Then, we discuss character of these markets by interrupting concrete cases of a cooked curry market and a heavy detergent market.

Title:

Bicriteria Robustness versus Cost Optimisation in Tour of Duty Planning at Air New Zealand (postscript version or pdf version)

Authors:

Matthias Ehrgott and David M. Ryan, Department of Engineering Science, University of Auckland

Current optimisation based computer systems to solve all aspects of both planning and rostering processes for both national and international airline operations allow the construction of minimal cost tours of duty and rosters. However, today major airlines do not only require cost effective solutions, but are also very interested in robust solutions. A more robust solution is understood to be one where disruptions in the schedule (due to delays) are less likely to be propagated into the future, causing delays of subsequent flights. Current scheduling systems based solely on cost do not automatically provide robust solutions.

These considerations lead to a multiobjective framework, as the maximisation of robustness will be in conflict with the minimisation of cost, as for example crew changing aircraft between duties is discouraged if inadequate ground time is provided. We develop a bicriteria optimisation framework to generate "efficient" schedules for the domestic airline. An efficient schedule is one which does not allow an improvement in cost and robustness at the same time.

In this talk, we present preliminary results on the incorporation of a robustness objective in the optimisation process. We also outline future research to be undertaken in this area.

Title:

Types of Market Research and its Usefulness: An Empirical Study (postscript version or pdf version)

Authors:

Ganeshasundaram Raguragavan, Tony Lewis and Zane Kearns, Department of Marketing, Massey University

Much of the literature on market research begins with the premise that information plays a critical role in the success or failure of organisations. However, information acquired by decision makers will have little impact on company performance if it is not actually put to use in the making of decisions. Clearly, the type of information available, and the use to which it is put, are the deciding features in the value of information. However, with very few exceptions, the literature has tended to focus on the how and what of gathering market information, rather than on the usefulness of such information, once it has been acquired.

Kohli and Jaworski (1990) write that if market intelligence and marketing research generated information is to play a critical role in a firm's quest to become more market oriented, relevant information must be produced and disseminated to the various departments in the most appropriate form to enhance its use. Moreover, there is likely to be "bad" research and "good" research, though this distinction carries within it the seeds of circular reasoning. Hart and Diamantopoulos (1993) found that the level of use of marketing research had no apparent effect on the organisations' performance. They argued that what really matters is not what information is collected or from where it is obtained. Instead, the crucial question is how good is the information gathered, and how effectively it is used. Hart and Diamantopoulos (1993) did not attempt to explore possible explanations for their finding of an insignificant relationship between research activity and success. It is probably the case that different types of marketing research have different effects.

The literature on research use has revealed the existence of two key dimensions in the evaluation of research: namely, instrumental and conceptual. Instrumental use or what in this paper is termed 'decision research' has been defined as the direct application of research findings and conclusions to solve a specific problem, or to make a particular decision (Deshpande and Zaltman, 1982). Conceptual use or 'background research' information refers to the indirect application of information, in the sense that information is used to broaden the managerial knowledge base without serving any one particular project (Moorman, 1995).

This paper reports on part of a large scale study investigating the relationship between the type of marketing research on the one hand, and company performance on the other. We specifically explore the relationship between the purpose for which research has been commissioned, and managers' perceptions of the usefulness of the information provided by the research. It was developed from the univariate findings reported in an earlier conference paper, by using multivariate analysis. The data were collected by personal interviews and a mail questionnaire. The results from 34 New Zealand organisations and 775 research projects, suggest that if the research is conducted with the specific purpose of helping to make a decision, it is evaluated more favourably than if it is conducted to provide background information. Background research predominates over decision research as the research activity of choice, yet is regarded as less useful. A possible explanation for the predominance is that it is the prevailing convention among research companies and marketers. The results of our research suggests that the emphasis should be changed.

Title:

Cell Batching Optimisation for the New Zealand Aluminium Smelter (postscript version or pdf version)

Author:

Thorsten Piehl, Department of Engineering Science, University of Auckland

New Zealand Aluminium Smelter (NZAS) in Tiwai Point produces aluminium in tapping bays of 48 to 51 electrolysis cells. Three cells are tapped into one batch. A tapping bay consists of up to 17 batches. The purity of the aluminium produced differs from cell to cell. The premium of a batch increases more than linear with increasing purity. The objective of the cell batching process is it to maximise the overall premium of a tapping bay by choosing the optimal combination of batches.

