel degelijk kunnen bijdragen aan vernieuwingen. Vanuit economisch perspectief behandelt Blind het potentieel en de impact van standaardisatie en normen op innovatiemogelijkheden, waarbij hij mogelijke negatieve effecten niet onbesproken laat. Eerste onderwerp is het nut van standaardisatie voor onderzoek binnen de technologie. Vervolgens gaat Blind in op de wisselwerking tussen het intellectuele eigendomsrecht, voornamelijk patenten, en standaarden. Hij stelt dat de integratie van patenten in standaarden leidt tot een versnelling van technologische kennis, maar dat er gevaar is dat bedrijven hier ook misbruik van kunnen maken. Prof.dr. Knut Blind concludeert zijn oratie met een visie op de uitdagingen van toekomstig onderzoek.
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Traditionally, standards have been perceived as contradicting innovation. However, this view has been overturned in recent years. Based on some fundamental definitions and an illustration of the generic economic effects of standards, the inaugural address will present the innovation-promoting impacts of standards in three different dimensions. In addition, possible barriers for the exploitation of these potentials and negative implications of the interaction between innovation and standardisation will also be examined. First, Blind will address the relationship between research and standardisation. The role of standardisation and standards as effective channels of technology transfer will be outlined. Additionally, the relevance of standards for research activities will be illustrated. Second, he will address the interaction between intellectual property rights, especially patents, and standards. Here, the integration of patents into standards broadens and fastens the diffusion of technological know-how. However, this interaction might be misused for strategies leading to a vicious and not-virtuous circle. Finally, standards can also play an innovation-promoting role in the procurement of innovative products. Here, Blind will focus on the potential of standards for innovation oriented public procurement policies, but also outline actual problems. The address will close with an outlook to future research challenges.

Multi-Agent Systems for Transportation Planning and Coordination (Doctoral Thesis)

Moonen, J.M. — 2009-06-25T00:00:00Z

Many transportation problems are in fact coordination problems: problems that require communication, coordination and negotiation to be optimally solved. However, most software systems targeted at transportation have never approached it this way, and have instead concentrated on centralised optimisation. Multi-agent systems (MAS) are a different approach to building software systems. Such systems are assembled from autonomously interacting agents; agents are small software programs, which have some type of intelligence and individual behaviour. Communication and coordination (between agents) are the essential elements in the construction of MAS. The transportation domain is often referred to as a potential candidate for the application of MAS. In this dissertation, we discuss two MAS design cases related to the transport of containers. Both cases resulted in concrete prototypes, which let us evaluate a series of aspects important in applying MAS in transportation. We demonstrate the importance of a multi-method validation and evaluation approach. The prototypes were furthermore utilised as artefacts to discuss eventual implementation with future users and experts. One of our most important observations is that planning, as a function within supply chains, is about to go through a fundamental change. Like the mobile phone changed the way people coordinate in daily life, the concepts discussed in this dissertation have the potential to fundamentally change coordination in supply chains. As part of this fundamental change, a different perspective on certainty and uncertainty is essential.

Language Selection Policies in International Standardization – Perception of the IEC Member Countries (Research Paper)

Teichmann, H. — 2009-06-02T00:00:00Z

International standards setting organizations have different language selection policies. These policies have, besides their financial aspects, also an important cultural/ political dimension. The standards setting organizations are either bilingual (English/ French), or unilingual (English), or multilingual (English, French and further languages). We have investigated the references of the 65 national members of the International Electrotechnical Commission (IEC). The main findings are a moderate preference for the use of both English and French for the technical work, and a strong preference for the use of English only for communication.. The obvious dominance of the English language is seen as a necessity, rather than an indication of a hypothetical Anglo-American linguistic/ cultural imperialism. Finally, some conclusions regarding language selection policies in international standards setting organizations are presented.