While brick and mortar retail is facing the biggest challenge in years, retail stores as a channel are not going away. The key to running a successful brick and mortar store lies in executing a careful trade-off between high efficiency and high customer experience. An excellent work by an operations colleague Kesavan shows that “treating your employees with stable schedules” does not have to be a trade-off.
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How to think about the role of Artificial Intelligence in Operations? Many people talk up AI, IoT, automation, etc, as the Fourth Industrial Revolution (following steam power, electricity, and computerization). Here is an example. I am more persuaded by the counter-arguments. For example, see a post by Luke Muehlhauser arguing there was only one industrial revolution, because one of the revolutions is substantively larger than, and different from the others, as exhibited in the figure below (data from the site). The Second Machine Age, by Erik Brynjolfsson and Andrew McAfee, which ironically, I read on paper, explores the effects of the rapid digitization and information technological advances (AI, Automation, etc) on the nature of work, wealth and society. Brynjolfsson and McAfee…
Leave a CommentWired Magazine reports that San Francisco is planning to adjust parking spot prices based on demand, essentially moving to dynamic pricing of parking spots. Note that SF has been experimenting with the dynamic pricing of spots already. This proposal by San Francisco Municipal Transportation Agency (SFMTA) — which has not been voted by the City Council yet — expands the dynamic pricing spots from the current 7000 meters to 28,000 meters. I’ll make 4 salient points about the issue: (a) Success depends on operational transparency, (b) Roads utilization, not spots, is the main source of congestion, (c) Dynamic pricing may not improve utilization, and (d) Dynamic pricing may hurt consumer welfare. (In fact, I will discuss research evidence that SFPark…
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