Smart Cities Analytics - A Terrific Workshop In Canada

When the invitation came from Professor Joe Naoum-Sawaya of the Ivey Business School at Western University (formerly Western Ontario University) in London, Ontario, Canada, I was very intrigued. He and his colleague, Professor Bissan Ghaddar, were organizing a Workshop on Smart Cities Analytics, and might I be interested in speaking?

The invitation was quickly accepted and this past Thursday, after teaching my Transportation and Logistics class, I was off to Bradley Airport for my flights on Air Canada to Toronto and then to London (London, Ontario, that is)! The flights on the puddle jumpers were surprisingly very comfortable and I had a delightful conversation on the first leg with a mother, originally from Jamaica, who was traveling with her 7 month old daughter. She had been to visit her 90 year old grandmother in Connecticut and is still fostering children - she has fostered over 100. Hearing about such exceptional human beings is always a wonder of travel.

Having been to England in September for the OR60 conference and the Early Career Researcher Workshop at Lancaster to speak, I appreciated the big welcome sign at the London, Ontario airport (never to be confused with Heathrow but there is a Tim Horton's there). It was my first time to the Ivey School and London, Ontario.

The logistics of my travel were expertly organized with a pickup at the airport. The London Park Hotel, where the workshop guest speakers were accommodated, provided me with a suite which looked more like an apartment - I loved it! Given that I was in Canada, the next morning, I got to see many young hockey players at breakfast who were in town with their families for a tournament. Last Monday was Canadian Thanksgiving so many had a week holiday.

It was thrilling to see the guest speakers at the workshop and the participants. The Ivey School, the site of the workshop, is in a stunning building.

As you can see from the above workshop poster, the speakers traveled from France, Denmark, Ireland, and the US, with one local speaker, for the workshop, which clearly demonstrates the excitement surrounding the theme of the workshop. The full schedule with the talk titles and abstracts can be downloaded here. 

The format of the workshop was excellent, with 45 minute talks and time for discussion. Lunch was also provided as well as refreshments at breaks and registration was free, thanks to the sponsors. The audience consisted of faculty and students from the host university and neighboring universities, including the University of Waterloo (my host for my previous speaking engagement at a Canadian university). I admit, since I was born in Canada, I like to support my Operations Research and Management Science colleagues in Canada and it is a pleasure to do so.

The workshop began with a welcome and opening remarks by Professor Naoum-Sawaya and an Associate Dean at Ivey.

Thanks to Professor Joe Naoum-Sawaya for letting me be the first speaker. As promised to participants, I have posted my talk.


My talk was based on two earlier papers of mine: Design of Sustainable Supply Chains for Sustainable Cities, Anna Nagurney, Environment & Planning B 42(1): (2015) pp 40-57 and Supply Chain Network Sustainability Under Competition and Frequencies of Activities from Production to Distribution,  Anna Nagurney, Min Yu, and Jonas Floden, Computational Management Science 10(4): (2013) pp 397-422.

After the coffee break, it was time for Professor Ivana Ljubic to speak on Very Large Scale Covering Location Problems in the Design of Advanced Metering Infrastructure. Professor Ljubic is a Professor at ESSEC in France.

Her talk focused on smart metering and the Internet of Things (IoT) and the challenges posed by the limitations of current infrastructure. She described elegant models that she had constructed for related facility location problems to determine where to place bay stations for wireless communications to cover homes with the consideration of an investment budget or a percentage of demand coverage.  The exact algorithms that she presented, along with extensive computational results, on truly large-scale problems, were very elegant and impressive.

Professor Ljubic, who is very active on Twitter and is a jet-setter, and we enjoy communicating in this way, told me that she had met me at the Computational Management Science (CMS) conference in Vienna, Austria in 2010, so I promised her that I would try to retrieve some photos from that conference and I have posted them below - even with my former doctoral student, Tina Wakolbinger, who is now a Professor at the Vienna University of Economics and Business!

Professor Pierre Pinson of the Technical University of Denmark, who is French, presented a talk on Community-Based and Peer-to-Peer Electricity Markets, in which he shared with us that Copenhagen is planning on being carbon-neutral by 2050. He also told us that Denmark produces the cheapest electric power in Europe but, after taxes, it is the most expensive. He suggested that governments may need to rethink taxes in terms of social responsibility with taxes being a function of distance. He emphasized the purchasing of electricity locally and discussed consensus-based optimization with fascinating reciprocity constraints. He described how individuals have self-interest with interest to collaborate locally and how exchanges within a community do not have to be settled with monetary compensation. He also emphasized the construction of a social welfare function and the cost of a social construct with a community wanting to be as autonomous as possible. Professor Pinson further elaborated on networks of communities for urban design and mentioned blockchains and possible coordination mechanisms.He told us that "we need to change the game" and need new business models.

I thoroughly enjoyed his very thought-provoking presentation and told him that I will be reading his papers!

