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Servicization is an emerging business paradigm that entails selling services along with physical goods. Money is paid for the utility value derived from using the product. To ensure the product runs well, the servicizing manufacturer bears the cost for operating it. We establish a Stackelberg game to investigate the interaction between a manufacturer and an operator using the product provided by the manufacturer. As a servicizing firm, the manufacturer is more likely to be capital-constrained. When the manufacturer has to raise funds for the production, it has two channels: external financing, which means raising funds from a bank, and internal financing, which means raising funds from the operator. Both the manufacturer and the operator may act as the leader under external financing, while under internal financing, the operator always moves first. We find that under external financing, moving first is not always beneficial. Also, high operating efficiency benefits both chain members when the manufacturer is the leader, but both are hurt when the operator leads. We find that it can be optimal to provide a subsidy not only when the operating efficiency is low but also when it is very high. Furthermore, when the per-unit price is high, the manufacturer should accept a high interest rate to facilitate earning more profit.
Zhong-Zhong Jiang; Guangqi Feng; Zelong Yi. How should a capital-constrained servicizing manufacturer search for financing? The impact of supply chain leadership. Transportation Research Part E: Logistics and Transportation Review 2020, 145, 102162 .
AMA StyleZhong-Zhong Jiang, Guangqi Feng, Zelong Yi. How should a capital-constrained servicizing manufacturer search for financing? The impact of supply chain leadership. Transportation Research Part E: Logistics and Transportation Review. 2020; 145 ():102162.
Chicago/Turabian StyleZhong-Zhong Jiang; Guangqi Feng; Zelong Yi. 2020. "How should a capital-constrained servicizing manufacturer search for financing? The impact of supply chain leadership." Transportation Research Part E: Logistics and Transportation Review 145, no. : 102162.
Problem definition: This paper investigates how counterfeits influence a global supply chain and how the supply chain should effectively take anticounterfeit actions. Academic/practical relevance: The impacts of counterfeiting have been increasingly profound on global supply chains. It is critical to understand how counterfeiting impacts supply chains when supply chain members act in their own interests, and how supply chains can effectively combat counterfeiting when all the members can contribute to it. This is the first paper that offers insights into these important questions. In particular, we examine who among the supply chain members is in the best position to perform counteracting activities, how these members can cooperate in anticounterfeiting, and what economic implications the anticounterfeit actions have to the supply chain, individual firms, consumer surplus, and social welfare. Methodology: We consider a supply chain consisting of a manufacturer and a retailer, and analyze a game-theoretical framework to derive the equilibrium. Results: The manufacturer prefers to induce the retailer to combat counterfeits rather than to combat itself. Contrary to conventional wisdom, counterfeits can increase the supply chain’s profit even in the absence of network externality effects. The crux is that the manufacturer lowers wholesale price to incentivize the retailer’s counteraction and, consequently, the threat of counterfeits can mitigate double marginalization and benefit the supply chain. Managerial implications: Our results demonstrate that a sustainability risk can trigger collaborative endeavors of supply chain members and thus be advantageous to the supply chain. The findings also underscore the important role that retailers should play in anticounterfeiting. Particularly, it can be in the supply chain’s interest that the manufacturer does not execute the counteraction, either jointly with the retailer or by itself.
Zelong Yi; Man Yu; Ki Ling Cheung. Impacts of Counterfeiting on a Global Supply Chain. Manufacturing & Service Operations Management 2020, 1 .
AMA StyleZelong Yi, Man Yu, Ki Ling Cheung. Impacts of Counterfeiting on a Global Supply Chain. Manufacturing & Service Operations Management. 2020; ():1.
Chicago/Turabian StyleZelong Yi; Man Yu; Ki Ling Cheung. 2020. "Impacts of Counterfeiting on a Global Supply Chain." Manufacturing & Service Operations Management , no. : 1.
