Mar/Apr 2010

FEATURED ARTICLES

Revenue Management in the Era of Social Networking

These words could serve as a cautionary note to any managers who ignore the importance of analytics in their industry. They are attributed to Donald Burr, the entrepreneur who helped found People Express Airlines in 1981 and, over the next four years, led it through exceptional growth to revenues nearing $1 billion — reportedly the fastest growth of a U.S. company in history to that time [Cross, 1997]. The company worked with a lean workforce and minimal overhead while providing “no-frills” service. This allowed it to offer airfares significantly lower than those of any major competitor. By 1985, People Express was the fifth largest U.S. passenger carrier and was directly challenging major U.S. airlines in many of their key markets.
- Yuri Levin
- Jeff McGill
Seven Suggestions for Successful Solution Startups

Throughout our careers, we have found ourselves working from certain principles that have served us well. We share these managerial guidelines to provide the systems analyst with an appropriate and hopefully helpful grounding. We concentrate on the start of a project for we have found that making a good start goes a long way toward having a successful finish. The principles are presented here in outline form so the analyst can consider them point-by-point and refer to them easily as the need arises.
- Jerry Banks
- Ken Musselman
On The Road To Connectivity

In the two years since our last survey of vehicle routing software, the world has suffered a financial collapse unlike any since the 1920s. Sinking home values, overseas wars, terrorism, threats of global warming and turmoil in health care have capped a decade that many would prefer to forget. As we look forward, the global financial disaster has taught us one thing: simply moving money from account to account does not produce prosperity. Instead, our well-being depends on building economic activities that deliver goods and services to real people, when and where they need them.
- Janice Partyka
- Randolph W. Hall
Analytics at UPS

Founded in 1907 as a messenger company in Seattle, Wash., United Parcel Service (UPS) has grown into a $51.5 billion corporation by clearly focusing on the goal of enabling commerce around the globe. Today, UPS is a global company with one of the most recognized and admired brands in the world. UPS has become the world’s largest package delivery company and a leading global provider of specialized transportation and logistics services. Every day, UPS manages the flow of goods, funds and information in more than 200 countries and territories worldwide.
- Jeff Winters
- Doug Mohr
Practice Preview: World-class Analytics Conference

Where do world-class organizations go to showcase the strategic use of operations research and analytics? For the past 10 years, the venue of choice has been the INFORMS (Institute for Operations Research and the Management Sciences) conference on O.R. practice, “Applying Science to the Art of Business.” This year’s conference, scheduled for April 18-20 at the new Hilton Bonnet Creek Resort in Orlando, Fla., will once again demonstrate the competitive advantage of analytics.
- Teresa Cryan

DIGITAL EDITION

DEPARTMENTS

Inside Story

Mothers of Invention

Peter Horner

If necessity is the mother of invention, then deregulation is the father, and revenue management is the couple’s golden child, at least as far as the airline industry is concerned.

Executive Edge

Seeing the Future in Value Chain Management

Kevin Harrington

Managing a global value chain for a $40 billion company is a complex challenge. Thankfully we have 9,000 colleagues to help us in our Customer Value Chain Management organization at Cisco. My role is to lead a global business operations team responsible for, among other things, strategy and planning, supply chain capability creation, ERP evolution and business intelligence across an end-to-end spectrum of disciplines that we call the customer value chain. The value chain, as we define it, goes beyond traditional supply chain management and covers everything from new product introduction and demand management through order management, sourcing, manufacturing, quality management, logistics, recycling and re-use.

Profit Center

Crawl, Walk or Run

Andrew Boyd

A common question when starting down the path of analytics is whether to start big, small or somewhere in between. Like so many things in life, there’s no one simple answer. There are, however, some useful guidelines.

Viewpoint

The Perils of Equating Bankers to Bees

Pablo Triana

One of the most influential mathematical finance models ever is the so-called Gaussian Copula model. Now consigned to the dustbin of failed experiments, the Gaussian Copula enjoyed untold stardom in the early years of this century, becoming central in the valuation and rating of the convoluted mortgage-related assets that unleashed the credit crisis.

Newsmakers

Disaster Relief, Biodefense Policy, Management Ideas

Analytics in Action

Schneider National Runs With Analytics

With approximately 15,000 drivers and independent contractors, Green Bay,Wis.-based Schneider National is one of the largest truckload carriers in North America. The company’s operations include about 14,000 tractors and 40,000 trailers, and Schneider’s driver associates collectively cover more than five million loaded miles per day.

Last Word

A Hiring Incident in the Desert

Gene Woolsey

Some years ago there was a nameless National Laboratory somewhere in this great land of ours. The laboratory’s main reason for existence was to improve the design of various kinds of thermonuclear devices, build them and store them. But like all government laboratories, its reason for existence slid glacially and asymptotically toward “pure” research. The way to get promoted or raised was to publish more papers in the “respectable” journals in the field. The most far-out department was the mathematics group. In theory their job was to provide whatever applied mathematics and optimization that any other part of the plant might need. The truth, however, was that its members happily had been doing, were doing and proposed to continue to do, “pure” research in whatever area of pure mathematics ran their motor.