Then it was time for lunch and further stimulating conversations and discussions. Another special highlight for me was seeing Professor Hani S. Mahmassani, the Director of the Transportation Center at Northwestern University. Just to further emphasize how much I respect Professor Mahmassani, I even had a photo of him in my presentation that morning. Hani, if I may, is a true scholar and leader in transportation, one who not only does outstanding research but also parlays his work into practice with high impact. And, to further celebrate his accomplishments, in the introduction to his talk, Professor Naoum-Sawaya shared with us (I also heard this great news at lunch) that Professor Mahmassani has been appointed to the Advisory Board for Smart Cities for Monaco and also to the Advisory Board for the Panama Canal. So, huge congratulations to him!

Professor Mahmassani's talk was entitled: Predictive Analytics for Real-time Urban Mobility: Autonomous, Connected, Electric, Shared (ACES).

 Professor Mahmassani took us on a vivid journey of the state-of-the-art of his topic and described several key takeaways, overviewing connected vehicles (when and in what form and at what rate); major disruptive influences from technology to players; shared mobility fleets; why we still need predictive models even if we may be able to ultimately see the state of the transportation system at all times, and how transportation agencies must be willing to embrace change. He emphasized how autonomous, connected vehicle ideas have evolved from ITS with one of the goals being to eliminate or to reduce human errors. He spoke on connected systems that should be coordinated, with "cooperative driving," optimized flow and routing. He also brought up, which he recognized that I would very much appreciate - that freight services might be managed in a system-optimized manner, whereas travelers even in shared, connected vehicles, might be (should be) routed in a user-optimized way. Such discussions I have had with the students in the Transportation and Logistics class that I teach at the Isenberg School. He also brought out that intelligence (think of Google) will reside in vehicles but what about the infrastructure that will be needed to operationalize connected, autonomous vehicles? He mentioned a report put out by his center on Mobility 2050 - Emerging Futures, definitely word reading.

Given the fascinating talks, I hope that the organizers will be able to post them and, frankly, I asked when will the next such workshop be because of the stimulating important issues and discussions from multiple very creative perspectives!

Professor Mahmassani's talk was followed by a talk from another Northwestern University Professor, Professor Chaithanya Bandi of the Kellogg School. Concidentally, both are MIT PhD alums, but of different programs. Dr. Bandi changed the title and topic of his presentation  and his talk was on: Data Driven Analytics for Government, with a focus on Singapore! I have been invited to Singapore but have not been there (yet) although my husband has and he did bring me some marvelous souvenirs from there. We were presented with numerous fascinating facts about Singapore including that 80% of the population lives in public housing. The government shares "Moments of Life" in which its citizens are congratulated for various milestones. Humans are considered "sensors" with even government-aided dating taking place. Singapore is focused on "customizable communities" and Dr. Bandi shared with us the cost/taxes of vehicle ownership in Singapore. He then described some research that he has been involved in regarding hospital staffing and patient flows - data-rich but an uncertain environment. He also mentioned his work on LEGO Networks with Itai Guravich in which subsystems are first optimized and the system is then built up.

Then Professor Xianbin Wang of the Electrical and Computer Engineering at the host university discussed his research with collaborators in the presentation: Technical Challenges and Business Opportunities of Ubiquitously Connected Society. He asked the question - what are we trying to solve through IoT and by connecting everything? He also mentioned 5G and ICT infrastructure needs associated with it. Some of his concerns include interoperability issues associated with IoT and how to create internetwork collaboration. It was good to hear him mention the increasing overhead associated with cybersecurity and the proliferation of devices and impacts on communications. He is a proponent of "Software Defined Networking (SDN) Enabled Synergistic Resource Sharing".

The final presenter, and he deserves extra applause, was Professor Robert Shorten of University College Dublin, who spoke on: Distributed Ledger Technology, Cyber-Physical Systems, and Social Compliance. He, in his talk, showed us a collage of photos of activities in cities, including one with a homeless person rummaging through the trash and asked us what we had observed. He had posted this photo to demonstrate that we do not enforce social contracts and people may be putting rubbish in the incorrect bins and, hence, not recycling, as they should be. The homeless person was performing a useful task for society. Professor Shorten then described how blockchain has a lot of potential for the enforcement of social contracts and noted that distributed ledger systems (DLTs) have operational costs that are low and fast transaction times. he also spoke about competitive versus collaborative DLTs. He presented an elegant graph model of DAGs (directed acyclic graph) with no transaction fees. Underlying his work are ordinary differential equations for which he has also conducted stability analysis. It was great to see that in my talk I had described a Nash Equilibrium model for sustainable supply chains, and Professor Shorten also had Nash Equilibrium in one of his slides. He spoke about the use of tokens for "the cost of misbehaving" as when one would drive through a red light, for example, and the use of DLTs would be anonymous (an audience member brought up the use of fines). It was very interesting to listen to him speak on how to design controls so as to incentivize people to behave as in being socially compliant in traffic, given the risk of getting caught. He also brought up "string stability," as in what happens downstream in other junctions of the network, if someone drive through a red light.

