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Short Takes on the Literature - In the burgeoning literature on engineering systems and related fields, we can all use some navigational aids. To that end, the ESD Working Paper series introduces a new feature "Short Takes on the Literature" in which brief informal commentaries by MIT people on books, reports and papers in our field are made available to the community. We hope you find these of value and will also see fit to contribute your own opinions on the literature as well.

List of Papers for 2008:
(in reverse chronological order)

ESD-WP-2008-22 Linking Historical Roots and Current Methodologies of Engineering Systems

by Nidhi Santen
PhD Student, MIT Engineering Systems Division

Danielle Wood
PhD Student, MIT Engineering Systems Division

This paper reviews the historical context and present impact of two sets of literature: the work of Joseph Schumpeter and the field of Strategy Development. Schumpeter’s theories about the impact of technology or innovation on the economy are an important input into modern Engineering Systems (ES) thinking. Meanwhile, Strategy Development is an active contemporary methodology that is relevant to Engineering Systems. Both Schumpeter and the scholars in Strategy Development are concerned with how firms perform, but Schumpeter's approach is descriptive while Strategy Development is prescriptive.

The approach in this paper is as follows. It first introduces the theories of Schumpeter on innovation and the major ideas within Strategy Development. Next, two historical reviews are presented. One review looks forward to find the impact that Schumpeter has had on modern fields; the second review looks backward to understand the roots of Strategy Development. These historical reviews are initially done independently. The final section asks whether there are direct historical links between Schumpeter and the scholars or ideas of Strategy Development. The major result of this investigation is that Schumpeter’s influence is widespread as are the roots of Strategy Development. The results also show that the writing of Schumpeter is related to Strategy literature because many of Schumpeter’s ideas have become foundational realities for Strategy Development. Meanwhile, this connection is just one of many for each field, and the link between Schumpeter and Strategy Development does not appear to be the most important.

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ESD-WP-2008-21 America Disrupted: Dynamics of the Technical Capability Crisis

by Dan Sturtevant
PhD Student, MIT Engineering Systems Division

This study investigates the cause of the nearly twenty-five year decline in the percentage of U.S. born undergraduates earning degrees in engineering. This dramatic decline has occurred despite incredibly high pay and low unemployment among individuals holding engineering degrees. On the surface, this situation appears to be violating the basic laws of labor-market supply and demand. A system dynamics model was created to represent the institutional forces and feedback loops present in the real-world system. This model internally represents the economic forces governing the choice to pursue science, technology, engineering, and mathematics (STEM) education, distinguishing features of highly quantitative knowledge that constrain its transmission, and factors determining the overall quality of STEM education in our schools.

This work presents a theory that high industry pay for STEM workers and low pay for STEM K-12 teachers directly cause long-term labor shortages that are self perpetuating. A scarcity of STEM workers will cause wages to rise as employers bid up the price of those skills in the short-term. Schools are left with fewer qualified and lower quality teachers. This makes labor shortages worse ten to twenty years down the road. The fact that mathematics knowledge is highly sequential with strong dependencies on past-performance exacerbates the situation. Students who fall behind in mathematics find it nearly impossible to catch up. This work explores many societal shifts that occurred in the 1950‘s through 1980‘s that could have resulted in the perplexing behavior seen from 1985 until the present day. Finally, policy proposals to correct the situation are simulated in the model to test their ability to move the system in a more positive direction. The system is found to exhibit "tipping point" behavior. Small reforms will have negligible impact while larger reforms have the potential to make the system move into a fundamentally better pattern of behavior, but only after considerable delays.

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ESD-WP-2008-20 The Progress in Wireless Data Transport and its Role in the Evolving Internet

by Mario A. Amaya
Engineering Systems Division, MIT

Christopher L. Magee
Engineering Systems Division, MIT

The progress of wireless technology through the past 105 years is quantitatively reviewed in this paper. Spectral efficiency and coverage density are both found to increase in a relatively continuous exponential fashion over the entire period with spectral efficiency increasing at about 15% per year and coverage density at about 33% per year. Throughput by wireless technology was not found to follow a single exponential but instead followed an exponential with annual increase of only 5% up to the late 70s and since then (and the introduction of the cellular concept) has followed an exponential with annual increases of greater than 50%. These high rates of progress in the functional performance of wireless technology are an essential enabler for wireless interfaces to become the dominant mode for connecting to the Internet.

