Decision, Operations & Information Technologies
Permanent URI for this communityhttp://hdl.handle.net/1903/2230
Prior to January 4, 2009, this unit was named Decision & Information Technologies.
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Item The Transformational Role of IT in Entrepreneurship: Crowdfunding and the Democratization of Access to Capital and Investment Opportunity(2014) Kim, Keongtae; Hann, Il-Horn; Viswanathan, Siva; Business and Management: Decision & Information Technologies; Digital Repository at the University of Maryland; University of Maryland (College Park, Md.)My dissertation examines the strategic impacts of IT-enabled platforms on entrepreneurial and innovation activities. Specifically, I explore the behaviors of both investors and entrepreneurs in online crowdfunding markets that have the potential to democratize access to capital and investment opportunities. In my first essay, I examine the role of experts in a crowdfunding market. While conventional wisdom considers a crowdfunding market as a mechanism to democratize decision making and reduce reliance on experts, I find that experts still play a pivotal role in these markets. In particular, I find that the early investments by experts serve as credible signals of quality for the crowd, and have a significant impact on the crowd's investment decisions. In my second essay, I analyze whether crowdfunding democratizes access to capital for entrepreneurs. I find that difficult access to credit from traditional sources induces entrepreneurs to rely more on crowdfunding as a viable alternative, while this effect varies across project types and across areas. In each essay, I analyze micro-level data from online crowdfunding markets with a variety of econometric methods. The results have important theoretical and practical implications for questions ranging from the design of online crowdfunding markets to competition between online and offline channels for funding and regional dynamics of crowdfunding.Item Problems and Models in Strategic Air Traffic Flow Management(2013) Swaroop, Prem; Ball, Michael O; Business and Management: Decision & Information Technologies; Digital Repository at the University of Maryland; University of Maryland (College Park, Md.)The thesis comprises of three essays. The first essay is titled "Do more US airports need slot controls? A welfare based approach to determine slot levels." It analyzes the welfare effects of slot controls on major US airports. We consider the fundamental trade-off between benefits from queuing delay reduction and costs due to simultaneous schedule delay increase to passengers while imposing slot limits at airports. A set of quantitative models and simulation procedures are developed to explore the possible airline scheduling responses through reallocating and trimming flights. We find that, of the 35 major US airports, a more widespread use of slot controls would improve travelers' welfare. The results from our analyses suggest that slot caps at the four airports that currently have slot controls (Washington Reagan, Newark, New York LaGuardia, New York John F. Kennedy) are set too high. Further slot reduction by removing some of the flights at these airports could generate additional benefits to passengers. Slot controls can potentially reduce two thirds of the total system delays caused by congestion. A number of implementation and design issues related to the use of slot controls are also discussed in the paper. The second essay is titled "Designing the Noah's Ark: A Multi-objective Multi-stakeholder Consensus Building Method." A significant challenge of effective air traffic flow management (ATFM) is to allow for various competing airlines to collaborate with an air navigation service provider (ANSP) in determining flow management initiatives. This challenge has led over the past 15 years to the development of a broad approach to ATFM known as collaborative decision making (CDM). A set of CDM principles has evolved to guide the development of specific tools that support ATFM resource allocation. However, these principles have not been extended to cover the problem of providing strategic advice to an ANSP in the initial planning stages of traffic management initiatives. In the second essay, we describe a mechanism whereby competing airlines provide ``consensus'' advice to an ANSP using a voting mechanism. It is based on the recently developed Majority Judgment voting procedure. The result of the procedure is a consensus real-valued vector that must satisfy a set of constraints imposed by the weather and traffic conditions of the day in question. While we developed and modeled this problem based on specific ATFM features, it appears to be highly generic and amenable to a much broader set of applications. Our analysis of this problem involves several interesting sub-problems, including a type of column generation process that creates candidate vectors for input to the voting process. The third essay is titled "Strategic Opportunity Analysis in COuNSEL -- A Consensus-Building Mechanism for Setting Service Level Expectations." The consensus-building mechanism described in the second essay has been accepted as a technically viable solution for the stated problem -- although many practical challenges still remain before it may be deployed in operations. A key issue worthy of further investigation is its strong strategy-resistance -- as claimed by the authors of Majority Judgment, the voting procedure embedded in COuNSEL. Using the broad ideas of Nash Equilibria, we characterize the necessary and sufficient conditions for an airline to benefit from unilaterally deviating from truthfully grading one or more candidates. The framework provides the airline with all the other airlines' grades on a set of candidates, and allows it an