Assistant Professor in the Marriott School of Business at Brigham Young University
Clark Pixton is an Assistant Professor in the Marriott School of Business at Brigham Young University. His research focuses on personalization, online retail, and the implications of analytics for human-centered operations. Prior to joining BYU, he was a doctoral student in the Operations Research Center at MIT, where he worked with Professor David Simchi-Levi on statistics and optimization aspects of revenue management problems. Clark has consulted for PillPack, the successful pharmacy startup recently acquired by Amazon. He enjoys teaching innovative operations analytics classes for business students.
Track: Supply Chain
Monday, April 15, 1:50–2:40pm
Variance-Damping or Variance-Amplifying? A Look at Analytics in the Supply Chain
Analytics has increased firms’ ability to adapt their decision policies in response to incoming information. The benefits of such an ability are evident. However, we focus on an important but overlooked tradeoff, which comes from the fact that adaptive decision policies may introduce more variation into a business process than do their non-adaptive counterparts. We differentiate between “variance-damping” and “variance-amplifying” analytics, giving common examples of each. Our analysis includes foundational operational decisions such as inventory ordering and pricing, both of which have been the focus of much analytics research recently. Based on our theory, we give managerial insights for a firm’s analytics and supply chain strategies.