Information asymmetry is particularly common in the supply chain framework. As we know, the downstream retailer usually knows more about the market demand information than the upstream manufacturer because of her proximity to consumers. This paper considers a supply chain that a manufacturer sells products to consumers via a retailer in a local market. Besides, the manufacturer has an option to establish a direct online channel in the overseas market, in which the retailer can sell products as a gray marketer to earn an extra profit. Both markets’ demand information is transparent to the retailer but asymmetric to the manufacturer. There are two side an opposite effects of information sharing on the retailer. The positive effect is that when she withholds demand information she can possess an information advantage. However, the negative effect is that when the retailer shares her private demand information, especially when the manufacturer enters the overseas market, the retailer’s profit may be negatively affected because of the competition. Therefore, whether the retailer has motivation to share her private demand information with the manufacturer is an intriguing yet unanswered question. We first characterize the tradeoff in three supply chain structures, Local Market, Dual Market and Gray Market. Then, we obtain the equilibrium results of each case and find that a co-opetition strategy may arise because of competition when considering gray market and dual-channel. Finally, we uncover the underlying reasons and develop valuable insights.
Zhong-Zhong Jiang; Jinlong Zhao; Zelong Yi; Yaping Zhao. Inducing information transparency: The roles of gray market and dual-channel. Annals of Operations Research 2020, 1 -30.
AMA StyleZhong-Zhong Jiang, Jinlong Zhao, Zelong Yi, Yaping Zhao. Inducing information transparency: The roles of gray market and dual-channel. Annals of Operations Research. 2020; ():1-30.
Chicago/Turabian StyleZhong-Zhong Jiang; Jinlong Zhao; Zelong Yi; Yaping Zhao. 2020. "Inducing information transparency: The roles of gray market and dual-channel." Annals of Operations Research , no. : 1-30.
Many software developers provide end-users with feature-limited free trials to facilitate the distribution of their commercial products. Some international developers also authorize local agents to resell software products to consumers. In this paper, we explore a software developer’s optimal trial strategy in the presence of an agent. Due to the involvement of the agent, the double marginalization effect may result in a higher price and a lower demand for the commercial software. We find that, if the network effect is strong enough, the developer will release a trial version and attract trial users to secure greater positive externality, which is consistent with the case without an agent involved. However, if the network effect is weak, the developer may still release a trial version to the public, which sharply contrasts the case without an agent involved. A trial is offered in a bid to countervail the negative double marginalization effect. We also extend this work by endogenizing the trial-version quality, and examining the differentiation induced by trial offer decisions made by different firms in the supply chain. Furthermore, we investigate the effects induced by consumers’ differentiated costs of using the free trial and commercial versions.
Zelong Yi; Fan Li; Lijun Ma. The impact of distribution channels on trial-version provision with a positive network effect. Omega 2019, 85, 115 -133.
AMA StyleZelong Yi, Fan Li, Lijun Ma. The impact of distribution channels on trial-version provision with a positive network effect. Omega. 2019; 85 ():115-133.
Chicago/Turabian StyleZelong Yi; Fan Li; Lijun Ma. 2019. "The impact of distribution channels on trial-version provision with a positive network effect." Omega 85, no. : 115-133.
Identifying influential spreaders in complex networks is crucial for containing virus spread, accelerating information diffusion, and promoting new products. In this paper, inspired by the effect of leaders on social ties, we propose the most influential neighbors’ k-shell index that is the weighted sum of the products between k-core values of itself and the node with the maximum k-shell values. We apply the classical Susceptible-Infected-Recovered (SIR) model to verify the performance of our method. The experimental results on both real and artificial networks show that the proposed method can quantify the node influence more accurately than degree centrality, betweenness centrality, closeness centrality, and k-shell decomposition method.
Zelong Yi; Xiaokun Wu; Fan Li. Ranking Spreaders in Complex Networks Based on the Most Influential Neighbors. Discrete Dynamics in Nature and Society 2018, 2018, 1 -6.
AMA StyleZelong Yi, Xiaokun Wu, Fan Li. Ranking Spreaders in Complex Networks Based on the Most Influential Neighbors. Discrete Dynamics in Nature and Society. 2018; 2018 ():1-6.
Chicago/Turabian StyleZelong Yi; Xiaokun Wu; Fan Li. 2018. "Ranking Spreaders in Complex Networks Based on the Most Influential Neighbors." Discrete Dynamics in Nature and Society 2018, no. : 1-6.