opportunity to present new grades. The analysis is repeated over multiple instances, and likelihood of beneficial strategic opportunity is presented.Item INSTITUTIONAL LOGICS, INDIE SOFTWARE DEVELOPERS AND PLATFORM GOVERNANCE(2013) Qiu, Yixin; Gopal, Anandasivam; Hann, Il-Horn; Business and Management: Decision & Information Technologies; Digital Repository at the University of Maryland; University of Maryland (College Park, Md.)This two-essay dissertation aims to study institutional logics in the context of Apple's independent third-party software developers. In essay 1, I investigate the embedded agency aspect of the institutional logics theory. It builds on the premise that logics constrain preferences, interests and behaviors of individuals and organizations, thereby determining the appropriate and legitimate decisions and actions of actors. In the meantime, most social actors operate in fields characterized by multiple institutional logics where contradictions exist, allowing individuals and organizations with opportunities for negotiation and change through exploitation or management of these contradictions. I specifically study two competing institutional logics: professional and market logics when they are experienced simultaneously by independent iOS app entrepreneurs. Using participant observation and semi-structured interviews, I delineate the ways in which logic tension is reconciled through mechanisms of logic synthesis in three entrepreneurial areas - app ideation, app execution and app marketing, and conditions which facilitate or inhibit logic synthesis. In essay 2, I study the emergence and evolution of field-level logics in the context of Apple's desktop developers - Mac indies. Following the cultural emergence model of field-level logics in Thornton et al. (2012), and the argument that "field-level logics are both embedded in societal-level logics and subject to field-level processes that generate distinct forms of instantiation, variation, and combination of societal logics" (p148), I particularly examine the relationship between resource environment and the emergence and evolution of field-level logics. Taking advantage of a critical change in developers' resource environment - Apple's opening of the iOS App Store and subsequently the Mac App Store, and hence its governance model shifting from mainly a technological platform to a platform that includes a market exchange place, I identify developers' logics before and after the change, namely, the software ecosystem logic and platform ecosystem logic. Two ideal types are constructed for the logics along elemental categories, and a content analysis demonstrates the logic shift pattern as resource environments change. A further analysis of the two logics suggests that the software ecosystem logic and platform ecosystem logic are in contestation at this early stage of institutional change.Item INFORMATION TRANSPARENCY AND USER BEHAVIOR IN EMERGING ONLINE MARKETPLACES: EMPIRICAL STUDIES OF SOCIAL MEDIA AND OPEN INNOVATION MARKETS(2013) AL-HASAN, ABRAR; Viswanathan, Siva; Lucas, Hank; Business and Management: Decision & Information Technologies; Digital Repository at the University of Maryland; University of Maryland (College Park, Md.)Web 2.0 and social media have significantly increased the amount of information available to users not only about firms and their offerings, but also about the activities of other individuals in their networks and markets. It is widely acknowledged that this increased availability of information is likely to influence a user's behavior and choices. However, there are very few systematic studies of how such increased information transparency influences user behavior in emerging marketplaces. My dissertation seeks to examine the impact of increased information transparency - particularly, information about other individuals - in two emerging platforms. The first essay in my dissertation compares online "social" marketing on Facebook with "non-social" marketing and examines their relative impacts on the likelihood of adoption, usage and diffusion of an "App". While social marketing - wherein a user gets to see which of her other friends have also "liked" the product being marketed- is one of the fastest growing online marketing formats, there are hardly any studies that have examined the value of the social aspect of such marketing. I find that social marketing is associated with increased app adoption, usage, and diffusion as compared to non-social marketing. The study also uncovers interesting tradeoffs between the effects of different types of "social" information on user behavior outcomes. The second essay examines the behavior of contestants in an open innovation design marketplace, wherein firms seek solutions from a crowd through an online contest. The study examines how the availability of information about other contestants as well as the availability of feedback information provided to others by the contest holder, impacts a focal contestant's behavior and outcomes. I find that contestants adopt different strategic behaviors that increase their odds of winning the contest under the different information-transparency regimes. The findings have interesting implications for the design of online contests and crowdsourcing markets. Overall, my dissertation provides a deeper understanding of how the visibility of different types of information in online platforms impacts individual behaviors and outcomes.Item Essays on Information Flows and Auction Outcomes in Business-to-Business Market: Theoretical and Empirical Evidence(2013) Pilehvar, Ali; Elmaghraby, Wedad; Gopal, Anandasivam; Business and Management: Decision & Information Technologies; Digital Repository at the University of Maryland; University of Maryland (College Park, Md.)In this dissertation, I have