Increasingly, due to shortening product life cycles and capital-intensive capacity decisions, companies are being forced to place greater emphasis on managing constrained, but perishable inventory and capacity. In this course, we study quantity and pricing strategies to improve profitability. The main goals of this course are to provide the insights and tools that will enable students to: (1) be able to identify pricing and revenue opportunities; (2) understand the critical differences among different types of opportunity and the approaches needed to address them; (3) understand key concepts including the impact of constrained capacity, opportunity costs, customer response, demand uncertainty, and market segmentation; and (4) be able to formulate and solve pricing and revenue optimization decisions as constrained optimization problems at the level necessary to estimate potential benefits. The focus of the course will be on imparting a broad understanding and grasp of basic techniques rather than the technical nuances of a particular algorithm.
Prerequisite(s): BQOM 2401 Statistical Analysis and BQOM 2421 Decision Technologies