{"73667":{"#nid":"73667","#data":{"type":"news","title":"Real-time Business Data Can Hurt Decision-making","body":[{"value":"\u003Cp\u003EWhile technological advances are enabling managers to track the flow of goods in the supply chain minute by minute, such close monitoring might not provide the benefits that many businesses expect, according to a new study.\u003C\/p\u003E\n\u003Cp\u003EBy allowing faster response to new developments, real-time tracking should theoretically help managers make better business decisions, but the opposite is sometimes true, find Nicholas Lurie, assistant professor of marketing at Georgia Tech College of Management, and Jayashankar Swaminathan, an operations professor at the University of North Carolina at Chapel Hill.\u003C\/p\u003E\n\u003Cp\u003EThe frequent feedback provided by supply-chain monitoring tools like Radio Frequency Identification Technology - small chips attached to pallets, cases or individual product units for remote tracking - might cause managers to overreact to random fluctuations in demand, responding to the most recent data received instead of examining the bigger picture, explain the researchers in their working paper, \u0022Is Timely Information Always Better? The Effect of Feedback Frequency on Performance and Knowledge Acquisition.\u0022\n\u003C\/p\u003E\n\u003Cp\u003E\u0022If retailers could choose to receive a monthly, weekly or daily recap of Campbell\u0027s tomato soup sales, which recap frequency would they choose? Many would select the daily recap, thinking it would give them a competitive edge,\u0022 Lurie says. \u0022However, our study finds that when a manager is given more frequent information on product demand, decision-making performance actually decreases, particularly in environments characterized by a high degree of variability.\u0022\n\u003C\/p\u003E\n\u003Cp\u003EReal-time feedback affects many types of business activities beyond supply-chain management. For example, online stock traders\u0027 performance seems to suffer from too much information. Previous research suggests that they tend to trade more frequently in response to price movements that might simply be random, Lurie notes. \n\u003C\/p\u003E\n\u003Cp\u003EHe and Swaminathan studied the effect of feedback frequency on performance using two computer-based experiments, in which subjects acted as newsvendors dealing with inventory orders, and a \u0022virtual factory\u0022 management simulation giving participants an opportunity to apply concepts such as inventory management, lot sizing, and process control in a realistic environment. \n\u003C\/p\u003E\n\u003Cp\u003EBased on their results, the researchers advise managers using technologies that provide frequent feedback to temper their reactions to the most recent data received. \n\u003C\/p\u003E\n\u003Cp\u003EFor more information, contact Lurie at 404-894-4380 or \u003Ca href=\u0027mailto:nicholas.lurie@mgt.gatech.edu\u0027\u003Enicholas.lurie@mgt.gatech.edu\u003C\/a\u003E.\n\u003C\/p\u003E\n\u003Cp\u003E\u003Cstrong\u003EWriter:\u003C\/strong\u003E Brad Dixon, College of Management\n\u003C\/p\u003E","summary":null,"format":"limited_html"}],"field_subtitle":"","field_summary":[{"value":"While technological advances are enabling managers to track the flow of goods in the supply chain minute by minute, such close monitoring might not provide the benefits that many businesses expect, according to a new study.","format":"limited_html"}],"field_summary_sentence":[{"value":"Managers can overreact to minute-by-minute tracking"}],"uid":"27301","created_gmt":"2006-01-20 01:00:00","changed_gmt":"2016-10-08 03:02:23","author":"Elizabeth Campell","boilerplate_text":"","field_publication":"","field_article_url":"","dateline":{"date":"2005-12-08T00:00:00-05:00","iso_date":"2005-12-08T00:00:00-05:00","tz":"America\/New_York"},"extras":[],"hg_media":{"73668":{"id":"73668","type":"image","title":"Nicholas Lurie","body":null,"created":"1449178012","gmt_created":"2015-12-03 21:26:52","changed":"1475894380","gmt_changed":"2016-10-08 02:39:40"}},"media_ids":["73668"],"related_links":[{"url":"http:\/\/mgt.gatech.edu\/directory\/lurie.html","title":"Nicholas Lurie\\\u0027s Website"},{"url":"http:\/\/mgt.gatech.edu\/","title":"Georgia Tech College of Management"}],"groups":[{"id":"1214","name":"News Room"}],"categories":[],"keywords":[],"core_research_areas":[],"news_room_topics":[],"event_categories":[],"invited_audience":[],"affiliations":[],"classification":[],"areas_of_expertise":[],"news_and_recent_appearances":[],"phone":[],"contact":[{"value":"\u003Cstrong\u003ELisa Grovenstein\u003C\/strong\u003E\u003Cbr \/\u003ECommunications \u0026amp; Marketing\u003Cbr \/\u003E\u003Ca href=\u0022http:\/\/www.gatech.edu\/contact\/index.html?id=lgrovenste3\u0022\u003EContact Lisa Grovenstein\u003C\/a\u003E\u003Cbr \/\u003E\u003Cstrong\u003E404-894-8835\u003C\/strong\u003E","format":"limited_html"}],"email":["lisa.grovenstein@comm.gatech.edu"],"slides":[],"orientation":[],"userdata":""}}}