Professor Yehua Wei helps companies develop more flexible fulfillment networks
Adding this flexibility to the network also poses challenges, for example, increasing costs to maintain additional drivers, trucks, and routing software
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When companies develop strategic plans for the future, they need to account for a high level of uncertainty.
That’s where Yehua Wei’s research comes in. “The general theme of my research is decision under uncertainty,” he says. “These decisions have a long-term impact, involve a lot of uncertainty, and many downstream tactical issues that you need to consider.”
Wei is an associate professor of business administration in the Decision Sciences area at Duke University’s Fuqua School of Business and his research has many e-commerce applications. He recently partnered with one of China’s leading online retail companies to investigate the possibility of adopting a more flexible fulfillment network.
The solution was described in the paper “Understanding the Value of Fulfillment Flexibility in an Online Retailing Environment” published in the journal Manufacturing & Service Operations Management. Wei collaborated with Levi DeValve, an assistant professor at The University of Chicago Booth School of Business, and researchers Di Wu and Rong Yuan, who were both scientists at Chinese e-retailer JD.COM at the time of the study.
Wei and his co-authors evaluated the company’s distribution system, which contains two tiers of distribution centers: the local distribution centers—smaller warehouses responsible for fulfilling demand from their local district—and the regional distribution centers—bigger warehouses that function like “parents” of the smaller ones, supporting them when they run out of products.
[This article has been reproduced with permission from Duke University's Fuqua School of Business. This piece originally appeared on Duke Fuqua Insights]