Kyung J. Min

Electric power generation planning for interrelated projects: a real options approach

The market uncertainties in the generation business in the U.S. electric power industry have increased the significance of two factors in generation planning: financial risks and managerial flexibilities. At the same time,numerous utilities have multiple generation planning projects that are interrelated with respect to their market values. For such utilities, in order to quantitatively address these two factors, in this paper, we develop and analyze a real options model for general n interrelated projects. Specifically, first, we derive a unique lattice process that approximates interrelated continuous processes for the evolution of values of projects and options (e.g., selling a constructed project). The steps of the approximation for n projects are presented progressively starting from two projects. Next, based on the lattice process, we investigate the impact of interrelation on the values of options. Then, we provide a backward dynamic programming model for optimal sequential decision making where the decisions are made over the options. Finally, managerial insights and economic implications are illustrated via numerical examples.

A Study of Product Weight and Collection Rate in Closed-Loop Supply Chains With Recycling

In the context of closed-loop supply chains (CLSCs), we investigate two critical environmental factors of the product weight and the collection rate, as well as their environmental consequence of the landfill quantity. There are three closely related CLSC models consisting of a manufacturer who also recycles used products and a collector of the used products. The first CLSC is a centralized model with the vertical integration of the manufacturer and the collector. The second CLSC is a decentralized model with the manufacturer as the leader and the collector as the follower in a Stackelberg game. The third CLSC is a decentralized model with government subsidy and fee. In addition, we formulate a nonrecycling model as a benchmark for comparison. Under this modeling framework, this paper shows the impacts of supply chain centralization/decentralization as well as government subsidy and fee on these two factors and their environmental consequence in terms of the disposal quantity at landfills. Throughout the paper, numerous managerial insights and policy implications are provided.

Developing students’ understanding of global issues through lean manufacturing

While traditional international exchange programs provide valuable experience for engineering students, they are neither within reach nor practical for all students. An innovative course was developed and executed Spring 2007 to provide engineering students with an intense international experience. This course is aimed at strengthening ABET outcome item (h) [the broad education necessary to understand the impact of engineering solutions in a global, economic, environmental, and societal context]. Additionally, the course provides students the opportunity to practice contemporary, industry-relevant skills by exploring lean manufacturing, including tools, philosophies, and current literature. In the first offering of the course, fifteen students participated on kaizen teams at companies in the United Kingdom and the United States. Survey results of student participants indicate that the experience increased studentspsila understanding of global issues and lean manufacturing. Feedback from industrial partners also showed that this was an effective exercise for developing studentspsila understanding of these issues. This paper describes the creation of this course, including the assessment data that provided the impetus for its inception. Course content, structure, and activities are detailed. Survey results are examined. Long term impact expectations and assessment plans are described.