Are droids better than drones for last mile delivery ?

An article in the Chicago Tribune (April 19, 2016) titled “Droids, not drones, are the future of e-commerce deliveries”, describes plans by Starship Technologies to develp mobile delivery robots to do home deliveries. The company claims that its robots weigh 35 pounds, can be tracked by video, hold 3 bags of groceries, travel 4 miles per hour on sidewalks and do not require any new approvals. The company claims that local retailers can break even with about 15 deliveries per day, a target delivery cost between $1.40 and $4.20 per delivery and a 3 mile radius for delivery.  But drone efforts at Amazon target delivery costs of $1 per package, a speed of 60 miles per hour and a weight of 5 pounds.  Will droids or drones end up solving the last mile delivery problem ? Will the FAA approval delays make delivery to homes less likely for drones int he near future ? Will the proposed “robot delivery as a service” enable shared use of these droids and thus make them affordable to small local businesses ?

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$3 billion worth cancer drugs wasted due to package size ?

An article in CNN.com titled “Why is $3 billion worth of cancer drugs being thrown away?” describes the 100 mg doses of the drug Keytruda, sold by Merck, and the 140 mg treatment requirement for a single patient, that leaves wasted leftover in the second vial used. If the patient volume is not high, the leftover medicine is wasted.The article describes lower wastage when drugs are available in multiple dosage sizes, thus enabling a better match with demand. What incentives should be provided to drug manufacturers to work to decrease drug wastage ? Should drugs be produced in much smaller vial sizes so that multiple vials may be required for a single dose across patient sizes? Should patients be charged only for the drugs used or also for the drugs wasted ?
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Product of Italy” or “Made in Italy” labels

An article in the New York Times (February 28, 2016) titled “Italy Growers Wary of Olive Oil Fraud as New Law is Weighed” , describes details of the “product of” law for olive oil as requiring use of Italian know how for blending even imported oluves, unlike the “made in” label which requires use of olives grown in Italy. The new label permits industry volumes to be maintained even when Italian olive crop drops, as the 2014 case when local olive production dropped by 50% due to fruit flies and olive tree disease. Should the focus be on the product volume preservation or on protecting the entire supply chain to be donestic? Will the focus on fines for violation vs criminal prosecution for labeling errors bring the process in line with other countries or encourage more fraud, given the estimated $66 billion misleading labeling of Italian sounding products? How should product quality be linked to location of  production so that consumers understand the potential impact during purchase?

Posted in consumer, Cost, Global Contexts, labeling, manufacturer, Prices, product, Sustainability, Uncategorized | 1 Comment

Will managing delivery logistics help Amazon improve service?

An article in the Wall Street Journal (December 23,2015) titled “Amazon Seeks to Ease Ties with UPS” describes the close relationship between the two companies evolving into one in which Amazon is now attempting to control it’s logistics costs, which have increased from 10.4% to 11.7% in the past year. Amazon is described as hiring UPS managers, reserving aircraft for delivering, working with USPS and focusing on increasing service while decreasing costs. Will Amazon be successful in launching it’s own logistics alternative and decreasing costs? What can UPS do to retain the business? Should UPS invest in drones and other technologies so Amazon can decrease it’s role?

Posted in Capacity, competitiveness, Cost, delivery, Ecommerce, Service Operations, Supply Chain Issues, Uncategorized | 2 Comments

Will shared luxury car buying succeed?

An article in the Financial Times (February 19, 2016) titled “Car-sharing tests boundaries of the motor industry” describe a company, Orto, that plans to offer four customers shared ownership of cars such as Jaguar F-type. Owners get access for 170 days over two years, up to two weeks at a time. They pay about 2500 pounds up front and 380 pounds a month. Will such shared ownership be the norm to increase utilization of luxury cars? Will such owners treat cars better than car renters? Does the new Ford initiative to allow 6 users to share a Ford pickup suggest that car manufacturers might benefit from this approach to generate sales?

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Will rethinking operations improve hospital outcomes?

An article in the New York Times (February 2, 2016) titled “Hospitals Focus on Doing No Harm”, describes the dramatic impact of operational changes on outcomes, with an eye to reducing the 75,000 preventable deaths nationwide. Orlando Health reports reducing patient infection related deaths by 44% with better procedures.   Minnesota Hospital Association reports reduction of pressure ulcers in patients confined to beds by 40% due to better coordination of care. Orlando Health reports a 32% decrease in blood clots in  patients in its seven hospitals by starting treatment for it faster when detected.  Should hospitals be held responsible for outcomes greater than the national average ? Should hospitals be held responsible for implementing state of the art treatment regimens ? In addition, should more successful hospital operations be rewarded for sharing their successes with others, to improve outcomes systemwide ?

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Will negative interest rates cause suppliers to demand later payments?

An article in the New York Times (February 12, 2016) titled “Negative 0.5 % interest rates: Why people are paying to save”, asks if suppliers, in a shift from the past, prevent buyers from paying up front. The logic is that upfront payments held in banks will create supplier costs. But will customers also shift their money to inventory which incurs physical storage costs but can avoid the fees for money. How will supply chains change in response to more rampant negative interest rates across the world? Will larger inventories at negative interest rate countries become the norm? Or will cash payments increase and thus create a different set if physical flow handling issues for retailers?

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