Diffusion of Innovations Under Supply Constraints

Sunil Kumar, Jayashankar M. Swaminathan · 2003 · Operations Research

Summary. This paper develops a model for firms selling innovative products under production capacity constraints. The authors modify the Bass diffusion model to account for unmet demand affecting future sales. They show that immediately selling maximum output is suboptimal, and instead recommend a "build-up" strategy where firms delay sales to accumulate inventory, ensuring no lost sales once market entry begins. The analysis provides optimal timing and inventory levels for product rollout.

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Kumar, S., & Swaminathan, J. M.. (2003). Diffusion of Innovations Under Supply Constraints. Operations Research. https://doi.org/10.1287/opre.51.6.866.24918

@article{kumar-2003-diffusion-innovations-under-supply-constraints,
  title   = {Diffusion of Innovations Under Supply Constraints},
  author  = {Sunil Kumar and Jayashankar M. Swaminathan},
  journal = {Operations Research},
  year    = {2003},
  doi     = {10.1287/opre.51.6.866.24918},
  url     = {https://doi.org/10.1287/opre.51.6.866.24918}
}

TY  - JOUR
TI  - Diffusion of Innovations Under Supply Constraints
AU  - Sunil Kumar
AU  - Jayashankar M. Swaminathan
JO  - Operations Research
PY  - 2003
DO  - 10.1287/opre.51.6.866.24918
UR  - https://doi.org/10.1287/opre.51.6.866.24918
ER  -

Details

DOI: 10.1287/opre.51.6.866.24918
Countries: United States
Regions: North America
Categories: innovation-theory, general-innovation
Added: 2026-04-28