Since my cellphone was dying I apologize for not taking a photo of Professor Shorten and, instead, I share several photos below of the group of speakers, the group of Twitter users, and the females on Twitter!

Thanks, again, to the organizers, the guest speakers, and the terrific audience, for a fabulous idea-generating workshop!

Terrific Energy, Cities, and Complex Systems Workshop in Magical Erice, Sicily

Last week I was in beautiful Erice, Sicily, where I had been once before, back in 2006, also for a workshop.

This time, I was an invited speaker at the Workshop on Energy, Cities, and Control of Complex Systems organized by Drs. Adilson Motter and Robert Schock.  Dr. Motter is a Professor at Northwestern University and Dr. Schock is a Senior Fellow on Global Security Research at Lawrence Livermore Lab in Berkeley.  Dr. Schock, this past week, received an honorary degree from his undergrad alma mater, Colorado College, so congratulations are in order! In the photo above I am standing with Dr. Schock who has a PhD from RPI.

The venue for the workshop was the Ettore Majorana Scientific Center, which was originally 4 monasteries with the bells pealing regularly to remind us of that point.

The workshop convened physicists, engineers, transportation researchers, network scientists, a computer scientist (from IBM), as well as energy researchers, an atmospheric scientist, a statistician, several policy makers (including one from Toronto, Canada), and an operations researcher and network economist (me).

This was a multidisciplinary workshop with talks ranging from those with not a single equation to those with many beautiful equations. Quite a few of the talks were on network themes, which I appreciated very much as well as the emphasis on nonlinear dynamics.

My presentation was on Sustainable Supply Chains for Sustainable Cities.

The workshop took place in a room with not great acoustics but with frescoes on the walls.

The meals were provided and the food was delicious - with fish caught that morning and with cannolis that we consumed and did not get heart attacks from. Perhaps it was all the oranges that we ate.

We were picked up at the Palermo airport and bussed through the beautiful hills of Sicily covered with poppies and other flowers to historic Erice.

Now I am back in Gothenburg, Sweden, where, interestingly, it is very warm, whereas it was quite cool in Sicily!

Mathematics of Planet Earth -- Special Issue of Computational Management Science

According to the website for Mathematics of Planet Earth MPE2013: More than a hundred scientific societies, universities, research institutes, and organizations all over the world have banded together to dedicate 2013 as a special year for the Mathematics of Planet Earth.

 The theme “Mathematics of Planet Earth” is interpreted as broadly as possible. In addition to climate change and sustainability, it includes geophysics, ecology and epidemiology, biodiversity, as well as the global organization of the planet by humans. The different topics have been classified into four themes.

The four themes of MPE2013:
* A PLANET TO DISCOVER: oceans; meteorology and climate; mantle processes, natural resources, solar systems
* A PLANET SUPPORTING LIFE: ecology, biodiversity, evolution
* A PLANET ORGANIZED BY HUMANS: political, economic, social and financial systems; organization of transport and communications networks; management of resources; energy
* A PLANET AT RISK: climate change, sustainable development, epidemics; invasive species, natural disasters.

I became aware of this great initiative last May when I spoke at the Computational Management Science conference in Montreal, Canada,  and heard from Professor Georges Zaccour that he, and Professor Michele Breton, were guest editing a special issue of the journal Computational Management Science on this theme.  Since last year I was on sabbatical and spending a lot of time at the School of Business, Economics and Law at the University of Gothenburg in Sweden, sustainability continues to be a major theme in my research. Plus, the emphasis on the environment in Gothenburg and in Sweden, overall, made for a perfect venue in which to work on a paper for this special issue. Our paper, Supply Chain Network Sustainability Under Competition and Frequencies of Activities from Production to Distribution, Anna Nagurney, Min Yu, and Jonas Floden, is now in press in this special issue  of Computational Management Science.

I was delighted to see the Preface to this special issue online on the journal website  The special issue, according to the Guest Editors Breton and Zaccour,  has 7 papers written by scholars having an extensive expertise in mathematical modeling and in environmental issues.The objective of this issue is to report on recent advances in modeling and in the development of computational methods for environmental issues such as global warming, pollution control, adaptation, sustainable exploitation of resources (forests, fisheries, etc(, sustainable supply chains, and more!

I expect that the hardcopy of the full issue will be produced soon since the contributions are online -- I am so looking forward to receiving my copy.

Congrats to the Guest Editors and thank you for your hard work which made this special volume possible! Also, thanks to the long-serving Editor of CMS, Professor Berc Rustem, for being a visionary.