With the rising popularity of consumer reviews, the design of the review system becomes increasingly crucial for e-commerce platforms and online retailers in their business decision-makings. Though the relationship between consumer reviews and sales has been extensively studied, only few studies have been conducted on the effects of different review designs. In this paper, we collect detailed review data from Meituan.com, a popular Chinese shopping website, to examine the effects of numerical presentation of consumer reviews (detailed to one decimal place) and graphical presentation of consumer reviews (in half-stars) on sales. By using a regression discontinuity design, we find that while consumer review scores may affect sales positively, the star presentation can create negative, rather than positive, jumps at cutoffs. Consumers restrict their attention to a star category; therefore, the “best” sellers in a lower star category are better off than the “worst” sellers in a higher star category. The incentive for review manipulation is strongly reduced, which in the long run will create trust and confidence for the review system as well as the sellers. For those sellers that are just below the cutoffs, simply crossing over the cutoffs would not lead to higher sales. Instead, they will have to substantially improve their service quality to attract consumers.
Wenche Wang; Fan Li; Zelong Yi. Scores vs. stars: A regression discontinuity study of online consumer reviews. Information & Management 2018, 56, 418 -428.
AMA StyleWenche Wang, Fan Li, Zelong Yi. Scores vs. stars: A regression discontinuity study of online consumer reviews. Information & Management. 2018; 56 (3):418-428.
Chicago/Turabian StyleWenche Wang; Fan Li; Zelong Yi. 2018. "Scores vs. stars: A regression discontinuity study of online consumer reviews." Information & Management 56, no. 3: 418-428.
An affordable and reliable supply of electricity service is essential to encourage sustainable social development in developing countries. Colombia uses cross-subsidies to prompt electricity usage for poor households. This raises the issue of whether charging lower prices to poor households, while boosting their consumption, induces utilities to lower the quality of service received by them. This paper uses unique databases and examines how underfunded cross-subsidies affect perceived electricity service quality across consumer groups. Results indicate that when facing financial deficits, utilities provide lower perceived service quality to subsidized consumers than to residents paying surcharges. The difference in perceived quality across consumer groups is reduced by an increase in the amount of (external) government transfers. To prompt electricity consumption by the poor, the Colombian government should fund subsidies, strengthen quality regulation, and increase the transparency and reliability of government transfers.
Fan Li; Wenche Wang; Zelong Yi. Cross-Subsidies and Government Transfers: Impacts on Electricity Service Quality in Colombia. Sustainability 2018, 10, 1599 .
AMA StyleFan Li, Wenche Wang, Zelong Yi. Cross-Subsidies and Government Transfers: Impacts on Electricity Service Quality in Colombia. Sustainability. 2018; 10 (5):1599.
Chicago/Turabian StyleFan Li; Wenche Wang; Zelong Yi. 2018. "Cross-Subsidies and Government Transfers: Impacts on Electricity Service Quality in Colombia." Sustainability 10, no. 5: 1599.
Software reliability growth models (SRGMs) based on a nonhomogeneous Poisson process (NHPP) are widely used to describe the stochastic failure behavior and assess the reliability of software systems. For these models, the testing-effort effect and the fault interdependency play significant roles. Considering a power-law function of testing effort and the interdependency of multigeneration faults, we propose a modified SRGM to reconsider the reliability of open source software (OSS) systems and then to validate the model’s performance using several real-world data. Our empirical experiments show that the model well fits the failure data and presents a high-level prediction capability. We also formally examine the optimal policy of software release, considering both the testing cost and the reliability requirement. By conducting sensitivity analysis, we find that if the testing-effort effect or the fault interdependency was ignored, the best time to release software would be seriously delayed and more resources would be misplaced in testing the software.
Fan Li; Ze-Long Yi. A New Software Reliability Growth Model: Multigeneration Faults and a Power-Law Testing-Effort Function. Mathematical Problems in Engineering 2016, 2016, 1 -13.
AMA StyleFan Li, Ze-Long Yi. A New Software Reliability Growth Model: Multigeneration Faults and a Power-Law Testing-Effort Function. Mathematical Problems in Engineering. 2016; 2016 ():1-13.
Chicago/Turabian StyleFan Li; Ze-Long Yi. 2016. "A New Software Reliability Growth Model: Multigeneration Faults and a Power-Law Testing-Effort Function." Mathematical Problems in Engineering 2016, no. : 1-13.