The cell batching process is modelled as a Set Partitioning Model. This model is solved using the Revised Simplex Method and Branch-and-Bound (B&B) with a constraint branching approach.

This approach has difficulties solving the smelter problem to optimality because the LP-IP gap and the B&B-tree, which has to be explored, are large.

Improvements of the existing approach for dealing with the LP-IP gap and the tree size have been implemented.

This paper outlines the improvement of the software currently used for the cell batching process of NZAS.

Title:

BartSim: A Tool for Analysing and Improving Ambulance Performance in Auckland, New Zealand (postscript version or pdf version)

Authors:	Shane G. Henderson, Industrial and Operations Engineering Department, University of Michigan, Michigan, USA
	Andrew J. Mason, Department of Engineering Science, University of Auckland

The problem of determining where ambulances should be stationed, and at what times they operate, has received a great deal of attention in the literature. The trade-off driving this work is between additional resources to improve response times to emergency calls, and the cost of those additional resources. We discuss a simulation and analysis software tool BartSim that has been developed by the authors as a strategic decision support tool for use within the St John Ambulance Service (Auckland Region) in New Zealand (St Johns). The novel features incorporated within this study include the use of a detailed time-varying travel model for modelling travel times in the simulation, methods for reducing the computational overhead associated with computing time-dependent shortest paths in the travel model, and the development of a geographical information sub-system (GIS) within BartSim that provides spatial data visualisation exploring both historical data and the results of simulations. Our experience with St Johns, and discussions with emergency operators in Australia and Europe, suggest that the emergency services do not have good tools available to support their operations management at the strategic level. Our experience has shown that a customised system such as BartSim can successfully combine GIS and simulation approaches to provide a quantitative decision support tool highly valued by managers.

Title:

Optimal Sailing Routes with Uncertain Weather (postscript version or pdf version)

Authors:

Toby Allsopp, Andrew J. Mason and Andy Philpott, Department of Engineering Science, University of Auckland

We consider the problem of finding a route that minimises the expected sailing time between two points on the ocean under uncertain weather conditions. This has applications in long distance offshore yacht racing. The uncertainty in the weather is modelled by a branching scenario tree that captures the serial correlation inherent in the evolution of weather systems over time. The stochastic solution method extends a deterministic dynamic programming approach to include the weather scenario as a state variable, yielding a stochastic dynamic programming algorithm. Careful attention to implementation details yields an approach that optimises with uncertainty while maintaining acceptable solution times on a PC. This paper summarises the work presented in Allsopp (1998).

Title:

On an Application of Pedigree Approach to Symmetric Traveling Salesman Problem (postscript version or pdf version)

Author:

Tiru Arthanari, Department of Engineering Science, University of Auckland

Arthanari(1982) gave an alternative formulation for the Symmetric traveling salesman problem (STSP), based on multi stage insertion decisions. In a recent paper Arthanari and Usha(2000) study some of the properties of this formulation. The classical STSP polytope is generally studied as embedded in the standard sub tour elimination polytope (SEP). Boyd & Pulleyblank(1991) study the structure of the vertices of SEP and identify two classes of fractional vertices to show how complex they can be. Arthanari (1999) introduced the objects called pedigrees which are in 1-1 correspondence with the tours. The convex hull of these pedigrees yields a new polytope, called the pedigree polytope. In this paper, we apply some of the necessary and sufficient conditions for membership in pedigree polytope developed in Arthanari(1999), to show that some vertices of SEP identified by Boyd & Pulleyblank(1991) are not in the corresponding STSP polytope.

Title:

Automated Load Planning

Author:

Simon A. Brandon, PA Consulting Group, Wellington

This talk presents an introduction to automated truck loading and its industrial application. We will start by outlining the truck loading problem and examining the current state of the art in loading and packing problems.The next part of the talk will look at different algorithmics alternatives for loading trucks. We will discuss several different approaches describing the pros and cons of each. We will then examine a truck loading application that PHB Hagler Bailly built to automate truck loading for a very large client in the United States. In order to address these issues PHB developed T3, an automated load planning system. The loading personel can download shipment information from the client's database, and produce good feasible solutions. The loader can then load the shipments on the trailers following the T3 load diagrams. At the end of the talk we will provide a demonstration of T3 in action.