The New York Times Energy for Tomorrow Conference

This week is Earth Week and tomorrow, in NYC, The New York Times is hosting the 2013 Energy for Tomorrow Conference with the theme Building Sustainable Cities. I am very much looking forward to taking part in this event and hearing experts on energy, sustainable buildings, urban food supply, technology, and transport and traffic speak and discuss how we, together, can achieve more livable cities in this century. 

I will be part of the discussion on Transport and Traffic moderated by The New York Times OpEd columnist, Joe Nocera. The other speakers in my session are:
 Walter Hook, president, Institute for Transportation and Development Policy,
 Peder Jensen, head of programme, governance and networks, European Environment Agency,
 Naveen Lamba, intelligent transportation lead, IBM, and
 Janette Sadik-Khan, NYC transportation commissioner.

I plan on discussing the (in)famous Braess paradox in which the addition of a new road may make all travelers/drivers in the network worse off in terms of an increase in travel time as well as the milk run freight paradox, where  increasing the load factor (as often used by policy-makers as a means of improving freight efficiency), under certain conditions,  can increase total costs and total emissions. The latter was discovered by Niklas Arvidsson, a doctoral student at the School of Business, Economics and Law, where I hold a Visiting Professorship (as part of my sabbatical this year from the Isenberg School of Management at UMass Amherst).

I  will also be highlighting the importance of supply chains and city logistics for sustainable cities. This is a topic that I am passionate about and my most recent accepted paper, "Design of Sustainable Supply Chains for Sustainable Cities,"  is in press in the journal, Environment & Planning B.

The full agenda of the energy conference can be viewed here.

Sustainable Cities Via Sustainable Supply Chains

Did you know that over one half of the world's population now resides in cities?

Which is your favorite city?

Might it be Boston?

or New York City?

perhaps Miami:

 

or Buenos Aires:

or Paris:

Stockholm:

Vienna:

or Shanghai?

I took all the above photos during speaking engagement trips over the past several years, except for the Shanghai one, which was taken by a former doctoral student of mine at the World Expo there.

When cities work well those who live in them can flourish in terms of mobility, health and welfare, accessibility, and innovation.


In the paper, "Design of Sustainable Supply Chains for Sustainable Cities," which is now accepted for publication in the journal, Environment & Planning B,  I emphasized  that cities, as dynamic complex networks, are the systems and the economic engines for commerce, research and development, education, healthcare, and even culture. They have evolved over space and time on built infrastructure from transportation networks to telecommunication and electric power networks.

At the same time, cities are the centers of resource usage from electricity and other forms of energy and fuel, to food, water, and a plethora of other products. Hence, they also are the repositories and generators of waste output and other environmental pollutants, such as carbon and other emissions, sewage, noise, etc. The term Sustainable Cities has come into increasing use in the past two decades, with a focus of making cities more livable, with an eye not only on the present generation but towards future ones, as well.

Our world is becoming a network of interconnected cities or a supernetwork of cities with  urbanization is one of the most pressing and complex challenges of the 21st century, with the citizenry characterized by a growing awareness of a threat to the sustainability of the earth’s natural environment, coupled with the increase in the number of people moving into and living in cities.

Cities are supplied by a complex array of supply chains servicing an immense spectrum of economic activities from food stores and restaurants, office supplies and high tech equipment, apparel, construction materials, as well as raw materials, to name just a few. The sustainability of supply chains is, hence, a precursor to the sustainability of our cities.

According to a Business for Social Responsibility (2009) paper, it is now widely acknowledged that making significant progress on mitigating the impact of climate change depends on reducing the negative environmental impacts of supply chains through their redesign and enhanced management (see also McKinsey Quarterly, 2008). Furthermore, as noted by Capgemini in its 2008 report: 2016: Future Supply Chain, “Preserving energy and raw materials and other resources like water will become a crucial aspect in future supply chains, as costs will likely remain volatile and supplies will continue to dwindle.”

These conditions may well create substantial pressure on current supply chain models.

In this paper, I constructed a new computable mathematical model,  that is network-based, for the design of sustainable supply chains with a focus on cities that captures the frequency of network link operations, which is especially relevant to cities due to frequent freight deliveries. An algorithm was then proposed, along with convergence results, and implemented for the computation of several numerical examples.

One of the goals in the paper was to demonstrate how, through the proper design (and operation) of these complex networks, waste can be reduced, along with the environmental impacts, while minimizing operational and frequency costs, and meeting demand.

For a presentation, with the same name, which also includes intellectual foundations inspired by Professor Martin Beckmann, the co-author of the classic book, Studies in the Economics of Transportation,  click here.

Urban Freight for Livable Cities -- Future Urban Transport

Gothenburg, Sweden -- to me -- is a very livable city and my experiences here as a Visiting Professor of Operations Management at the University of Gothenburg are very rewarding in all dimensions -- intellectually, socially, and even, if I may say, artistically, given the beauty of the environment, the parks, the elegance of the people here, the beauty of the architecture,  and the museums.

Today, the Future Urban Transport Symposium begins in Gothenburg, Sweden.