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ESD-WP-2008-19 Technology-Enabled Strategy Development Alternatives for Surface Transportation

by Travis P. Dunn
MIT

Joseph Sussman
Professor of Civil and Environmental Engineering and Engineering Systems, MIT

This paper examines strategy development processes in surface transportation systems. In the U.S., transportation organizations typically develop strategy through a formal planning process; however, planning is not the only approach for developing strategy. Other approaches include, for example, negotiation, visioning, learning, and consensus-building. Regardless of the particular approach or combination of approaches, strategy development processes have several elements in common. We identify four such elements of particular importance in surface transportation – revenue sources, information sources, temporal scales, and spatial scales – and analyze the impact that advancements in transportation technology have had on each element. While new technologies (e.g. Intelligent Transportation Systems, or ITS) have been applied extensively to improve transportation operations, they have not been used to enable innovative strategy development processes. By understanding more fully the relationships between strategy and technology, organizations may consider adoption of innovative strategy development processes, such as improvements to the planning process or alternatives to planning altogether.

*Corresponding author

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ESD-WP-2008-18 Design of Ground Delay Programs Considering the Stakeholder Perspective

by Michael Hanowsky
MIT

Joseph Sussman
Professor of Civil and Environmental Engineering and Engineering Systems, MIT

A Ground Delay Program (GDP) is an initiative used by the FAA to manage the rate at which aircraft demand arrival at capacity-constrained airports. In this paper, we adapt a framework developed by Mitchell et al. (1997) to identify and determine the importance of the key stakeholders in the design of a GDP. Comparing our results with current practice, we find that passengers and the federal government do not receive consideration that is commensurate with their level of importance. We conclude with suggestions for how the FAA might address this disparity in the design of GDPs.

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ESD-WP-2008-17 Will Nano-Butlers Work for Micro-Payments?
Innovation in Business Services Model may Reduce Cost of Delivering Global Healthcare Services

by Shoumen Palit Austin Datta,
Massachusetts Institute of Technology

This paper represents an emerging view of personalized care and patient-centric systems approach. It integrates biomedical informatics and business services. A potentially innovative model may evolve from this convergence and may serve as a global template to reduce cost of service. The future of global healthcare may increasingly rely on “sense and then, respond” systems but excluding the instances of exception management, necessary for accidents and emergencies. Solutions suggested in this paper are neither complete nor a panacea but are elements that deserve inclusion in the delivery of healthcare that may combine a portfolio of approaches to suit the needs of the community. As a potential future direction to improve analytics in healthcare, the concept of molecular semantics is proposed.

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ESD-WP-2008-16 Collaborative Systems Thinking: A survey of literature in search of team-level systems thinking within aerospace teams

by Caroline Twomey Lamb
Doctoral Candidate, Department of Aeronautics and Astronautics,
Lean Advancement Initiative

This literature review was prepared in support of research investigating team-level systems thinking. Three critical constructs were identified-team, process, and culture-and the pertinent literature is explored in this white paper. The research focused on the aerospace industry, and as such, this white paper uses illustrative examples from the aerospace industry wherever possible. A fourth construct, that of team-level or collaborative systems thinking, is also addressed. This fourth construct is a new construct put forth by the author and her advisors.

This white paper is divided into two main section. The first motivates research on team-level systems thinking as a solution to the growing gap between engineering design and engineering analysis. The second section treats the four critical research constructs identified above. For the first three constructs, a definition is provided based on available literature, examples grounded in aerospace are provided, common metrics are introduced, and threats to validity are discussed. For the fourth construct, a discussion of available literature is presented and a construct definition is proposed.

