We consider a firm consisting of two divisions, one responsible for designing and manufacturing new products and the other responsible for remanufacturing operations. The firm will sell these new and remanufactured products either directly to the consumer (direct selling) or through an independent retailer (indirect selling). Our study demonstrates that a firm’s organizational structure can affect its marketing decisions. Specifically, a decentralized firm with separate manufacturing and remanufacturing divisions can benefit from indirect selling with higher firm profit, supply chain profit, and total consumer demand than direct selling. Moreover, this structure also induces a remanufacturable product design. In contrast, a centralized firm in which the manufacturing and remanufacturing divisions are consolidated is intuitively better off by choosing direct selling than indirect selling. Furthermore, we show that, surprisingly, when the focal firm sells through an independent retailer, a decentralized internal structure can result in higher supply chain profit than a centralized internal structure. We further investigate the case of dual dedicated channels and conclude that, while direct selling of remanufactured products and indirect selling of new products can better induce a remanufacturable product design and higher supply chain profit, it is not in the best interest of the firm in terms of total sales and firm profit.
Academic & Professional Qualification
Ph.D. in Business Administration, with specialization of Operations and Management Science
Zhixi Wan is professor in the area of Innovation and Information Management. His expertise includes supply chain management, value chain strategies, and marketplace economics and operations. His research on these topics has been published in top-tier research journals including Management Science, Operations Research, Manufacturing and Service Operations Management, Strategic Management Journal, and Production & Operations Management.
He received his Ph.D. in Operations and Management Science from the Ross School of Business at the University of Michigan, Ann Arbor. Before joining the University of Hong Kong, he was a tenured associate professor at the University of Oregon, and an assistant professor at HEC Paris and an assistant professor at the University of Illinois, Urbana-Champaign. He was on an academic leave and worked in Didichuxing, a leading ride-hailing platform firm, as DiDi Economist and the head of the company’s research center of Innovation and Operations Management.
Professor Wan obtained his Bachelor of Engineering degree from the Tsinghua University, and studied in the area of Automation Engineering (1999-2003).
- Supply Chain and Logistics Management
- Geospatial Data & Business Analytics
- Supply and Value Chain Management
- Platform Economics and Operations
- Sourcing and Procurement Strategies in Supply Chains
- Auctions and Mechanism Design
- Behavioral Operations and Experimental Studies
- Tianqin Shi, Dilip Chhajed, Zhixi Wan, and Yunchuan Liu. 2020. Distribution Channel Choice and Divisional Conflict in Remanufacturing Operations, Production and Operations Management, 29 (7), 1702-1719.
- Hao Sun, Hai Wang, and Zhixi Wan. 2019. Model and Analysis of Labor Supply for Ride-Sharing Platforms in the Presence of Sample Self-Selection and Endogeneity, Transportation Research Part B, 125, 76-93
- Guangrui Ma, Michael Lim, Ho-Yin Mak, and Zhixi Wan. 2019. Promoting Clean Technology Adoption: To Subsidize Products or Service Infrastructure? Service Science, 11 (2), 75-95
- Xing Hu, Zhixi Wan, and Nagesh Murthy. 2019. Dynamic Pricing of Limited Inventories with Product Returns, Manufacturing & Service Operations Management, 21(3): 501-518.
- Timophey Shalpegin, Svenja Sommer, and Zhixi Wan. 2017. Collaborative Prototyping of Alternative Designs Under a Target Costing Scheme, Production & Operations Management, 27 (3), 496-515.
- Shanshan Hu, Zhixi Wan, Qing Ye, and Wei Chi. 2017. Supplier Behavior in Capacity Investment Competition: An Experimental Study, Production and Operations Management, 26 (2), 273-291.
- Cuihong Li and Zhixi Wan. 2017. Supplier Competition and Cost Improvement, Management Science, 63 (8), 2460-2477.
- Zhixi Wan and Brian Wu. 2017. When Suppliers Climb the Value Chain: A Theory of Value Distribution in Vertical Relationships, Management Science, 63 (2), 477-496.
Distinguished Paper Award 2015, Business Policy and Strategy division of the Academy of Management
Strategic Management Society 2015 Best Conference Paper Prize Honorable Mention
- Zhixi Wan and Damian Beil. 2014. Bid-taker Power and Supply Base Diversification, Manufacturing & Service Operations Management, 16 (2), 300-314.
M&SOM 2008 Student Paper Competition Finalist
- Brian Wu, Zhixi Wan, and Daniel Levinthal. 2014. Complementary Assets As Pipes and Prisms: Innovation Incentives and Trajectory Choices, Strategic Management Journal, 35 (9), 1257-1278 (lead article).
- Zhixi Wan, Damian Beil, and Elena Katok. 2012. When Does It Pay to Delay Qualification Screening? Theory and Experiments, Management Science, 58 (11), 2057-2075.
- Zhixi Wan and Damian Beil. 2009. RFQ Auctions with Supplier Qualification Screening, Operations Research, 57 (4), 934-949.
Awards and Honours
- Second Prize of the 2018 CSAMSE Annual Conference Best Paper Award
- Distinguished Paper Award 2015, Business Policy and Strategy division of the Academy of Management
- Strategic Management Society 2015 Best Conference Paper Prize Honorable Mention
- CSAMSE Annual Conference Best Paper Honorable Mention (2012)
- M&SOM Student Paper Competition Finalist (2008)