Comparing Utility-based and Network-based Approaches in Modeling Customer Preferences for Engineering Design

Sha, Zhenghui; Bi, Youyi; Wang, Mingxian; Stathopoulos, Amanda; Contractor, Noshir; Fu, Yan; Chen, Wei

doi:10.1017/dsi.2019.390

Cited by 3 publications

(1 citation statement)

References 27 publications

(32 reference statements)

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“…The database also records the stated consideration of vehicle models, in addition to the recorded final purchase. A more detailed summary of this dataset can be found in our previous paper (Sha et al 2019). In line with our previous work, we narrow down the analysis to a single type of vehicle model.…”

Section: Case Studymentioning

confidence: 99%

A network-based discrete choice model for decision-based design

Sha

Cui²,

Xiao³

et al. 2023

Des. Sci.

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Customer preference modelling has been widely used to aid engineering design decisions on the selection and configuration of design attributes. Recently, network analysis approaches, such as the exponential random graph model (ERGM), have been increasingly used in this field. While the ERGM-based approach has the new capability of modelling the effects of interactions and interdependencies (e.g., social relationships among customers) on customers’ decisions via network structures (e.g., using triangles to model peer influence), existing research can only model customers’ consideration decisions, and it cannot predict individual customer’s choices, as what the traditional utility-based discrete choice models (DCMs) do. However, the ability to make choice predictions is essential to predicting market demand, which forms the basis of decision-based design (DBD). This paper fills this gap by developing a novel ERGM-based approach for choice prediction. This is the first time that a network-based model can explicitly compute the probability of an alternative being chosen from a choice set. Using a large-scale customer-revealed choice database, this research studies the customer preferences estimated from the ERGM-based choice models with and without network structures and evaluates their predictive performance of market demand, benchmarking the multinomial logit (MNL) model, a traditional DCM. The results show that the proposed ERGM-based choice modelling achieves higher accuracy in predicting both individual choice behaviours and market share ranking than the MNL model, which is mathematically equivalent to ERGM when no network structures are included. The insights obtained from this study further extend the DBD framework by allowing explicit modelling of interactions among entities (i.e., customers and products) using network representations.

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Section: Case Studymentioning

confidence: 99%

A network-based discrete choice model for decision-based design

Sha

Cui²,

Xiao³

et al. 2023

Des. Sci.

View full text Add to dashboard Cite

show abstract

Network-Based Analysis of Heterogeneous Consideration-Then-Choice Customer Preferences with Market Segmentations

Cui,

Xiao,

Sha

et al. 2024

Conference on Systems Engineering Research Series

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Robust design of complex socio-technical systems against seasonal effects: a network motif-based approach

Xiao

Sha

2022

Des. Sci.

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Seasonal effects can significantly impact the robustness of socio-technical systems (STS) to demand fluctuations. There is an increasing need to develop novel design approaches that can support capacity planning decisions for enhancing the robustness of STS against seasonal effects. This paper proposes a new network motif-based approach to supporting capacity planning in STS for an improved seasonal robustness. Network motifs are underlying nonrandom subgraphs within a complex network. In this approach, we introduce three motif-based metrics for system performance evaluation and capacity planning decision-making. The first one is the imbalance score of a motif (e.g., a local service network), the second one is the measurement of a motif’s seasonal robustness, and the third one is a capacity planning decision criterion. Based on these three metrics, we validate that the sensitivity of STS performance against seasonal effects is highly correlated with the imbalanced capacity between service nodes in an STS. Correspondingly, we formulate a design optimisation problem to improve the robustness of STS by rebalancing the resources at critical service nodes. To demonstrate the utility of the approach, a case study on Divvy bike-sharing system in Chicago is conducted. With a focus on the size-3 motifs (a subgraph consisting three docked stations), we find that there is a significant correlation between the difference of the number of docks among the stations in a motif and the return/rental performance of such a motif against seasonal changes. Guided by this finding, our design approach can successfully balance out the number of docks between those stations that have caused the most severe seasonal perturbations. The results also imply that the network motifs can be an effective local structural representation in support of STS robust design. Our approach can be generally applied in other STS where the system performances are significantly impacted by seasonal changes, for example, supply chain networks, transportation systems and power grids.

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Comparing Utility-based and Network-based Approaches in Modeling Customer Preferences for Engineering Design

Cited by 3 publications

References 27 publications

A network-based discrete choice model for decision-based design

A network-based discrete choice model for decision-based design

Network-Based Analysis of Heterogeneous Consideration-Then-Choice Customer Preferences with Market Segmentations

Robust design of complex socio-technical systems against seasonal effects: a network motif-based approach

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