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ESD-WP-2008-15 Taming the Business Cycles in Commercial Aviation: Trade-space analysis of strategic alternatives using simulation modeling

by Sgouris Sgouridis
Assistant Professor, Engineering Systems and Management, Masdar Institute of Science and Technology

Joseph Sussman
Professor of Civil and Environmental Engineering and Engineering Systems, MIT

Henry Weil
Senior Lecturer, Sloan School of Management

Kirkor Bozdogan
Principal Research Associate, Center for Technology, Policy and Industrial Devel

We investigate the effectiveness of strategic alternatives that are designed to dampen the cyclicality manifest in the commercial aviation related industries. The constituent enterprises of the commercial aviation system exhibit managerial and operational independence and have diverse value functions that often viewed the enterprises to view their competition as a zero-sum game. We argue that this need not always be the case; in the commercial aviation system both airline and airframe manufacturers constituents would benefit from a steadier influx of aircraft that counters the current situation that is characterized by relatively stable demand growth rate for air travel while airline profitability and aircraft ordering fluctuate intensely. In order to identify and evaluate the symbiotic potential, we use a system dynamics model of commercial aviation. After testing several individual strategic alternatives, we find that capacity management is key to cycle moderation for non-collusive strategies. Comparing faster aircraft deliveries to semi-fixed production schedules among other alternatives shows only the latter alternative to be Pareto efficient.

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ESD-WP-2008-14 A Comparison of GDP-Based Productivity in Ambulatory & Inpatient Healthcare: 1998-2005

by David Hartzband
Engineering Systems Division
Massachusetts Institute of Technology

A comparison of GDP-based productivity in the ambulatory and inpatient (hospitals and residential treatment centers) healthcare segments shows that labor productivity, measured as GDP dollar contribution per compensation dollars, hours worked and full-time equivalent employees was strong in both actual value and in per cent gain (1998-2005). The actual values were higher in ambulatory with GDP contribution per hours worked ranging from $0.04-$0.06 (24% gain), per dollar of compensation ranging from $1.41 to $1.48 (4% gain) and per FTE from $71,000 to $94,000 (25% gain) as opposed to $0.02 to $0.03 (3% gain), $1.10 to $1.13 (3% gain) and $38,000 to $52,000 (42% gain) for inpatient healthcare. In contrast, capital efficiency was static for both segments over this period indicating that the use of capital was ineffective. Total Factor Productivity (TFP) was also calculated and showed a similar pattern with ambulatory healthcare having higher TFP throughout the period, but neither healthcare segment showing any gain (or loss) in TFP. The two segments have different profiles for the factors influencing TFP with inpatient healthcare having made both some R&D and substantial technology investments, mainly in medical devices. Neither segment has made large organizational or work process changes, and it appears that substantial, additional productivity gains could be made as these factors, R&D investment, technology acquisition and adoption, work process and organizational redesign, are emphasized.

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ESD-WP-2008-13 Planning for a Flu Pandemic: Policies to Empower Individuals and Families

by Shiva Prakash,
Center for Engineering Systems Fundamentals
Engineering Systems Division
Massachusetts Institute of Technology

Stan Finkelstein M.D.,
Engineering Systems Division
Harvard-MIT Division of Health Sciences & Technology
Massachusetts Institute of Technology

Richard Larson, Ph.D.,
Center for Engineering Systems Fundamentals
Engineering Systems Division
Massachusetts Institute of Technology

No one can predict how much sickness and loss of life will result if and when the next influenza pandemic occurs. Experts agree, the issue is not if it will occur, but when. Whatever that time is, such pandemic flu would likely overwhelm the capacities of our hospitals, clinics and emergency services. Most people ill with the flu will have to be cared for at home by family members and other trusted caregivers.

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ESD-WP-2008-12 Growing Towards a Sustainable Biofuel Future: A Comprehensive Policy Strategy for Navigating Tradeoffs
and Stakeholder Interests in U.S. Agriculture
Final Report – ESD.10 Introduction to Technology and Policy

by Pearl Donohoo, MIT, Technology and Policy Program
Don MacKenzie, MIT, Technology and Policy Program
Jeff McAulay, MIT, Technology and Policy Program
Julio Pertuzé, MIT, Technology and Policy Program
Addison Stark, MIT, Technology and Policy Program

Rapid growth of biofuels production in the United States is reshaping the agricultural industry, delivering both benefits and conflict among stakeholders. Routes forward on biofuels production should be viewed in the context of economic, land use, environmental, and energy security tradeoffs and their potential impacts in the future. This report discusses the current, emerging, and prospective conflicts arising from increased biofuels production, recommends policies to resolve these conflicts, and identifies likely areas of support and opposition from stakeholder groups. The report focuses heavily on ethanol, because ethanol accounts for 95 percent of U.S. biofuels production (Worldwatch 2006); however, many of the trade-offs and recommendations identified in the report can and should be applied to biofuels more generally.