The theme this year is Urban Freight for Livable Cities and the program is fantastic  with a stunning brochure produced.

The sponsors of this workshop are Volvo, the city of Gothenburg, and VREF, marking a remarkable partnership.

Colleagues from academicians, researchers, as well as practitioners, and policy-makers, are convening from around the globe for this symposium.

It will be wonderful to listen to the presentations and to take part in the discussions.

It is an honor to also be a panelist at this symposium on a topic of great interest to many!

The most recent paper that I authored on this topic was  Design of Sustainable Supply Chains for Sustainable Cities.

Design of Sustainable Supply Chains for Sustainable Cities

As I wrote in my previous blogpost I am very much looking forward to being in Amsterdam next week to speak at and take part in the Complex-City Workshop.

The program is now available and support for this workshop is being provided by the Royal Netherlands Academy of Arts and Sciences (many thanks).

I will be speaking on a paper that I just completed, Design of Sustainable Supply Chains for Sustainable Cities.

I love cities and over the past few weeks have been to Boston, Paris, Miami, and New York City.

Cities, as dynamic complex networks, are the systems in which more people now live than don't and which represent the economic engines for commerce, research and development, education, health care, and even culture. They have evolved over space and time on built infrastructure from transportation networks to telecommunication and electric power networks.

At the same time, cities are the centers of resource usage from electricity and other forms of energy and fuel, to food, water, and a plethora of other products. Hence, they also are the repositories and generators of waste output and other environmental pollutants, such as carbon and other emissions, sewage, noise, etc.

The term Sustainable Cities has come into increasing use in the past two decades, with a focus of making cities more livable, with an eye not only on the present generation but towards future ones, as well. A recent World Bank report noted that the world is shrinking with cheaper air travel, large-scale commercial shipping, and expanding road networks. Today, only 10% of the globe's land area is considered to be remote, that is, more than 48 hours from a large city. Hence, our world is becoming a network of interconnected cities or a supernetwork of cities.

Urbanization is one of the most pressing and complex challenges of the 21st century, with the citizenry characterized by a growing awareness of a threat to the sustainability of the earth's natural environment, coupled with the increase in the number of people moving into and living in cities.


Supply chains consisting of suppliers, manufacturers, transportation service providers, storage facilities and distributors, as well as retailers, and consumers, serve as the backbones for the provision of goods as well as services on our modern global economy. Supply chains have revolutionized the way in which products are sourced, produced, distributed, and consumed around the globe. They may involve thousands of stakeholders from suppliers and manufacturers to hundreds of thousands of consumer demand points around the globe. Cities are supplied by a complex array of supply chains servicing an immense spectrum of economic activities from food stores and restaurants, office supplies and high tech equipment, apparel, construction materials, as well as raw materials, to name just a few. The sustainability of supply chains is, hence, a precursor to the sustainability of our cities.

According to a Business for Social Responsibility (2009) paper, it is now widely acknowledged that making significant progress on mitigating the impact of climate change depends on reducing the negative environmental impacts of supply chains through their redesign and enhanced management (see also McKinsey Quarterly (2008)).

Furthermore, as noted by Capgemini in its 2008 report: 2016: Future Supply Chain, Preserving energy and raw materials and other resources like water will become a crucial aspect in future supply chains, as costs will likely remain volatile and supplies will continue to dwindle. These conditions may well create substantial pressure on current supply chain models.

Although the importance of sustainable supply chains to the sustainability of cities is being increasingly recognized, in terms of not only the enhancement of business processes in terms of efficiency and cost reduction but also the reduction of negative environmental externalities as well as waste, there have been only limited modeling efforts that capture supply chains within a cities framework. Models of sustainable supply chains are important since they enable the evaluation (before expensive investments are actually made) as to alternative network designs, technologies, as well as sensitivities to cost and demand structures.

A feature of cities that we capture in the new sustainable supply chain network design model is the frequency of freight shipments, and other supply chain network activities, which tend to be higher in urban environments, due to the larger population density. Just think of all the stores and restaurants, to start, that need to be supplied with fresh products. By optimizing the frequencies, one may minimize not only the operational costs and replenishment costs but also the environmental damage (pollution, noise, wear and tear, etc.).

My paper, in pdf format, may be downloaded.

Designing Sustainable Blood Supply Chains

My doctoral student, Amir Masoumi, will be presenting our joint research on the design of sustainable blood supply chains at the upcoming INFORMS Annual Meeting in Charlotte, North Carolina. The presentation, which can be accessed here, is based on the paper of the same title, which is scheduled for publication, we recently heard, in early 2012, in the book, Sustainable Supply Chains: Models, Methods and Public Policy Implications, T. Boone, V. Jayaraman, and R. Ganeshan, Editors, Springer, London, England.

In addition, as I wrote in a recent blogpost, we will also be presenting our research on sustainable fashion supply chains at this conference.

