OR at P&G

Let me be late in the OR blogging game and note that there is a great article on operations research at Proctor and Gamble on bnet. It is wonderful advertising for our field, including phrases like “P&G’s Killer Apps in OR”. INFORMS was strongly involved in the article, with quotes from Past-President Brenda Dietrich and Executive Director Mark Doherty:

P&G, GE, Merrill Lynch, UPS — the list of Fortune 500 companies getting into the OR game is expanding, says Mark Doherty, executive director of the Hanover, MD-based Institute for Operations Research and Management Sciences (INFORMS), an OR think tank. “In the private sector, OR is the secret weapon that helps companies tackle complex problems in manufacturing, supply chain management, health care, and transportation,” he says. “In government, OR helps the military create and evaluate strategies. It also helps the Department of Homeland Security develop models of terrorist threats. That’s why OR is increasingly referred to as the ‘science of better.’”

Having sat in on a few too many board meetings, I think calling INFORMS an “OR think tank” is going a little far. But the article does project the very best vision of our field.

Check out another take on the article at Punk Rock Operations Research (and I thought I saw it on another OR blog, but it escapes me at the moment).

Soo-Haeng Cho and the Influenza Vaccine

I’ve been back in the US for about six weeks now, and am getting used to being back in my academic life. A sign of the slowness of this transition, however, is that our operations management group here at the Tepper School is hiring a junior faculty person, and I didn’t notice, so I have missed most of the job talks. I feel bad about that: the best part of hiring is seeing the best new research from around the world.

Lasts week, Soo-Haeng Cho interviewed here (and did very well by all reports). Soo-Haeng works in a number of areas of operations management, including the use of OM methods in medical decisions. He has a very nice paper on choosing the correct flu vaccine each year. This issue has been in the news recently (including CNN ) because the current vaccine is missing quite a few of the flu bugs. Cho’s paper talks about many of the issues that go into the choice of vaccine, not all of which are reasonably covered by the popular press. In particular, I hadn’t realized the strong advantage of doing the same as last year in terms of getting reliable vaccines out to people.  From his paper:

The production yields of strains are variable and unknown owing to its biological characteristic (Matthews 2006). Moreover, yield uncertainty is increased significantly when a vaccine strain is changed. The magnitude of this challenge is illustrated in the following quote from an industry representative (Committee
2003):
“certainly the best way to ensure this predictability of supply is not to recommend any [strain] changes, … a second best way is to minimize the number of strain changes. Each new strain can yield anywhere from 50 to 120 percent of the average strain.”
Thus, even if a new virus strain is predominant, a change is made only when the benefit from improved efficacy outweighs the risk associated with making the change in production. For instance, although new A/Fujian-like virus strains were widely spreading during the 2002-3 season, the Committee did not select
that strain because it was not suitable for large-scale manufacturing.

It is clear that understanding the medical decision making requires the understanding of manufacturing operations, which I think is a great theme in the upcoming years for our field.

Summary of Quantum Computing

Scott Aaronson, whose writings I both admire and am jealous of, has an article in the month’s Scientific American on the limits of quantum computing.  He has posted a preliminary version of the paper on his site.  I found this extremely useful in trying to make sense of what quantum computing can and can’t do.  It is a shame the writers at SlashDot don’t read the paper before making the comments showing their confusions!

Death of Mike Rothkopf

Mike Rothkopf, former president of INFORMS, died while swimming on the campus of Penn State.

A regular natatorium patron, the 68-year-old supply chain information systems professor appeared to be “just relaxing” — floating on his back — when concerned lifeguards tapped him on the shoulder at about 8 a.m. yesterday, said Tom Griffiths, manager of aquatic facilities.

Three student lifeguards and three professional staff members attempted to revive the unresponsive Rothkopf using an automated external defibrillator and mouth-to-mouth resuscitation, Griffiths said. Rothkopf was pronounced dead at Mount Nittany Medical Center at about 9:15 a.m. His cause of death was unknown by press time yesterday, the hospital’s nurse supervisor said.

Mike had recently moved to Penn State after a long career at Rutgers. A former editor of Interfaces, Mike was passionate about the need for academics and practitioners in our field to communicate more and have more (and better) interactions. He was a tremendous force in our field, and will be sorely missed for his insights, his common-sense, and the wisdom he gained throughout his career.

 

Edelman Finalists Announced

The finalists for the 2008 Franz Edelman Award for Achievement in Operations Research and the Management Sciences have been announced. The Edelman Awards are a big thing in OR. The prize is given to the best use of operations research in practice. Even getting to be a finalist is a lot of work: this is not just a matter of submitting a paper and seeing how it goes. The finalists have to work even harder. They need to prepare a highly professional presentation, with the best presentations getting the support of a firm’s very top management (one year, the South African defense department was a finalist, and President Mandela provided a letter of support). Each finalists is assigned a coach to help them prepare their presentation (the late Rick Rosenthal was proud of the role he played as a coach, and I think finalists working with him may have had a bit of an advantage). And the projects have to be real, not hypothetical. Without verifiable and significant effect, a project cannot be a finalist, let alone a winner.

