The Fast and Aﬀordable Delivery Problem – Operations Research Center

10/16/25 | 4:15pm | E51-145

Gerard Cachon

The Fred R. Sullivan Professor of Operations, Information, and Decisions
The Wharton School, University of Pennsylvania

Abstract: We study a delivery problem in which geographically dispersed demands are served from a central depot. The task is to choose a staﬃng level (number of servers) and an operating policy (when are servers dispatched and with which demands are they dispatched) to minimize the average response time to serve demand within a cost budget. The basic tradeoﬀs are plainly evident – serving more demand on each dispatch amortizes the eﬀort across more units but requires it takes time to assemble and serve dispatches with numerous units. We develop a novel universal lower bound on performance which is anchored around the first order task of managing the workload in the system. We use insights from the lower bound to better understand the fundamental economics of delivery systems.

Bio: Professor Cachon studies supply chain management, operation strategy and pricing with a focus on how technology transforms competitive dynamics and enables novel operational strategies. He is an INFORMS Fellow, a Fellow and former President of the Manufacturing and Service Operations Management Society, and the former Editor-in-Chief of Management Science as well as Manufacturing & Service Operations Management. He has authored two textbooks (along with Christian Terwiesch): Operations Management (2e) and Matching Supply with Demand: An Introduction to Operations Management (4e). These books have been used in undergraduate, MBA and executive MBA courses at Wharton as well as at numerous other business schools throughout the world. His articles have appeared in Management Science, Manufacturing & Service Operations Management, Marketing Science, Operations Research, the Quarterly Journal of Economics, and Harvard Business Review, among others.