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Incorporating Managerial Thinking in Prediction and Control: Case Study of Market Penetration

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  • S. Beifuss

    (University of Southern California)

  • W. Proskurowski

    (University of Southern California)

  • F. E. Udwadia

    (University of Southern California)

Abstract

Managerial strategies, especially at the higher echelons of management, are often linguistically stated. This is because they need to be based on information which often defies quantification. Such verbal strategies and qualitative information have often been found to be difficult to incorporate in quantitative models. Thus, the quantitative effects of implementing one strategy as opposed to another have generally been difficult to forecast. In this paper, we show that, through the use of fuzzy logic, we can incorporate such qualitative (linguistically stated) information. Furthermore, we show that a fuzzy controller can be designed so as to reach desired goals while being cognizant of linguistically stated strategies, scenarios, and decision rules as well as quantitative data types. The approach is applied to the modeling and control of market penetration, a field which has attracted considerable attention in recent years.

Suggested Citation

  • S. Beifuss & W. Proskurowski & F. E. Udwadia, 1997. "Incorporating Managerial Thinking in Prediction and Control: Case Study of Market Penetration," Journal of Optimization Theory and Applications, Springer, vol. 92(2), pages 225-248, February.
    • Handle: RePEc:spr:joptap:v:92:y:1997:i:2:d:10.1023_a:1022611027877
    DOI: 10.1023/A:1022611027877
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    References listed on IDEAS

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    1. Dan Horsky & Leonard S. Simon, 1983. "Advertising and the Diffusion of New Products," Marketing Science, INFORMS, vol. 2(1), pages 1-17.
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    3. Hermann Simon & Karl-Heinz Sebastian, 1987. "Diffusion and Advertising: The German Telephone Campaign," Management Science, INFORMS, vol. 33(4), pages 451-466, April.
    4. Frank M. Bass, 1969. "A New Product Growth for Model Consumer Durables," Management Science, INFORMS, vol. 15(5), pages 215-227, January.
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