three separate essays in the context of Business-to Business (B2B) auctions; in each I introduce a complex problem regarding the impact of information flows on auction's performance which has not been addressed by prior auction literature. The first two essays (Chapter 1 and 2) are empirical studies in the context of online secondary market B2B auctions while the third essay (Chapter 3) is a theoretical investigation and will contribute to the B2B procurement auction literature. The findings from this dissertation have managerial implications of how/when auctioneers can improve the efficiency or success of their operations. B2B auctions are new types of ventures which have begun to shape how industries of all types trade goods. Online B2B auctions have also become particularly popular for industrial procurement and liquidation purposes. By using online B2B auctions companies can benefit by creating competition when auctioning off goods or contracts to business customers. B2B Procurement auctions− where the buyer runs an auction to procure goods and services from suppliers− have been documented as saving firms millions of dollars by lowering the cost of procurement. On the other hand, B2B auctions are also commonly used by sellers in `secondary market' to liquidate the left-over goods to business buyers in a timely fashion. In order to maximize revenues in either both industrial procurement or secondary market settings, auctioneers should understand how the auction participants behave and react to the available market information or auction design. Auctioneers can then use this knowledge to improve the performance of their B2B auctions by choosing the right auction design or strategies. In the first essay, I investigate how an online B2B secondary market auction environment can provide several sources of information that can be used by bidders to form their bids. One such information set that has been relatively understudied in the literature pertains to reference prices available to the bidder from other concurrent and comparable auctions. I will examine how reference prices from such auctions affect bidding behavior on the focal auction conditioning on bidders' types. I will use longitudinal data of auctions and bids for more than 4000 B2B auctions collected from a large liquidator firm in North America. In the second essay, I report on the results of a field experiment that I carried out on a secondary market auction site of another one of the nation's largest B2B wholesale liquidators. The design of this field experiment on iPad marketplace is directly aimed at understanding how (i) the starting price of the auction, and (ii) the number of auctions for a specific (model, quality), i.e., the supply of that product, interact to impact the auction final price. I also explore how a seller should manage the product differentiation so that she auctions off the right mix and supply of products at the reasonable starting prices. Finally, in the last essay, I study a norm used in many procurement auctions in which buyers grant the `Right of First Refusal' (ROFR) to a favored supplier. Under ROFR, the favored supplier sees the bids of all other participating suppliers and has the opportunity to match the (current) winning bid. I verify the conventional wisdom that ROFR increases the buyer's procurement cost in a single auction setting. With a looming second auction in the future (with the same participating suppliers), I show that the buyer lowers his procurement cost by granting the ROFR to a supplier. The analytical findings of this essay highlights the critical role of information flows and the timing of information-release in procurement auctions with ROFR.Item ONLINE NETWORKS AND PROSOCIAL BEHAVIORS: EMPIRICAL STUDIES OF CHARITABLE DONATIONS AND ENVIRONMENTAL SUSTAINABILITY(2013) Yim, Dobin; Viswanathan, Siva; Lucas, Hank C; Business and Management: Decision & Information Technologies; Digital Repository at the University of Maryland; University of Maryland (College Park, Md.)My dissertation seeks to understand how online networks promote prosocial behaviors in creating social value. The first essay examines the use of Twitter on charitable giving behavior in online fundraising campaigns. Using a unique dataset from one of the first nonprofit organizations to conduct an online fundraising campaign via Twitter, the goal of this essay is to understand how social media and the interpersonal communications it facilitates influences donation outcomes. I find that generic content sent through a mass broadcast mode has a negative influence, whereas personalized content sent through a narrowcast mode has a positive influence on a focal agent's donation behavior. I further show that different types of persuasive content have varied impacts on outcomes. In the interpersonal context, content related to maintaining social relationships such as the visibility of other members' donations, the diversity of sources advocating action, and strengthening interpersonal bonds, positively influence donation behavior, especially for those whose social ties with the charitable organization are weak. The second essay examines the design of online communities in supporting grassroots movements towards environmental sustainability. Using a dataset from one of the early pioneers of "green" online communities, the goal of this essay is to understand how online networks impact sustainable behaviors. Drawing from literature on observational learning and environmental sustainability, I show that a member's total carbon savings is mainly influenced by the exposure to relevant others' "green" behaviors. More specifically, a member's decision to commit and perform a sustainable act is determined by the organizational structure and strength of relationships with fellow members. While organizing