• About
  • Policies
  • What is openaccess
  • Library
  • Contact
Advanced search
      View Item 
      •   BUIR Home
      • Scholarly Publications
      • Faculty of Engineering
      • Department of Industrial Engineering
      • View Item
      •   BUIR Home
      • Scholarly Publications
      • Faculty of Engineering
      • Department of Industrial Engineering
      • View Item
      JavaScript is disabled for your browser. Some features of this site may not work without it.

      A simulation-based support tool for data-driven decision making: operational testing for dependence modeling

      Thumbnail
      View / Download
      159.5 Kb
      Author
      Biller, B.
      Akçay, Alp
      Çorlu, C.
      Tayur, S.
      Date
      2014
      Source Title
      Proceedings of the 2014 Winter Simulation Conference, WSC 2014
      Print ISSN
      0891-7736
      Publisher
      IEEE
      Pages
      899 - 909
      Language
      English
      Type
      Conference Paper
      Item Usage Stats
      130
      views
      102
      downloads
      Abstract
      Dependencies occur naturally between input processes of many manufacturing and service applications. When the dependence parameters are known with certainty, the failure to factor the dependencies into decisions is well known to waste significant resources in system management. Our focus is on the case of unknown dependence parameters that must be estimated from finite amounts of historical input data. In this case, the estimates of the unknown dependence parameters are random variables and simulations are designed to account for the dependence parameter uncertainty to better support the data-driven decision making. The premise of our paper is that there are certain cases in which the assumption of an independent input process to minimize the expected cost of input parameter uncertainty becomes preferable to accounting for the dependence parameter uncertainty in the simulation. Therefore, a fundamental question to answer before capturing the dependence parameter uncertainty in a stochastic system simulation is whether there is sufficient statistical evidence to represent the dependence, despite the uncertainty around its estimate, in the presence of limited data. We seek an answer for this question within a data-driven inventory-management context by considering an intermittent demand process with correlated demand size and number of interdemand periods. We propose two new finite-sample hypothesis tests to serve as the decision support tools determining when to ignore the correlation and when to account for the correlation together with the uncertainty around its estimate. We show that a statistical test accounting for the expected cost of correlation parameter uncertainty tends to reject the independence assumption less frequently than a statistical test which only considers the sampling distribution of the correlation-parameter estimator. The use of these tests is illustrated with examples and insights are provided into operational testing for dependence modeling.
      Keywords
      Cost accounting
      Decision making
      Decision support systems
      Inventory control
      Parameter estimation
      Statistical tests
      Stochastic systems
      Waste management
      Correlation parameters
      Data driven decision
      Decision support tools
      Independence assumption
      Parameter uncertainty
      Sampling distribution
      Service applications
      Statistical evidence
      Uncertainty analysis
      Permalink
      http://hdl.handle.net/11693/28219
      Published Version (Please cite this version)
      http://dx.doi.org/10.1109/WSC.2014.7019950
      Collections
      • Department of Industrial Engineering 677
      Show full item record

      Related items

      Showing items related by title, author, creator and subject.

      • Thumbnail

        Progression of color decision making in introductory design education 

        Ural, S. E.; Akbay, S.; Altay, B. (Wiley, 2017-04)
        Color comprises both subjective and objective aspects within its contextual nature. Research on color design tends to explore this seemingly contradictory concerns from theoretical point of view, as well as architectural ...
      • Thumbnail

        A game theoretical modeling and simulation framework for the integration of unmanned aircraft systems in to the national airspace 

        Musavi, Negin; Tekelioğlu, K. B.; Yıldız, Yıldıray; Güneş, Kerem; Onural, Deniz (AIAA, 2016)
        The focus of this paper is to present a game theoretical modeling and simulation frame- work for the integration of Unmanned Aircraft Systems (UAS) into the National Airspace system (NAS). The problem of predicting the ...
      • Thumbnail

        Examining proactive strategic decision-making flexibility in new product development 

        Kandemir, D.; Acur, N. (Wiley-Blackwell Publishing, 2012)
        While strategic flexibility is widely accepted as a prerequisite for a firm's success, its application in strategic decision making to a firm's new product development (NPD) activities is limited to only a few studies. ...

      Browse

      All of BUIRCommunities & CollectionsTitlesAuthorsAdvisorsBy Issue DateKeywordsTypeDepartmentsThis CollectionTitlesAuthorsAdvisorsBy Issue DateKeywordsTypeDepartments

      My Account

      Login

      Statistics

      View Usage StatisticsView Google Analytics Statistics

      Bilkent University

      If you have trouble accessing this page and need to request an alternate format, contact the site administrator. Phone: (312) 290 1771
      Copyright © Bilkent University - Library IT

      Contact Us | Send Feedback | Off-Campus Access | Admin | Privacy