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Incentives for Shared Services: Multiserver Queueing Systems with Priorities

Author

Listed:
  • Hanlin Liu

    (Division of Information Systems and Management Engineering, College of Business, Southern University of Science and Technology, Shenzhen 518055, China)

  • Yimin Yu

    (Department of Management Sciences, College of Business, City University of Hong Kong, Kowloon, Hong Kong SAR, China)

Abstract

Problem definition : We study shared service whereby multiple independent service providers collaborate by pooling their resources into a shared service center (SSC). The SSC deploys an optimal priority scheduling policy for their customers collectively by accounting for their individual waiting costs and service-level requirements. We model the SSC as a multiclass M / M / c queueing system subject to service-level constraints. Academic/practical relevance : Shared services are increasingly popular among firms for saving operational costs and improving service quality. One key issue in fostering collaboration is the allocation of costs among different firms. Methodology : To incentivize collaboration, we investigate cost allocation rules for the SSC by applying concepts from cooperative game theory. Results : To empower our analysis, we show that a cooperative game with polymatroid optimization can be analyzed via simple auxiliary games. By exploiting the polymatroidal structures of the multiclass queueing systems, we show when the games possess a core allocation. We explore the extent to which our results remain valid for some general cases. Managerial implications : We provide operational insights and guidelines on how to allocate costs for the SSC under the multiserver queueing context with priorities.

Suggested Citation

  • Hanlin Liu & Yimin Yu, 2022. "Incentives for Shared Services: Multiserver Queueing Systems with Priorities," Manufacturing & Service Operations Management, INFORMS, vol. 24(3), pages 1751-1759, May.
    • Handle: RePEc:inm:ormsom:v:24:y:2022:i:3:p:1751-1759
    DOI: 10.1287/msom.2021.1034
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    References listed on IDEAS

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