members into groups decreases individual's environmental effectiveness in terms of total carbon savings, especially in larger groups, a higher frequency of communications among members increases sustainable behavior by enhancing interpersonal connections. Overall, the two studies provide important theoretical and practical implications for prosocial behaviors supported by online networks.Item POKES, PRODS, AND PUSHES: INFORMATION AVAILABILITY AND DECISION MAKING IN AMBIGUOUS ENVIRONMENTS(2013) Greenwood, Brad N.; Agarwal, Ritu; Gopal, Anand; Business and Management: Decision & Information Technologies; Digital Repository at the University of Maryland; University of Maryland (College Park, Md.)In this dissertation I investigate how changes in the availability of information influences decision making in inherently ambiguous environments. As the Internet has not only fostered connectivity, but also catalyzed information generation on an unprecedented scale, my objective is to revisit the concept of information availability and salience in the digital age. I conduct my empirical analysis in the contexts of entrepreneurship and healthcare, which are significant both theoretically as well as in terms of economic and public welfare. In essay one, I examine how rising perceptions of fashion, viz., increased media coverage and herding, influence the willingness of venture capitalists to fund non-co-located entrepreneurs. This essay contributes to extant theory on entrepreneur-VC co-location by identifying the effect that social trends, as opposed to factors which are native only to the focal entrepreneur, can have on the willingness to venture capitalists to fund non-co-located entrepreneurs. In essay two, I explore the interplay between the broadcast and social media, as well as the ability of these media to incentivize firm formation on the part of nascent entrepreneurs. Applying the lens of agenda setting theory I demonstrate that the social media will moderate the impact of the broadcast media when entrepreneurs and financiers seek to found and fund new ventures. This study augments existing literature by considering not only the intensity of non-novel information, but also how participation will impact decision making. The third essay investigates a persistent puzzle in the medical literature: how different physicians react to medical guideline release (i.e. the release of new and novel information) which call into question the efficacy of long standing treatment options. Situating this essay within two theoretical tensions in the literature, the trade-off between agility and routines and the debate between costless and costly information assimilation, I find that while physicians are discerning in their reaction to new information their reactions are not quick, creating significant public welfare deficits. Moreover, I find that physician characteristics, such as tenure, board certification, and freelancer status, significantly moderate physician response to new guidelines. Taken together these essays contribute to the literature on Information Systems and Strategic Management by augmenting understanding of the construct of information availability, and how it affects decision makers in ambiguous environments.Item RECIPROCITY IN ONLINE MARKETS: EMPIRICAL STUDIES OF AUCTION AND BARTER MARKETS(2013) Ye, Shun; Viswanathan, Siva; Hann, Il-Horn; Business and Management: Decision & Information Technologies; Digital Repository at the University of Maryland; University of Maryland (College Park, Md.)My dissertation seeks to understand how reciprocity affects transaction outcomes and mechanism design in online markets. The first essay examines negative reciprocity illustrated as feedback-revoking behavior in the eBay auction market, focusing on its impact and implications for reputation system design. I utilize the biggest policy change of eBay's reputation system in its history as a natural experiment setting to infer the causal impact of the reputation system on seller behavior. I find that strategic engagement in negative reciprocity enables low quality sellers to manipulate their reputations and masquerade as high-quality sellers. I further show that these sellers react strongly to eBay's announcement of a ban on revoking. Interestingly, disallowing negative reciprocity motivates these sellers to significantly improve their service quality. The second essay examines positive reciprocity in one of the leading online barter markets for books, focusing on participants' different reciprocity strategies and their impacts on transaction outcomes. I find that, whereas market participants who use the immediate reciprocity strategy are able to motivate higher service quality for the current transaction from the other partner, participants who use the delayed reciprocity strategy derive more benefits for future transactions by fulfilling their wishlists sooner. I further show that the market participants can be segmented into different reciprocity strategies based on their book avidness, breadth of interest, and psychographic profiles. Overall, the two studies provide important theoretical and practical implications for the design and regulation of online markets.Item Integrating Social Network Effects in Product Design and Diffusion(2012) Gunnec, Dilek; Raghavan, Subramanian; Business and Management: Decision & Information Technologies; Digital Repository at the University of Maryland; University of Maryland (College Park, Md.)Connectivities among people are amplified with recent advancements in internet technology increasing the number of communication channels. Information spread over these networks strengthen the social influence among individuals and affect their purchasing decisions. In this thesis, we study three problems in the product design and diffusion context by