This report does not attempt to assess whether or not biofuels are the best option for transportation fuel use. Rather, it accepts that current mandates, policies, and market conditions will result in increased biofuel production and proposes policies to support growth in more economically and environmentally sustainable manners.

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ESD-WP-2008-11 GDP-Based Productivity in Ambulatory Healthcare: A Comparison with other Industry Segments, 1998-2005

by David Hartzband
Engineering Systems Division
Massachusetts Institute of Technology

Few studies have focused on productivity in healthcare, let alone in ambulatory healthcare. Measurement of productivity in various healthcare segments has generally shown that productivity has either decreased (over some time period) or has increased more slowly than in other industry segments. This study shows that labor productivity has increased in ambulatory healthcare between 1998 and 2005 (by ~24%), but that capital efficiency has not changed over that time period. The study compared this result with the same measurements in the auto and information industry segments (as defined by the Bureau of Economic Analysis) and found that labor productivity gains were highest in the information industry (34%) and lowest in auto (6%), and that capital efficiency increased 8% in the information industry but decreased 7% in auto.

The study also found a strong linkage between changes in gross domestic product components for value-added and gross output and both labor and capital inputs in ambulatory healthcare. This linkage was not found in either of the other two industry segments investigated. This linkage implies that labor and capital input account for close to all of the productivity gains measured in ambulatory healthcare, but that other factors, such as labor quality, work process and structural reorganization, research and development investment and adoption of new technologies are not affecting this gain in productivity the way they may be in auto and the information industry. This result implies that addressing these factors may increase productivity in ambulatory healthcare even more than has been the case from labor and capital input increases.

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ESD-WP-2008-10 Revisiting R0, the Basic Reproductive Number for Pandemic Influenza

by Richard C. Larson
Center for Engineering Systems Fundamentals
Engineering Systems Division
Massachusetts Institute of Technology

This paper focuses on a fundamental input parameter for most existing mathematical models of pandemic influenza, the ‘basic reproductive number R0,’ defined to be the mean number of new influenza infections created by a newly infected person in a population of all susceptible people. We argue that R0 is limited in policy and scientific value as is any single parameter attempting to characterize a complex probabilistic process. In particular, we demonstrate by simple logic that R0 does not exist as a separate ‘constant of a particular influenza,’ but rather its value is determined by social context and behavioral patterns as well as by the “physics’’ of the influenza virus. To the extent that R0 is useful, it is best viewed as an output of a modeling analysis, not an input. But with R0 being the mean of a random variable, much more information is contained in the entire probability distribution. With this view, we show – again by simple arguments – that R0 can be greater than 1.0 and still, contrary to popular belief, the probability of an exponentially growing pandemic may be arbitrarily small. Finally, we show that attempts to estimate R0 from data of previous pandemics is fraught with methodological complexities, due primarily to heterogeneities in the population that cause super-spreaders and socially active people to be the first propagators of the disease. Unless one is careful, statistical estimates of R0 based on early exponential growth of reported cases may be significantly upwardly biased.

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ESD-WP-2008-09 Auto ID Paradigm Shifts from Internet of Things to Unique Identification of Individual Decisions in System of Systems

by Shoumen Palit Austin Datta,
Massachusetts Institute of Technology

Return on investment (ROI) from radio frequency (RF) based tools of identification may increase with the diffusion of frequency agnostic modes of radio frequency identification (RFID), such as, ultrawideband (UWB). Similarly, fixed frequency readers may be replaced with interrogators that can operate in any frequency, such as software defined radio (SDR). However, mere identification of objects provides data that may not be useful unless the process of data acquisition is further linked to systems where the data can be analysed and useful information extracted. This evolution remains incomplete because data about objects is only a small segment of necessary information. Global businesses and systems, such as healthcare, demand much more than object data. Often processes and plans as well as prior decisions are taken into account when deciding on a future course of action or may be the next step in a transaction. Current practice of auto id, although useful in some instances, remains only a small part of what is necessary for identification of information in complex system of systems. Identification, therefore, must encompass the ability both tangible and intangible elements that contribute to decisions. The unique “address” must be preserved during information exchange and decision support between system of systems.

