Research On Cooperation And Competition Between Heterogeneous Service Providers

With the highly mature of the production-oriented economy and the rapid development of information technology, global industrial structure significantly exhibits a trend that accelerate the transition to a postindustrial service economy, which has become a typical feature of global economy in the21st century. The service industry become one of the most potential areas in modern economy, it can be said that mankind has entered service economic times. Serve is the the interactions between service providers and customers with the goals of co-creativity, value acquisition. With the development of modern information technology and the popularity of the Internet, the characteristics of the modern services include not only intangible, cannot be stored and customer participation, but also distinct networking. Service networks and service provider organization networks are becoming increasingly complex, and the ways for people to obtain services are also becoming increasingly diverse. In modern service industry, the phenomenon that two or more heterogeneous service providers offer the same type of services to customers is very common.Heterogeneous service system is a system where the customers are able to acquire the same type of services from heterogeneous service providers. The experiences and the efficiency of the services may be different, because of the operational strategies and objectives difference among heterogeneous service providers. The customers aslo have different choices and preferences between the service providers. In the heterogeneous service system, several problems of managerial interest are worthy of study. For instance, in the modern hotel industry, there are usually two reservation methods, the traditional off-line room reservation channel and the third-party online reservation channel. The imperative is for the hotel managers to reexamine their reservation channel structure, and focus on how to cooperate with the third-party online travel companies in the aim to attract more customers and, in turn, to maximize the profit. In the modern heterogeneous healthcare service, the public hospitals are required by the government to serve more customers so as to increase the social welfare and the utilization of the sanitation. However, the private hospitals desire to earn more rather than serve more. Therefore, the competition among the public hospitals and the private hospitals arises in serving the customers. In this thesis, the cooperation and the competition between two heterogeneous service providers with different operational strategies and objectives in two heterogeneous markets are studied through the examples of the hotel service industry and the healthcare service industry.The organization of this thesis is as follows:In Chapter1, we first introduce the background of this thesis, and review the researches on service operations management, as well as the literatures about heterogeneous service system. Through analyzing the problem of current research, we propose the content and significance of this thesis. At the end of this chapter, research method and organization structure of this thesis are presented.In Chapter2, by considering the hotel reservation service system as a special queue service system (loss queueing model), the decision problem of setting online-exclusive-rooms (OERs) for a hotel when cooperates with a third-party website is investigated. Through the marginal analysis method, the optimal OERs quantity strategy is analyzed. The performance of the optimal strategy is compared to the room resources sharing form. Factors affecting the optimal strategy and performance are also investigated.In Chapter3, the problem of a hotel on how to cooperate with a third-party website on room booking service by a new form named "setting online-exclusive-rooms" or "setting OERs" is studied. By building and solving a dynamic programming model, we help the hotel make these two decisions:to set an appropriate quantity of OERs and to determine an optimal acceptance policy for the request from the website. To be easier to use, a heuristic acceptance policy is proposed and the performance of this heuristic policy is analyzed by numerical experiment. Based on the optimal acceptance policy, the optimal OERs quantity decision of the hotel with the objective of maximizing the expected revenue is analyzed. The performance of the new setting OERs form is compared to the current widely used "first come first serve"(FCFS) form.In Chapter4, the competition between a public hospital and a private hospital in a heterogeneous healthcare service system with two customer markets:a poor market and a rich market is studied. The public hospital chooses a capacity to maximize its customers’ arrival rate under the government budget, and the private hospital chooses a price and capacity to maximize its net profit. For the convenience of comparison, we firstly investigate the equilibriums for two one-tier healthcare systems, and then show the equilibriums for the heterogeneous healthcare system and characterize the equilibrium competition strategies. We also discuss the market conditions that are more suitable for heterogeneous healthcare system.Chapter5concludes this thesis and gives some feasible directions for further investigation.The main results of this thesis are as follows:(1) Under the heterogeneous room booking system, the expected revenue of the hotel is proved to be a concave function of the quantity of OERs. Analytical and numerical studies show that:the optimal quantity of OERs decreases in the booking price at the front desk of the hotel, and increases in the booking price at the online platform; the optimal OERs decreases in the proportion of booking price as commission; the optimal OERs decreases in the customer arrival rate at the front desk, and increases in the customer arrival rate at the online platform; the optimal OERs decreases in the expected customer stay time. Compared with the room resources sharing form, it is better to set OERs when the online booking price is too low, or the commission part is too high, or both online and offline customer arrival rates are large, or the expected customer stay time is long.(2) When a hotel collaborates with a third-party website on room booking service by the new form "setting OERs", we first show that there is indeed an optimal value or a range of optimal values of the OERs quantity, depending on the relationship between the hotel’s unit revenues from selling an OER and from selling a requested room to an online customer. Second, we investigate the optimal acceptance policy for the hotel when all OERs are sold out, which is found to be a one-dimensional threshold policy. We further propose a heuristic policy, which is shown to have close performance to the optimal one, but much easier to implement. Third, we find that under the proposed setting OERs form, the hotel can always achieve larger or equal expected revenue than that under the current widely used FCFS form, which implies that hotel managers should consider this new form in cooperating with third-party websites.(3) In the one-tier healthcare system of public hospital monopoly, poor customers will first get service with the government budget increases; All the poor and rich customers can be served under the monopoly of private hospital. We find that as the budget increases, four different equilibriums sequentially exist for the competition strategies of the public hospital and the private hospital. Under the duopoly, our results demonstrate that all customers are willing to join the heterogeneous healthcare system, but the two types of customers would not simultaneously go to the two hospitals in equilibrium state. We also find that the duopoly competition can result in lower price in the private hospital than in the monopoly. When the capacity cost for the hospitals is medium then the market favors the heterogeneous healthcare system. Too small capacity cost results in the monopoly of the public hospital.Innovations and contributions of this thesis are briefly summarized as follows:(1) Analyze the new characteristics of modern service industry, systematically investigate the cooperation and competition problems of hospitality service and healthcare service in the heterogeneous service system.(2) In the heterogeneous room booking service system, quantitatively investigate the operational decisions of a hotel when it introduces a third-party tourism website as an online channel for its room booking. A new cooperating form for the hotel to collaborate with a third-party website is proposed, which will be shown to be more profitable for the hotel than the current widely used "FCFS" form. Theoretically, this research enriches the existing revenue management literature, and finds a new way of improving profit for hotels in the e-commerce age.(3) The competition problems between two heterogeneous service providers in a heterogeneous service system with two heterogeneous customer markets are firstly studied in this thesis. The two types of customers (poor and rich) have different sensitivities over service price and delay. The two service providers have different operational strategies and objectives:the public hospital chooses a service capacity to maximize its customers’arrival rate, and the private hospital chooses price and capacity to maximize its net profit.(4) Characterize the optimal strategies of the models proposed in this thesis and the exact conditions applicable to each of the optimal strategies, and analyze the influence of various parameters on the decision-making. These results can provide a theoretical basis for service firms to develop new operational strategies in the information age, which also can give some insights for government policy making.