how so? I guess if u pushed them far enough. I guess what I'm referring to is the MOST binding constraint
-
-
Replying to @fortelabs
Right - you're talking about the constraints with the highest duals, in optimization terms.
2 replies 0 retweets 0 likes -
Replying to @davidmanheim
hmm I don't know optimization. TOC claims optimization has very marginal utility for most throughout problems
1 reply 0 retweets 0 likes -
Replying to @fortelabs
"TOC"? I assume it's b/c optimization is hard to do without an algebraic model - so OR for systems uses simulation models heavily
4 replies 0 retweets 0 likes -
Replying to @davidmanheim @fortelabs
but the same conceptual idea of dual / shadow price applies; there is a gain of X units for relaxing constraint C by one unit.
1 reply 0 retweets 1 like -
Replying to @davidmanheim @fortelabs
If it's a typical optimization problem X is the coefficient of the dual for constraint C Phrased better: http://www.bayt.com/en/specialties/q/49614/what-is-shadow-price-is-it-the-same-as-dual-price/ …
3 replies 0 retweets 1 like -
Replying to @davidmanheim
but more fundamentally, he attacks the very concept of per-unit cost accounting. Leads to many wrong incentives
2 replies 0 retweets 1 like -
Replying to @fortelabs
I agree that it can screw up incentives, but attributing costs on per-unit basis can also confuse costs due to business decisions
1 reply 0 retweets 1 like -
Replying to @davidmanheim
.
@fortelabs Metrics must align with decisions; I'd agree that sometimes shadow prices are a bad tool for deciding which constraint to change1 reply 0 retweets 0 likes -
Replying to @davidmanheim @fortelabs
Maybe my next
@ribbonfarm post should be on aligning metrics and decisions. But only if I can figure out what to say about it. ;)2 replies 0 retweets 2 likes
Say "ALIGN THEM OR DIE!"
Loading seems to be taking a while.
Twitter may be over capacity or experiencing a momentary hiccup. Try again or visit Twitter Status for more information.