INFORMS Student Chapter Speaker Series with Dr. Priyank Arora
October 19, 2018
10:30 am-12:00 pm
Isenberg School of Management
UMass Amherst Campus
Nonprofit organizations (NPOs) that support and serve distressed individuals face a complex task because their clients are often unable to articulate their needs. As a result, these NPOs are driven to not only offer a variety of services to fulfil different needs, but also engage in advisory activities to minimize mismatches between the services clients receive and their true needs. Motivated by several NPOs, such as Daya and Georgia Works, we study a service design dilemma for resource-constrained NPOs who need to balance advisory and service delivery efforts to maximize their social impact. We model the NPO’s service-design problem that captures this essential trade- off: while increasing advisory efforts increases the likelihood of clients receiving the appropriate services (reduces mismatches), it limits the resources available for different service delivery efforts. We derive optimal advisory and service delivery efforts as a function of the state of the NPO (resources and services) and clients’ characteristics (mix and diversity of needs). We characterize conditions under which an NPO should invest more in its advisory effort as compared to service delivery efforts: when the NPO is not severely resource-constrained, when mismatches lead to high loss of impact, or when service offerings are not scalable. We also identify conditions under which the NPO should specialize on a single service type, i.e., not provide “everything for everyone.” Finally, we analyze the effect oefarmarked funding and other asymmetries between services (in scale or loss of impact due to mismatches).
NPO’s optimal service design. We present an illustration of our analysis in a practical context, and suggest ways that NPOs can implement our findings in designing their services.