Focusing or Balancing? The Resource Allocation Problem for Demand Forecasting and Performance Measurement

Operations Research Letters, 40(1) 61-68, 2012

16 Pages Posted: 17 Aug 2013 Last revised: 15 Feb 2017

See all articles by Ling-Chieh Kung

Ling-Chieh Kung

National Taiwan University - Department of Information Management

Ying-Ju Chen

Hong Kong University of Science & Technology (HKUST) - Department of Information Systems, Business Statistics and Operations Management; Hong Kong University of Science & Technology (HKUST) - Dept. of Industrial Engineering and Decision Analytics

Abstract

We consider a retailer investing in two monitoring functions for unobservable demand and salesperson’s effort. We show that improving effort monitoring is more effective. Moreover, demand monitoring may be less preferable when it becomes relatively cheaper and balancing these two may be worse when they become more complementary.

Keywords: information asymmetry, demand forecasting, performance measurement, resource allocation

Suggested Citation

Kung, Ling-Chieh and Chen, Ying-Ju, Focusing or Balancing? The Resource Allocation Problem for Demand Forecasting and Performance Measurement. Operations Research Letters, 40(1) 61-68, 2012, Available at SSRN: https://ssrn.com/abstract=2311042

Ling-Chieh Kung (Contact Author)

National Taiwan University - Department of Information Management ( email )

No.1,Sec. 4, Roosevelt Rd
Taipei
Taiwan

Ying-Ju Chen

Hong Kong University of Science & Technology (HKUST) - Department of Information Systems, Business Statistics and Operations Management ( email )

Clear Water Bay
Kowloon
Hong Kong

Hong Kong University of Science & Technology (HKUST) - Dept. of Industrial Engineering and Decision Analytics ( email )

Hong Kong

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