Mary Leszczynsli of INFORMS has now posted the October Blog Challenge Results: O.R. and the Environment and the posts by bloggers in our community is not only informative but illuminating and entertaining, as well. You can access her summary and all the links here.

I contributed two posts to this challenge and wrote about meeting the Nobel laureate Dr. Elinor Ostrom (the only female to have been awarded the Nobel prize in Economic Sciences to-date) and on our research on sustainable supply chains. Enjoy the great writing of my fellow O.R. bloggers from Frommer to Marco-Serrano, McLay, Poppelaars, Serra, Smith, Subramanian, Trick, and Rubin! And let's not forget the Capgemini team!

The quality and sustainability of the environment affects us all.

Sustainable Fashion Supply Chains Using Game Theory

We have conducted a lot of research on sustainable supply chains with applications ranging from products in health care to electric power generation and distribution networks.

An industry, which just recently has started to receive attention because of its impact on the environment, is the fashion and apparel industry.

However, not much research has been conducted as to capturing the scope of the issues and the realities of this industry which includes different brands as well as competition, and even the speed of this industry, as in fast fashion.

A doctoral student of mine, Min Yu, has been working with me in this area for about two years now as part of our research on time-sensitive supply chains, in particular, and sustainability overall.

We will be presenting our latest study, "Sustainable Fashion Supply Chain Management Under Oligopolistic Competition and Brand Differentiation," at the INFORMS Annual Conference next week in Charlotte, North Carolina. This paper is in press in the International Journal of Production Economics, Special Issue on Green Manufacturing and Distribution in the Fashion and Apparel Industries.

In the paper, we developed a new model of oligopolistic competition for fashion supply chains in the case of differentiated products with the inclusion of environmental concerns. The model assumes that each fashion firm's product is distinct by brand and the firms compete until an equilibrium is achieved. Each fashion firm seeks to maximize its profits as well as to minimize its emissions throughout its supply chain with the latter criterion being weighted in an individual manner by each firm, since some firms may care more or less about their impact on the environment.

The competitive supply chain model is network-based and we use both game theory and variational inequality theory for the formulation of the governing Nash equilibrium as well as for the solution of the case study examples. The numerical examples illustrate both the generality of the modeling framework as well as how the model and computational scheme can be used in practice to explore the effects of changes in the demand functions; in the total cost and total emission functions, as well as in the weights.

Our full presentation can be downloaded, in pdf format here.

Sustainable Fashion Supply Chain Management Under Competition and Brand Differentiation

In an earlier blogpost, I wrote about our recent work in fashion supply chain management and in sustainable supply chain network design.

I am pleased to announce that one of my doctoral students, Min Yu, and I have completed a study of sustainable fashion supply chain management. In the study, which is documented in our research paper, we developed a modeling framework that captures competition in fashion supply chains in the case of differentiated products with the inclusion of environmental concerns. The model assumes that each fashion firm's product is distinct by brand.

Each fashion firm seeks to maximize its profits and to minimize the emissions that it generates throughout its supply chain as it engages in its activities of manufacturing, storage, and distribution, with a weight associated with the latter criterion. The model allows for alternative modes of transportation from manufacturing sites to distribution centers and from distribution centers to the demand markets, since different modes of transportation are known to emit different amounts of emissions.

The competitive supply chain network model advances the state-of-the-art of fashion supply chain modeling in several ways:

1. it captures competition through brand differentiation, which is an important feature of the fashion industry;

2. it allows for each firm to individually weight its concern for the environment in its decision-making, and

3. through a general network framework, alternatives such as multiple modes of transportation can be investigated.

In our paper, we also presented a case study, in which, through a series of numerical examples, we demonstrated the effects of changes on the demand price functions; the total cost and total emission functions, as well as the weights associated with the environmental criterion on the equilibrium product demands, the product prices, profits, and utilities. We noted that the environmental weights could also be interpreted as taxes and, thus, in exploring different values an authority such as the government could assess a priori the effects on the firms' emissions and profits.

The case study also demonstrated that consumers can have a major impact, through their environmental consciousness, on the level of profits of firms in their favoring of firms that adopt environmental pollution-abatement technologies for their supply chain activities.

Minimizing the Carbon Footprint Through the Design of Sustainable Supply Chains

It's official -- our paper, "Sustainable Supply Chain Network Design: A Multicriteria Perspective," has now been published in the International Journal of Sustainable Engineering. It appears in the September issue, volume 3 (2010), pp. 189-197 and can be accessed here.

The paper already has been receiving a lot of attention based on queries that I have gotten from publishers to expand the paper into a book.

With all the disasters in the world from floods to heat waves and fires, rigorous methodological tools that determine how to minimize the carbon footprint through sustainable supply chain network design can make a big difference in terms of emissions and costs.

