Seminar (Dept. of Management Science and Engineering)

Title: Optimizing Real-Time Matching and Routing Decisions in Online Food Delivery Platforms

Speaker: Yanlu Zhao (Durham University, Associate Professor)

Time: 10:00 (Thursday), December 26th, 2024

Venue: Room 1007, Mingde Business Building

Language: Chinese/English

ABSTRACT:

Online food delivery (OFD) platforms have grown rapidly, driven by shifts in consumer behavior during the COVID-19 pandemic. These platforms rely on two critical operational decisions: driver-order matching and routing. This seminar focuses on optimizing these decisions to enhance efficiency and service quality. For driver-order matching, we develop real-time algorithms that account for uncertain food processing times. By strategically delaying driver assignments, the proposed k-level thickening policy increases marketplace availability, balancing idle driver costs with late delivery penalties. Using machine learning to predict processing times, we demonstrate that the optimal matching policy for single orders follows a threshold structure, which generalizes to multiple orders under driving time constraints. For driver routing, we address challenges from the uncertain participation of mixed fleets (in-house and crowdsourced drivers). We model the problem as a Markov Decision Process (MDP) and propose four integrated approaches for scheduling and routing. Additionally, we provide a continuous approximation formula to estimate fleet size requirements for in-house drivers. Numerical experiments using real datasets highlight the effectiveness of our solutions, achieving significant cost reductions and offering actionable insights for real-time OFD operations.

SHORT BIOGRAPHY:

Yanlu Zhao is an associate professor in Operations Management at Durham University Business School. His research and teaching focus on data-driven service operations and supply chain management. He has published in several academic journals such as EJOR, POM, IISE, TS, IJOC, MSOM, OMEGA, and regularly presents his research at international conferences in Europe, Asia, and the United States. He received his doctoral degree from ESSEC Business School in France. In 2019, he visited the Institute of Operations Research and Analytics (IORA) at National University of Singapore.  In 2024, he was on research leave and visited the Department of Logistics and Maritime Studies in Hong Kong Polytechnic University. Currently, he is an associate editor of the Networks journal.