Industrial and
EIN 6918: Graduate Seminar
Spring 2008
January 31, 2008
3PM, MAEB 211
Demand Management
using Responsive Pricing and Product Variety in the Presence of Supply Chain
Disruptions
Saed Alizamir
Department of Industrial and Systems Engineering
Abstract
We consider a manufacturer that offers multiple variants in two brands of a product with long life-cycle. Due to supply breakdowns, the manufacturer may not be able to always offer both the brands in the marketplace. To mitigate the loss in demand when one brand is facing shortages, the manufacturer may influence customer choice either through a strategically designed product portfolio or price reduction of the available brand. The goal of this paper is to compare the relative impact of these two levers of demand management in the face of supply disruptions.