Supply chains, as complex networks, consisting of manufacturing plants, different modes of transportation and distribution, as well as possible storage technologies, can span the globe and, hence, identifying the optimal design of such networks in terms of both costs and emissions, notably, in terms of the carbon generated, can impact not only a firm's profits but also its reputation through an enhanced environmental reputation.

We are delighted that our research and paper can contribute in this direction.

Three Women Write a Book on Environmental Networks -- Was it Too Early?

In 1999, two of my former doctoral students, Kanwalroop "Kathy" Dhanda and Padma Ramanujam, both of whom were from India, and I had our book, "Environmental Networks: A Framework for Economic Decision-Making and Policy Analysis," published by Edward Elgar Publishing in the series: New Horizons in Environmental Economics.

The book was based on years of our research and publications that we had authored and co-authored that had appeared in such top journals as: Operations Research, Transportation Science, Networks, the Journal of Regional Science, and Energy Economics, among others.

I always wondered, how many books, even of a nontechnical nature, have been published with three (or more) females as co-authors?

Now, with parts of the world reporting record-breaking summer heat and Congress mired in inertia regarding the passage of a major climate bill, as David Leonhardt writes in The New York Times, I thought it important to bring this book to the renewed attention of policy makers.

The book describes rigorous tools for the determination of pollution permits and taxes, and associated environmental emissions, from both stationary sources, such as firms, as well as from moving sources of pollution, such as vehicles. Padma's doctoral dissertation was on the latter topic and it was awarded the 1999 Transportation Science Section of INFORMS dissertation prize.

The Harvard economist, Richard Stavins, whose work we cited in our book, told Leonhardt recently that he would actually prefer a bill that cut emissions less in the short term but created a template for much bigger cuts in the future. Success, to me, would be the beginning of political acceptance of carbon pricing, he said.

Leonhardt believes that: A utility-only cap, even a flawed one, really would represent a whole different kind of progress than a souped-up version of fuel economy rules. A cap — any decent cap — remains the best benchmark of success.

Interestingly, the doctoral dissertation of my most recent PhD student to graduate, Dr. Trisha Woolley, entitled: "Sustainable Supply Chains: Multicriteria Decision-Making and Policy Analysis for the Environment," focuses on the electric power industry and utilities and considers both carbon taxes (either centralized or decentralized) as well as pollution permits.

In the next few weeks, before the Senate breaks for its August recess, or in September, before the midterm election campaign takes over, major issues regarding the climate bill will be decided, we expect and hope.

Rachel Carson with her book, "A Silent Spring," changed the world.

It is time for another book to do the same and break the legislators out of their inertia.

And yes, women do write "Big Ideas" books, something that Germaine Greer has even been emphasizing although, ironically, some of these books may be rather mathematical and scientific!

BP Oil Rig Environmental and Economic Disaster and Supply Chain Design

I returned recently from speaking at a workshop in Honolulu, Hawaii, where I heard from many locals of their outright physical pain and disgust at the growing oil spill from the Deepwater Horizon rig blowout in the Gulf of Mexico. I have refrained from writing about this disaster, with the explosion dating to April 20, 2010, until now, since, as many, I was hoping that, perhaps, the "top kill" approach might work to block the massive flow of oil spilling from this deepwater rig. It has not worked, which is another very serious setback.

Elisabeth Rosenthal writes in The New York Times, that already half a decade ago, David Eyton, who was then BP's Vice President for deepwater development in the Gulf, noted that: IF we’ve learned anything so far about the deepwater Gulf of Mexico, it is that it contains surprises. And that means an operator needs depth — depth in terms of resources and expertise — to create the capability to respond to the unexpected.

As a professor at the Isenberg School of Management, who is in the Department of Finance and Operations Management, it is clear to me that there was insufficient risk assessment conducted prior to this drilling endeavor. The potential benefits (think profits) were weighted more highly than any potential costs, including risks; not to even mention the potential adverse environmental impacts.

Companies must recognize the importance of corporate social responsibility and the negative externalities of their actions on citizens, on nature and the environment, and on a sustainable way of life. Ways of life of those who have labored hard and long, including the fishermen, in areas so adversely affected are being transformed for the foreseeable future. The anger and frustration are felt by us all.

The design of our supply chain networks so that environmental and risk issues are explicitly incorporated is essential. We, as faculty and students in business schools, need to collaborate across boundaries (disciplinary and professional ones) to provide tools that can assess the potential impacts of corporate actions.

In a week, the ALIO-INFORMS conference begins in Buenos Aires, Argentina. One of the talks that I will be presenting there is entitled: "Sustainable Supply Chain Network Design: A Multicriteria Perspective." The presentation has now been posted and is available for download (in pdf format).

This talk is based on the paper, with the same title, which is now in press in the journal, The International Journal of Sustainable Engineering. The paper captures, in a quantifiable way, multicriteria decision-making in supply chain design, which includes, for example, environmental impacts associated with different technologies.