INFORMS has jazzed up the competition quite a bit in the last years, with fancy presentations at the Practice Meeting. I think this is great: these projects save, often, hundreds of millions of dollars, or improve many lives. They deserve a celebration.

This year’s finalists are an interesting bunch:

1. Federal Aviation Administration, for a project entitled “Airspace Flow Programs,” which gives the FAA greater ability to control the nation’s skies at times of peak consumer usage and flight congestion.

2. Netherlands Railways, for “The New Dutch Timetable: The O.R. Revolution,” a solution that improved on-time performance and capacity for more than a million daily train passengers.

3. StatoilHydro, one of the world’s largest gas producers, and Gassco, the independent Norwegian network operator, for “Optimizing the Offshore Pipeline System for Natural Gas in the North Sea.”

4. The City of Stockholm, Sweden for “Operations Research (O.R.) Improves Quality and Efficiency in Social Care and Home Help,” a program that has brought improvements to the complex scheduling of more than 4,000 providers who help the sick and the elderly.

5. U.S. Environmental Protection Agency, for “Reducing Security Risks in American Drinking Water Systems.”

6. Xerox, for “LDP Lean Document Production® – Dramatic Productivity Improvements for the Printing Industry,” which has bettered production and reduced costs for print shops and document manufacturers. The total impact to date on Xerox profits from the utilization of the LDP is about $200M. Xerox has filed 48 patents on this methodology and so far 11 have issued.

That’s three international organizations and only one traditional manufacturing finalist. The Swedish finalist in particular represents a strong trend in OR: using OR in the service sector.

I am looking forward to seeing the presentations at the Practice Meeting.

A Good List to be On

Sandy Holt of Systems Analysis and Planning, Inc. (and one of my contacts on LinkedIn) wrote to let me know that “operations research analyst” was one of the careers on MSN’s list of “Ten Jobs that pay more than $30/hour”, albeit on the list at number 10 with a median salary of $31.08/hour ($64,650/year). The description of OR analyst isn’t bad:

Operations research analysts are brought into businesses and organizations to identify, investigate and solve logistics problems through the use of statistical analysis and computer programs. The type of problems can vary depending on the nature of the business, whether it’s a production factory or the military.

I find “logistics problems” and the misleading phrase “computer programs” a bit problematical, but it is not the worse description I have seen.

Feb 10:  Did I really not include a pointer to the article?  It is here.

Andy Boyd, Pricing, and “The Engines of Our Ingenuity”

Andy Boyd, formerly chief scientist of PROS (he is actually still on their scientific board, but is not an active employee) visited CMU today as part of our CART (Center for Analytical Research in Technology) seminar series. He talked about the challenges those in pricing research face. The main point he made is that it is very difficult to figure out demand curves (hence elasticity of demand) through data. Having even lots and lots of transaction level data doesn’t help much in generating demand curves. This is not a new insight (economists refer to these sorts of issues as “identification problems”) but it was interesting to hear this from someone who has made a living doing pricing for the last decade. Without demand curves, how can pricing be done? Airlines have enough separate flights (for which you can assume no substitution) to do a fair amount of experimentation. How can other areas get similar data? Further, Andy makes the point that without understanding the sales process, it is impossible to interpret any data. For instance, for a given kind of car, there will be a few sales at a low value, lots of sales at a medium value, and a few sales at a high value. This does not mean that the demand for cars goes up then down as a function of price! Since car prices are generally negotiated, only a few of the best negotiators will get the lowest price.

Andy makes a strong case that operations research needs to be applied more in the entire sales domain, from customer segmentation through pricing to negotiation. The lack of underpinning in something as fundamental as a demand curve is a little disconcerting, but he stressed for many markets (those without “posted prices”), demand curves may be the wrong modeling approach in the first place.

Andy is now “semi-retired” (I guess he did well when PROS went public) but certainly seems to have lots going on. Once a week, he does a radio show on the Houston public radio radio station. The show is called Engines of Our Ingenuity and Andy does his version on Thursdays. The transcripts are available for the shows. Andy is normally referred to as “guest scientist” but he is sometimes called “operations researcher”, which makes me happy. A recent show of his was on operations research legend George Dantzig, concentrating on his development of the simplex algorithm and his lack of Nobel Prize. Other episodes involve the four color theorem, mathematical models, parallel computing, and operations research itself, along with much, much more. John Lienard is the driving force behind The Engines of Our Ingenuity.

Also, Andy has a new book out on pricing entitled The Future of Pricing: How Airline Ticket Pricing has Inspired a Revolution. Andy and I go back more than twenty years: it was great to see him and see all the amazing things he is doing, even if he is “semi-retired”.

Call for Short Papers, CP-AI-OR 2008

I am co-program chair for CP-AI-OR 2008 to be held in May in Paris.  This year, we decided to allow “short papers” primarily to encourage presentation of preliminary work or work that might have appeared in another outlet but would still be of interest to the CP-AI/OR community.  If you aren’t familiar with CP-AI/OR, it is a small (roughly 100 person) conference that brings together people in constraint programming and operations research to discuss issues in common in the two field (I actually put constraint programming as part of operations research, but most constraint programmers don’t agree with me).

The deadline for short papers is February 15.  You can check out more details at the conference web site.