Decision Science Digest: April 26, 2022

BALTIMORE, MD, April 26, 2022 – 

EDITOR’S NOTE: Decision Science Digest is a periodic communique highlighting recent peer-reviewed research published by INFORMS, the largest association for the decision and data sciences, across its 17 journals. This issue highlights four press releases based on the findings of new peer-reviewed articles.

• Retail is Not Dead! The Impact of Store Proximity on Sales (INFORMS journal Management Science)
• New Research Overcomes Cost Barriers for Newborn Disease Screening While Increasing Efficiency and Testing Accuracy (INFORMS journal Management Science)
• New Model Predicts Purchase to Delivery Time to Increase Customer Satisfaction, Improve Online Sales (INFORMS journal Manufacturing & Service Operations Management)
• New Research Finds Stable Scheduling Increases Employee Productivity and Business Revenue (INFORMS journal Management Science)

New Research Finds Retail Store Proximity Impacts Sales, Increases Value of Brick-and-Mortar Businesses

Retail is not dead! New research in the INFORMS journal Management Science finds that store proximity increases brand consideration across channels and increases the attractiveness of purchasing in-store. The results found in the paper, “Demand Expansion and Cannibalization Effects from Retail Store Entry: A Structural Analysis of Multi-channel Demand,” provide evidence of a promotional effect of retail: retail presence raises brand consideration, which leads to increased purchase frequency, but there is no evidence that reduced transportation costs are transferred to spending budgets. The work also finds that retail expansion can potentially hurt the business by limiting its ability to price discriminate across channels, because reducing transportation costs weakens the store’s ability to enforce channel-based segmentation schemes. That said, the benefits from the increase in brand consideration due to closer store proximity outweighs this effect. Link to full article.

More Efficient and Accurate Newborn Testing That Also Overcomes Cost Barriers

Newborn screening (NBS) is a state-level initiative that detects life-threatening genetic disorders in babies that can be treated early and dramatically improve health outcomes. Most states use a multi-test screening process that includes a genetic test (DNA). However, due to cost concerns, DNA is used only on a small subset of newborns. To overcome the cost barriers of expanded genetic testing, researchers explore multipaneled pooled DNA testing. New research in the INFORMS journal Management Science finds multipaneled and pooling aspects of genetic testing work synergistically and can substantially improve both the efficiency and accuracy of current practices. In the paper, “Novel Pooling Strategies for Genetic Testing, with Application to Newborn Screening,” researchers looked at cystic fibrosis NBS data from New York. Link to full article.

New Model Estimates Product Delivery Time More Accurately, Improving Online Sales by 6% 

Providing fast and reliable delivery services is key to running a successful online retail business. To achieve a better delivery time guarantee policy, new research in the INFORMS journal Manufacturing & Service Operations Management looks at how to estimate and promise delivery time for new customer orders in real time. The researchers designed a model that can achieve this and improve sales volume by more than 6%. The study, “Real-Time Delivery Time Forecasting and Promising in Online Retailing: When Will Your Package Arrive,” finds consumers weigh the value of the product against the delivery service quality before making purchase decisions. Therefore, logistics performance is a critical success factor for e-commerce. Link to full article.

Happier Employees Leads to Happier Owners: How Stable Scheduling Increases Employee Productivity and Overall Store Revenue

There are more than 16 million workers in the retail sector. Their work schedules have become erratic as employers try to match schedules with fluctuating customer traffic in stores. New research in the INFORMS journal Management Science shows that providing stable work schedules leads to higher profitability because employees become more productive. Researchers find that stable schedules lead to a 5% increase in productivity. The study, “Doing Well By Doing Good: Improving Store Performance with Responsible Scheduling Practices at the Gap, Inc.,” looked at 28 Gap stores in San Francisco and Chicago. Several states and cities are passing laws aimed at improving scheduling fairness. Prior research shows businesses are concerned that improving scheduling fairness might lead to profit erosion. On the contrary, this research finds that improving schedules can lead to higher profitability. Link to full article.

About INFORMS 

INFORMS advances and promotes the science and technology of decision-making to save lives, save money and solve problems. As the largest association for the decision and data sciences, INFORMS members support organizations and governments at all levels as they work to transform data into information, and information into insights that lead to more efficient, effective, equitable and impactful results. INFORMS’ 10,000+ members are comprised of a diverse and robust international community of practitioners, researchers, educators and students from a variety of fields.

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Contact:

Ashley Smith

443-757-3578

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