As for other ways, in addition to solid research, that business school students and faculty can help with regards to this environmental and economic disaster, although we may be physically thousands of miles away, read this blog post.

It is clear that worse-case analysis was not addressed in the planning and construction of this deepwater oil rig in the Gulf of Mexico.

Sustainable Supply Chain Networks and Design

The New York Times should be commended for publishing not one but two articles on sustainable supply chains and transportation in the same issue! Yesterday, in its Business Day section, The Times had an article, Clearing the Air at American Ports, written by Steven Greenhouse (appropriate name for this topic) and Wal-Mart Plans to Make its Supply Chain Greener by Stephanie Rosenbloom.

The former article discusses how the ports of LA and Long Beach are the single largest contributors to air pollution in the Los Angeles area, due to diesel pollution, and how a unique partnership, a labor-green alliance, is looking to prevent old trucks, which generate greater levels of emissions, from hauling cargo from the ports. The burden of replacing the older trucks with new trucks, which emit fewer emissions, is to be placed on the trucking companies, rather than on the individual truckers, many of whom, because of the large costs, are just barely eking out a living.

The article on Wal-Mart, in turn, emphasizes how Wal-Mart is working with suppliers to reduce greenhouse gas emissions in its supply chain to a tune of 20 million metric tons by 2015 (which would be equivalent to removing more than 3.8 million cars from roads for one year)! Suppliers are to examine the complete carbon lifecycle of their product -- from the manufacturing and use of raw materials through the recycling stage. Given Wal-Mart's clout and heft, as well as its growing emphasis on sustainability, such initiatives are proactive and timely (and also help to reduce energy costs).

We have been conducting research on sustainable supply chains and transportation for many years and have published articles (and even books) on such topics.

In 2007, I wrote the article, "Sustainable Supply Chain and Transportation Networks," with Dr. Zugang "Leo" Liu and Dr. Trisha Woolley, two of my former doctoral students, who are now, respectively, professors at Pennsylvania State University at Hazelton, and at Texas Wesleyan University in Fort Worth. This article, which appeared in the inaugural issue of the journal, International Journal of Sustainable Transportation, is available for downloading for free from the journal's website.

Our article demonstrates how competition among decision-makers in supply chains, who are multicriteria decision-makers, and interested in reducing emissions, can be combined with collaboration across successive tiers of the supply chain. Hence, this framework allows for the determination of the ultimate supply chain network design for sustainability in the case of alliances and partnerships, as we have been reading more and more about in the press.

This article of ours is one in a series on sustainability, supply chain networks and transportation, which can be accessed on the Virtual Center for Supernetworks (please use Internet Explorer or update your Mozilla browser for downloading of pdf files from this site).

Research4life Initiative, International Transactions in Operational Research, and 15th PhD student to be defending

Today I received an email message from Dr. Celso Carneiro Ribeiro of Brazil, who is the Editor of the journal, International Transactions in Operational Research (ITOR), that this journal will be added to the list of journals included in the Research4Life Initiative, which provides low-cost access for developing nations to journal content. Wiley-Blackwell, the publisher of ITOR (and our Fragile Networks book, as well), is committed to the Research4Life initiative. In particular, Wiley-Blackwell is a member of the International Association of Scientific, Technical and Medical Publishers and ITOR, with its overarching theme of Operations Research, is applicable to all three areas covered by the initiative, that is, health, agriculture, and the environment. I urge you to read up on the Research4Life initiative and note that the testimonials are very touching. Research4Life is a partnership seeking to help out in achieving the United Nation's Millennium Development goals.

I am very honored to be a member of the Editorial Board of ITOR and the paper, co-authored with Trisha Woolley and Patrick Qiang, entitled, "Multiproduct Supply Chain Horizontal Network Integration: Models, Theory, and Computational Results," has now been published online by this journal. Coincidently, Patrick Qiang was my 14th PhD student to complete his dissertation (in May 2009) and Trisha Woolley will be defending her doctoral dissertation, entitled, Sustainable Supply Chains: Multicriteria Decision-Making and Policy Analysis for the Environment, next month. She will be my 15th PhD student, quite the milestone! Trisha Woolley begins next week her tenure-track Assistant Professorship at Texas Wesleyan University in its School of Management.

It is terrific to have students who are carrying out research on sustainable supply chains and policy interventions ranging from carbon taxes to tradable pollution permit systems (also known as cap and trade systems). Some of our recent research publications and studies can be found on the Virtual Center for Supernetworks website.

My former doctoral students who have conducted research on transportation, supply chains, and environmental concerns have now assumed positions in such universities as the University of Sydney in Australia, York University in Canada, the University of Connecticut, DePaul University in Chicago, and two different Penn State campuses. One of my former doctoral students, Dr. Padma Ramanujam, whose dissertation received the Transportation Science dissertation prize, is with SAS in North Carolina. Needless to say, I am so very proud of all those students, whose doctoral dissertations I have had the privilege to chair!