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ESD-WP-2008-08 Design and Management of Flexible Transportation Networks Through the use of Intelligent Transportation Systems (ITS)

by Joshua McConnell,
McKinsey & Co., Sydney Australia

Joseph Sussman,
Massachusetts Institute of Technology

Designing a flexible system with real options is a method for managing uncertainty. In this research, Intelligent Transportation System (ITS) capabilities were used to create a flexible transportation system, capable of coping with multiple uncertainties. Specifically, HOT, BRT and TOT managed lanes were examined in a case study centered in Houston, Tx, to determine the benefits of flexibility these capabilities provide. A qualitative analysis procedure utilizing regional traffic demand modeling and real options analysis was utilized to assess these benefits. It was found that ITS managed lanes can be configured in multiple ways to create flexibility in transportation systems, each of which provides value when dealing with uncertainty.

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ESD-WP-2008-07 A Portfolio Approach for Purchasing Systems: Impact of Switching Point

by Olli-Pekka Hilmola,
Lappeenranta University of Technology

Hongze Ma,
Accenture (Finland)

Shoumen Palit Austin Datta,
Massachusetts Institute of Technology

In operations management different ordering policies, such as, economic order quantity, lot for lot and periodic ordering, are used in various combinations without deeper considerations for the likely consequences on cash flow and profitability. The success of these techniques is analyzed through inventory levels and/or total cost. In this paper, we present results of simulation which uses three different product groups with varying demand characteristics, changing product margins and also considers product quality failures (due to ordering, engineering change or customer requests). Based on our results, we suggest a portfolio approach where lot for lot policy may be useful in an early phase of the product life-cycle and later it may be an advantage to change over to economic order quantity (EOQ) based ordering. However, demand sustainability and failure rates create instances where orders in larger economical lots may reduce profitability. Therefore, manufacturing may benefit from a portfolio of different purchase order policies and may evaluate the successful balance of policies using cash flow as a parameter. Accuracy of demand forecasting is vital to switching point estimation. Further research on real-world applications of advanced forecasting tools is advocated as well as a framework to develop the portfolio for intelligent purchasing systems.

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ESD-WP-2008-06 Understanding Complexity: Dynamic Analysis of Combat Vehicle Accidents

by Maj. Nathan A. Minami,
Instructor/Analyst; United States Military Academy; Department of Systems Engineering

Stuart E. Madnick,
John Norris Maguire Professor of Information Technologies & Professor of Engineering Systems; Massachusetts Institute of Technology, Sloan School of Management & School of Engineering

Dozens of U.S. soldiers are killed each year as a result of both combat and motor vehicle accidents. The objective of this study is to look beyond the events and symptoms of accidents which normally indicate human error, and instead study the complex and poorly understood upper-level organizational processes and problems that may constitute the actual root causes of accidents – this is particularly challenging because the causes often involve nonlinear dynamic phenomena and have behaviors that are counter-intuitive to normal human thinking, these are often called “wicked” problems. After reviewing the available literature, a System Dynamics model was created to provide an analytical model of this multifaceted system that allows for extensive simulation. The results of these simulations suggest that high-level decisions that balance mission rate and operations tempo with troop availability, careful management of the work-rest cycle for deployed troops, and improvement of the processes for evaluating the lessons learned from accidents, will lead to a reduction in Army combat and motor vehicle accidents.