Title:

A Gibbs Sampler Approach to Estimate the Number of Faults in a System Using Capture-recapture Sampling

Authors:	Yu Hayakawa, Victoria University of Wellington
	Paul S.F. Yip, The University of Hong Kong, Hong Kong, China

A new recapture debugging model is suggested to estimate the number of faults in a system, $\nu$, and the failure intensity of each fault, $\phi$. The Gibbs sampler and the Metropolis algorithm are utilised in the proposed inference procedure. A numerical illustration suggests a notable improvement on the estimation of $\nu$ and $\phi$ compared with that of a removal debugging model.

Title:

A Dynamic Model for Structuring Decision Problems (postscript version or pdf version)

Authors:	Jim Corner and John Buchanan, Department of Management Systems, University of Waikato
	Mordecai Henig, Tel Aviv University, Tel Aviv, Israel

This paper develops a new model of decision problem structuring which synthesises a number of models and approaches cited in the decision making literature in general and the multi-criteria literature in particular. The model advocates a dynamic interaction between criteria and alternatives as a decision maker understands his preferences and expands the set of alternatives. This model endeavours to bridge the gap between prescriptive and descriptive approaches. It is prescriptive in its orientation, recommending an approach based on earlier prescriptive work. The model, however, is also validated empirically, based on the descriptive decision making literature and reported case studies of actual decision making.

Title:

Flight Schedule Optimisation for Air New Zealand's International Fleet (postscript version or pdf version)

Author:

Rochelle Meehan, Air New Zealand

Air New Zealand had done very little work in the area of aircraft scheduling using optimisation techniques until last year. A basic optimisation model was develped to allocate flights and maintenance to aircraft over a period of time. This project implements several extensions to this model. Departure time windows were incorporated to allow flexibility within the flight schedule. Each of the individual sectors were also allocated a priority. These priorities were then used to reduce the number of aircraft in the fleet. A linear programming (LP) relaxation and branch and bound approach was used to solve this model as a generalised set-partitioning problem. This approach led to the efficient construction of a good quality legal solution of the Boeing 747-400 fleet.

Title:

Electricity Market Models: Primal/Dual Formulation Issues

Authors:

E. Grant Read and Deb Chattopadhyay, Department of Management, University of Canterbury

Recent years have seen the development of electricity markets in many parts of the world, with most of those markets being "cleared" by Linear Programming models. Such models must produce optimal "primal" dispatch schedules, but also "dual" pricing schedules which not only match those dispatch schedules, but also comply with the market pricing rules. By and large, these twin goals can be met using a formulation in which the system representation closely matches physical reality, but many markets rely on simplified system representations. Typically, the natural "nodal" structure of the transmission network may be reduced to a relatively small set of transmission zones, constraints may be derived using statistical correlations, or variables appearing in constraints may be modelled as constants. We will examine the impact of each of these simplifications on pricing, and show that there are often alternative constraint representations which produce exactly the same primal solution, but very different prices. But, naturally, traditional constraint representations have been chosen with a view to ease of expression, or computation, with no regard to dual implications at all. Thus we conclude that the choice of constraint representation can have significant implications in market clearing models for electricity, and presumably for other commodities, too.

Title:

Stakeholder Analysis for Systems Thinking and Modelling (postscript version or pdf version)

Authors:

Arun Abraham Elias, Robert Y. Cavana, School of Business and Public Management, Victoria University of Wellington

Problem structuring is a common first step in most problem-solving approaches. In the systems thinking and modelling framework, the problem-structuring phase is followed by causal loop modelling, dynamic modelling, scenario planning & modelling, and implementation & organisational learning. In this paper we explain how and why stakeholder analysis would enrich the problem-structuring phase in the systems thinking and modelling process. We also argue that stakeholder analysis is applicable for other problem solving approaches. We demonstrate the usefulness of stakeholder analysis in systems thinking and modelling by presenting a New Zealand case study.