integrating such social network effects where influence takes place over neighborhood relationship ties among the users of the product. We consider the setting where peer influence plays a significant role in a consumer's product choice or there is a tangible benefit from using the same product as the rest of one's social network. Building upon the well-known Share-of-Choice problem, we model an influence structure and define the Share-of-Choice problem with Network Effects. It is an NP-Hard combinatorial optimization problem which we solve using a Genetic Algorithm. Using simulated data we show that ignoring social network effects in the design phase of a product results in a significantly lower market share for a product. Our genetic algorithm obtains near-optimal solutions and is very robust in terms of its running time, scalability, and ability to adapt to additional constraints/variations of the model. In this setting, we introduce a product diffusion problem, the Least Cost Influence Problem, which increases the market share of a product by intervening the natural diffusion of it over the social network. This intervention is in the form of incentive supply to a group of people in a least costly way while maximizing the spread of the product. We generalize the Least Cost Influence Problem by moving away from the marketing setting and by treating the previous product as any piece of "information" that can spread over a social network by adoption. We show that this problem is polynomially solvable over tree networks under some conditions. We provide a Dynamic Programming algorithm to solve this problem and show that it can be interpreted as a greedy algorithm that gives incentives starting with the people that are least influenced by their neighbors, albeit the definition of susceptibility to influence from neighbors is updated throughout the algorithm. We introduce a two dimensional influence model and extend our modeling and solution methods for the product line design problem which involves designing multiple products within the same product line with the objective of appealing to the heterogeneous structure of the market. The first dimension of influence is the affection of individuals from using the same product, and the second dimension is the influence of using a similar product from the same product line which has a lower intensity of influence. We reexamine the Least Cost Influence Problem in the product line setting.Item ESSAYS IN (I) STRATEGIC ORDERING WITH ENDOGENOUS SEQUENCE OF EVENTS IN SUPPLY CHAIN (II) STRATEGIC MANAGEMENT OF NEW PRODUCT INNOVATION AND PROCESS IMPROVEMENT(2012) Kim, Yongjae; Xu, Yi; Goyal, Manu; Business and Management: Decision & Information Technologies; Digital Repository at the University of Maryland; University of Maryland (College Park, Md.)This dissertation discusses two research problems. First topic is strategic information management in supply chain, and second topic is analytical modeling approach in productivity dilemma. The first two chapters of dissertation discuss the impact of information asymmetry and competition on vertical contractual relationships, and risk neutral firms' strategic ordering decisions with minimal assumptions. Modern business environment caused by competition and information asymmetry plagues most firms across industries, often leading to suboptimal outcomes. Given the lead times in planning capacity, suppliers prefer earlier orders from their downstream partners (retailers). Much attention has been given in the literature to Advance Purchase Discount (APD), where the supplier lowers the wholesale price to entice the retailers to order early. In this dissertation, we suggest another avenue of early purchase model considering more realistic ways - competition between downstream retailers and information flows (from information acquisition to dissemination) in supply chain. We show that with one retailer having "better" market demand information on uncertain demand than the other, the supplier can induce earlier ordering from the better-informed retailer without any reduction in the wholesale price, or creating rationing risk. In addition, we investigate firm's information investment decisions corresponding to the timing of the orders. We extend the model with different information structures of firms such as imperfect and evolving information. In reality, firms can have more accurate market information near the selling season by acquiring it from more diverse resources. Consistent with practice, we explorer firm's equilibrium outcomes of endogenous sequencing game with this setting. The third chapter of dissertation is in the trade-off between production efficiency and new product innovation. A firm's ability to compete over time has been rooted not only in improved efficiency, but also in its ability to be simultaneously innovative (Abernathy (1978)). This trade-off between efficiency and innovation has long been discussed in the business context, but limited analytical research has been done using the `extreme value theory' (Dahan & Mendelson (2001)) to investigate this issue. Our model considers important exogenous innovation factors such as innovation characteristics (Benner & Tushman (2003)) and degree of competition, which has yielded the following theoretical results and practical implications. First, we highlight new product characteristics. If R&D projects are paradigm-shifting innovations, there is a stronger adverse effect between efficiency and innovation than incremental innovation. Second, competition results in underinvestment effort in innovation performance for the firms. For example, in the symmetric firms' competition, the optimal size of R&D projects decreased, as competition increases. On the other hand, firms are more likely to focus on process improvement activities.