Karen Donohue

Karen Donohue

Professor and Curtis L. Carlson Endowed Chair in Supply Chain Operations
Supply Chain and Operations


  • BA
    Mathematics and Economics, St. Olaf College
  • MS
    Industrial Engineering and Management Science, Northwestern University
  • PhD
    Industrial Engineering, Northwestern University


  • Supply Chain Coordination
  • Behavioral Operations
  • Environmental Operations


Karen Donohue's research examines methods for coordinating inventory and distribution decisions across supply chains. She draws on a number of different methodologies in her research including stochastic modeling, game theory, and behavioral economics.

Her analytical work focuses on identifying and measuring the impact of different contractual schemes between supply chain partners and competitors.  Examples include using tiered pricing and buyback contracts to coordinate production decisions and using service-based competition schemes to incentivize suppliers to invest in higher service quality.  This research is normative in the sense that it prescribes how supply chain partners should behave, under a given set of rules, in order to maximize expected profit.  Her most recent normative research focuses on analyzing contracting schemes that a buyer can use to induce his suppliers to invest in service quality when these suppliers vary in their capacity levels and cost structures.  This research establishes a scoring rule for the buyer that can be used to incentivize custom service level targets for each supplier while maximizing profit for the buyer.

Karen's behavioral work takes a more descriptive approach by examining behavioral factors that may influence how humans make decisions in supply chain settings.  One factor she has uncovered is the notion of "coordination risk," which causes inventory managers to build up inventory even when it increases supply chain cost and order instability.  Another factor she has studied is loss aversion and its impact on contract preferences.  Her research sheds light on interactions between buyers and suppliers in competitive and cooperative settings.

Karen received B.A. degrees in Mathematics and Economics from St. Olaf College, and a M.S. and PhD. in Industrial Engineering and Management Science from Northwestern University.  Before joining the Carlson School, she served for six years on the faculty of the Wharton School at the University of Pennsylvania.  Her articles have appeared in such journals as Management Science, Operations Research, Interfaces, Production and Operations Management, and Journal of Operations Management.  She currently serves as an Associate Editor for Management Science and POMS.  Her early research was funded through an NSF Career Award.

Selected Works & Activities

  • Journal Articles
    "Online Business-to-Business Markets for Industrial Product Reuse: Evidence from an Operational Policy Change", S. Dhanorkar, K. Donohue, and K. Linderman, (2020), to appear in Manufacturing & Service Operations Management.
  • Journal Articles
    "Behavioral Operations: Past, Present, and Future", K. Donohue, O. Ozer, and Y. Zhang, (2020), Manufacturing & Service Operations Management, 22 (1) 191-202.
  • Journal Articles
    “Closing a Supplier's Energy Efficiency Gap through Assessment Assistance and Procurement Commitment", Nguyen, Donohue, Mehrotra, Management Science (2019), 65 (1), 122-138.
  • Journal Articles
    "The Decision to Recall: a Behavioral Investigation in the Medical Device Industry", G. Ball, R. Shah, and K. Donohue, (2018), Journal of Operations Management, 62 (9), 1-15.
  • Journal Articles
    "Initiating and Sustaining Supplier Involvement in Development Projects: a Behavioral Investigation", Wuttke, Donohue, and Siemsen, Production and Operations Management (2018), 27 (1), 80-99.
  • Journal Articles
    “Managing and Reallocating Inventory across two Markets with Local Information”, E. Spiliotopoulou, K. Donohue, MÇ Gürbüz, and H.S. Heese, European Journal of Operational Research (2018), 266, 531-542.
  • Journal Articles
    "Contract Preferences and Performance for the Loss Averse Supplier: Buyback versus Revenue Sharing," Zhang, Donohue, and Cui, Management Science (2016), 62 (6) , 1734-1754.
  • Journal Articles
    “Information Reliability in Supply Chains: the Case of Multiple Retailers”, E. Spiliotopoulou, K. Donohue, and MÇ Gürbüz, Production and Operations Management (2016), 25: 548–567.
  • Journal Articles
    "Repurposing Materials and Waste through Online Exchanges: Overcoming the Last Hurdle," Dhanorkar, Donohue, and Linderman, Production and Operations Management (2015), 24: 1473-1493.
  • Journal Articles
    "Order Stability in Supply Chains: Coordination Risk and the Role of Coordination Stock," Croson, Donohue, Katok, Production and Operations Management (2014), 23: 176-196
  • Associate Editor, Manufacturing & Service Operations Management (M&SOM)

  • Supply chain coordination

  • Reducing environmental impact of supply chains

  • Wickham Skinner Award for Best POM Paper Published in 2016, Carlson School Faculty Research Award (2017, 2012); Carlson School Faculty Service Award (2012, 2006); INFORMS Behavioral Process Management Service Award (2008); INFORMS Behavioral Process Management Most Influential Paper Award (2007); Operations Research Meritorious Service Award, (2004, 1999, 1998); National Science Foundation Career Award (1996-2002).

  • Behavioral issues in supply chain management

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