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ESD-WP-2008-05 Evaluating and Aggregating Data Believability across Quality Sub-Dimensions and Data Lineage

by Nicolas Pratt,
ESSEC Business School

Stuart E. Madnick,
Sloan School of Management and Engineering Systems Division, MIT

Data quality is crucial for operational efficiency and sound decision making. This paper focuses on believability, a major aspect of data quality. The issue of believability is particularly relevant in the context of Web 2.0, where mashups facilitate the combination of data from different sources. Our approach for assessing data believability is based on provenance and lineage, i.e. the origin and subsequent processing history of data. We present the main concepts of our model for representing and storing data provenance, and an ontology of the sub-dimensions of data believability. We then use aggregation operators to compute believability across the sub-dimensions of data believability and the provenance of data. We illustrate our approach with a scenario based on Internet data. Our contribution lies in three main design artifacts (1) the provenance model (2) the ontology of believability subdimensions and (3) the method for computing and aggregating data believability. To our knowledge, this is the first work to operationalize provenance-based assessment of data believability.

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ESD-WP-2008-04 Measuring Data Believability: A Provenance Approach

by Nicolas Pratt,
ESSEC Business School

Stuart E. Madnick,
Sloan School of Management and Engineering Systems Division, MIT

Data quality is crucial for operational efficiency and sound decision making. This paper focuses on believability, a major aspect of quality, measured along three dimensions: trustworthiness, reasonableness, and temporality. We ground our approach on provenance, i.e. the origin and subsequent processing history of data. We present our provenance model and our approach for computing believability based on provenance metadata. The approach is structured into three increasingly complex building blocks: (1) definition of metrics for assessing the believability of data sources, (2) definition of metrics for assessing the believability of data resulting from one process run and (3) assessment of believability based on all the sources and processing history of data. We illustrate our approach with a scenario based on Internet data. To our knowledge, this is the first work to develop a precise approach to measuring data believability and making explicit use of provenance-based measurements.

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ESD-WP-2008-03 Enabling Global Price Comparison with Semantic Integration of Web Data

by Hongwei Zhu,
College of Business and Public Administration, Old Dominion University

Stuart E. Madnick*,
Sloan School of Management and Engineering Systems Division, MIT

Michael Siegel,
Sloan School of Management, MIT

“Sell Globally” and “Shop Globally” have been seen as a potential benefit of web-enabled electronic business. One important step toward realizing this benefit is to know how things are selling in various parts of the world. A global price comparison service would address this need. But there have not been many such services. In this paper, we use a case study of global price dispersion to illustrate the need and the value of a global price comparison service. Then we identify and discuss several technology challenges, including semantic heterogeneity, in providing a global price comparison service. We propose a mediation architecture to address the semantic heterogeneity problem, and demonstrate the feasibility of the proposed architecture by implementing a prototype that enables global price comparison using data from web sources in several countries.

*Corresponding author

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ESD-WP-2008-02 Semantic Integration Approach to Efficient Business Data Supply Chain: Integration Approach to Interoperable XBRL

by Hongwei Zhu,
College of Business and Public Administration, Old Dominion University

Stuart E. Madnick,
Sloan School of Management and Engineering Systems Division, MIT

As an open standard for electronic communication of business and financial data, XBRL has the potential of improving the efficiency of the business data supply chain. A number of jurisdictions have developed different XBRL taxonomies as their data standards. Semantic heterogeneity exists in these taxonomies, the corresponding instances, and the internal systems that store the original data. Consequently, there are still substantial difficulties in creating and using XBRL instances that involve multiple taxonomies. To fully realize the potential benefits of XBRL, we have to develop technologies to reconcile semantic heterogeneity and enable interoperability of various parts of the supply chain. In this paper, we analyze the XBRL standard and use examples of different taxonomies to illustrate the interoperability challenge. We also propose a technical solution that incorporates schema matching and context mediation techniques to improve the efficiency of the production and consumption of XBRL data.

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ESD-WP-2008-01 Lean Aerospace Engineering

by Earll M. Murman
Ford Professor of Engineering Emeritus
Aeronautics and Astronautics Department and Engineering Systems
Massachusetts Institute of Technology

A framework for Lean Engineering is presented, based upon observational findings from a decade of research in the aerospace domain, published works on Toyota and Southwest Airlines, and practitioner input. The framework is illustrated with examples drawn from aircraft and other aerospace applications. Lean Engineering is not totally new to aerospace, and it continues to evolve. Future challenges are briefly summarized.

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