Title:

A Practical Application of Multi Criteria Methods Using Decision Support Software

Author:

Kieran Turner, Decision Lab Limited, Auckland

The aim of this presentation is to discuss the role of decision support software in the decision process. Multi criteria decisions are by nature complex and many methods for structuring and evaluating these decisions have been formulated. In this paper I present an overview of our work and experience to date using Logical Decisions, a decision support software package that utilises Multi Attribute Utility Theory (MAUT) and the Analytic Hierarchy Process (AHP). This type of decision support software can greatly assist both the decision makers and the analyst/decision team. It allows greater insight to be obtained and a better quality decision can be achieved. A case study will be presented demonstrating how the software has been of assistance in a real world application.

Title:

Optimal Reactive Power Management in Electric Power Systems

Authors:	Bhujanga B. Chakrabarti, Network Planning Group, Transpower NZ Limited
	E. Grant Read and Deb Chattopadhyay, Department of Management, University of Canterbury

In an electric power system, the loads at the customer ends consume both active and reactive power. The active power is converted into heat, light or other form of useful energy. On the other hand, reactive power can not be converted into a useful form but its existence is an inherent part of electrical loads. Reactive power must be carefully managed to ensure optimal utilisation of real power, to maintain voltage profile and also to avoid system-wide catastrophic events such as voltage collapse.

Reactive power management in a broad sense includes a range of issues including decisions on installation of reactive power sources (where, how much, and when), allocation of the associated costs among the responsible agents (e.g., customers/loads), and finally dispatch/pricing of reactive power in real-time. Voltage stability is a critical consideration in all these facets of reactive power management because its ultimate goal is to avoid a catastrophic event.

The reactive power (VAR) planning process is involved in deciding the worst contingency the system is to be protected against, location of installation of VAR equipment, the requirements of optimal amount of VAR at different locations and the voltage stability margin. The objective of VAR planning is to maintain satisfactory voltage profile and voltage stability across the network under normal and contingency conditions. The operating point should be maintained at a distance, in terms of MVA, from the point of voltage collapse (also called the critical point or the PoC) to provide safety margin from the PoC for unforeseen events beyond planning criteria.

The need for reactive power pricing is now well recognised. The theory and computational aspects of reactive power pricing have been topics of research for almost a decade. Development of optimal dispatch/pricing market models that can account for various complex power system phenomena involving reactive power has started receiving attention in recent years. Although various short run reactive power pricing schemes have been discussed and debated in the literature for a decade, voltage stability, which is often a critical determinant of reactive power allocation in many systems, has rarely been discussed in the dispatch/pricing literature. Voltage stability constrained power systems pose a difficult challenge for model development, analysis and implementation. Stability aspects have often been incorporated in the real-life dispatch/pricing procedure using trial and error methods, or approximated in the dispatch optimisation directly as a set of linear constraints on generation/transmission.

This paper briefly discusses a VAR planning model. A contingency constrained optimal power flow (OPF)-based model incorporating (static) voltage stability constraints is developed to analyse VAR support decisions. The model is contingency constrained i.e., given a set of contingencies, it performs the contingency ranking, decides optimal locations and quantity of VAR support to cover the worst contingency and simultaneously ensures that no other contingency constraint is violated. The contingencies are ranked endogenously based on the stability margin. DICOPT++, a state-of-the-art mixed integer non-linear programming (MINLP) algorithm, is proposed to solve the model efficiently. The model is tested for a test system.

The paper also presents preliminary experiences with the development of an OPF model that optimally allocates real and dynamic reactive reserves among the generators to meet a pre-specified voltage stability margin. The model deals with two states: A base dispatch to meet the current loads; and a contingency/collapse related reserve dispatch to ensure that the system has enough MW and MVAr reserve available to meet the required stability margin. The impact of the voltage stability constraints on nodal prices is of special interest. Experiments conducted for a simple 3-node system with zero and non-zero reserve offers for reactive power reveal some interesting impact of the voltage stability constraint on real and reactive power prices.

Title:

Te Wananga: Developing a Bicultural Model Using Critical Systems (postscript version or pdf version)

Authors:

Wayne Taurima and Michael Cash, The Open Polytechnic of New Zealand

(No abstract submitted)