Optimal digital product maintenance with a continuous revenue stream

James Fan; Christopher Griffin

doi:10.1016/j.orl.2017.04.006

Optimal digital product maintenance with a continuous revenue stream

James Fan, Christopher Griffin

Applied Research Laboratory (ARL)

Research output: Contribution to journal › Article › peer-review

5 Scopus citations

Abstract

We use a control framework to analyze the profit maximization problem of digital vendors that capture market share by focusing effort on post-launch product maintenance effort. Effort influences user perception of the product and drives the revenue stream via user adoption. We show necessary and sufficient conditions for optimality, and that perceived quality declines over a product's life cycle. This corresponds with Lehman's 7th law of software evolution. Last, we illustrate control paths under possible market conditions, assuming linearized functions.

Original language	English (US)
Pages (from-to)	282-288
Number of pages	7
Journal	Operations Research Letters
Volume	45
Issue number	3
DOIs	https://doi.org/10.1016/j.orl.2017.04.006
State	Published - May 1 2017

All Science Journal Classification (ASJC) codes

Software
Management Science and Operations Research
Industrial and Manufacturing Engineering
Applied Mathematics

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10.1016/j.orl.2017.04.006

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Optimal digital product maintenance with a continuous revenue stream

Abstract

All Science Journal Classification (ASJC) codes

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