Consider a series of companies in supply chain, each whom orders from its immediate upstream member. In this setting, inbound downstream member serve as valuable informational input to production and inventory decisions. This paper claims that the information transferred form “orders” tends be distorted can misguide members their particular, variance may larger than sales, distortion increase one moves upstream—a phenomenon termed “bullwhip effect.” analyzes four sources bullwhip effect:...

The adoption of information technology (IT) in organizations has been growing at a rapid pace. use the evolved from automation structured processes to systems that are truly revolutionary they introduce change into fundamental business procedures. Indeed, it is believed “More than being helped by computers, companies will live them, shaping strategy and structure fit new [25].” While importance relationship between organizational evidenced considerable literature on subject, 1 there lack...

Advances in information system technology have had a huge impact on the evolution of supply chain management. As result such technological advances, partners can now work tight coordination to optimise chain-wide performance, and realised return may be shared among partners. A basic enabler for is sharing, which has been greatly facilitated by advances technology. This paper describes types inventory, sales, demand forecast, order status, production schedule. We discuss how why this using...

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Consider a system that is modeled as an M/M/1 queueing with multiple user classes. Each class characterized by its delay cost per unit of time, expected service time and demand function. This paper derives pricing mechanism which optimal incentive-compatible in the sense arrival rates execution priorities jointly maximize net value while being determined, on decentralized basis, individual users. A closed-form expression for resulting price structure presented studied.

Consider a supply chain in which product must pass through multiple sites located series before it is finally delivered to outside customers. Incentive problems may arise this system when decisions are delegated corresponding site managers, each maximizing his/her own performance metric. From the overall system's point of view, decentralized not be as efficient centralized one. In practice, alternative mechanisms often used align incentives different managers chain. This paper discusses cost...

Advances in information system technology have had a huge impact on the evolution of supply chain management. As result such technological advances, partners can now work tight coordination to optimise chain-wide performance, and realised return may be shared among partners. A basic enabler for is sharing, which has been greatly facilitated by advances technology. This paper describes types inventory, sales, demand forecast, order status, production schedule. We discuss how why this using...

(This article originally appeared in Management Science, April 1997, Volume 43, Number 4, pp. 546–558, published by The Institute of Sciences.) Consider a series companies supply chain, each whom orders from its immediate upstream member. In this setting, inbound downstream member serve as valuable informational input to production and inventory decisions. This paper claims that the information transferred form “orders” tends be distorted can misguide members their particular, variance may...

The web is having a significant impact on how firms interact with each other and their customers. Past stumbling blocks for supply chain integration such as high transaction costs between partners, poor information availability, the challenges of managing complex interfaces functional organizations are all dissolving web. In this paper, we examine changing management. We present survey emerging research e‐business management including descriptive frameworks, analytical models, empirical...

This paper investigates the impacts of a secondary market where resellers can buy and sell excess inventories. We develop two-period model with single manufacturer many resellers. At beginning first period order receive products from manufacturer, but at second period, they trade inventories among themselves in market. endogenously derive optimal decisions for resellers, along equilibrium price The creates two interdependent effect—a quantity effect (sales by manufacturer) an allocation...

In this paper we develop a product life-cycle model that studies set of strategic choices facing manufacturers as they design the joint product/service bundle for which may require maintenance and repair support after its sale. The choice parameters interest include price, quality after-sales service price to be charged service. We adopt competitive, game-theoretic (as opposed single-firm optimization) framework, where there is competition provision between manufacturer an independent...

Stereotypically, marketing is mainly concerned about satisfying customers and manufacturing interested in factory efficiency. Using the principal-agent (agency) paradigm, which assumes that managers of firm will act their self-interest, we seek incentive plans induce those to so owner can attain as much possible residual returns. One optimal plan be interpreted follows: The subcontracts pay manager a fixed rate for all capacity he delivers. Each receives returns from his product. In turn,...

As RFID technology matures and organizations seek to deploy it in their business operations, a basic objective the endeavor is that of extracting value from technology. This paper examines three dimensions proposition attempts identify areas for further investigation. The first dimension consists generic architecture implementations drivers can result its components. second measurement issues associated with quantification value. Since complete benefits will only when multiple independent...

Software contracting is a multi-faceted issue that involves legal, economic, managerial and technological considerations. To better understand the economic aspect of software contracting, this paper provides summary review development contracts, followed by gametheoretic model developed to incorporate incentive information issues associated with contracting. In an outside contractor hired develop system over multiple periods. Due uncertainties about costs or technology, developer faces risk...

Abstract This paper proposes a taxonomy of coordination study in operations. Its point departure is the assumption that operations always involves “system” which can be mathematical model, software system, business process or game. A system unit analysis taxonomy. In taxonomy, systems are first divided into three categories depending on type ‐ within operations, cross‐functional and inter‐organizational coordination. Systems further how people organization behave, i.e., perspective...

Price protection is a commonly used practice between manufacturers and retailers in the personal computer (PC) industry, motivated by drastic declines of product values during life cycle. It form rebate given manufacturer to retailer for units unsold at when price drops controversial policy PC industry because it not clear how such benefits supply chain its participants. We show that an instrument channel coordination. For products with long manufacturing lead times, so has single buying...

In this commentary, we trace back how pursued research on the bullwhip effect, which resulted in article published Management Science. We reflect evolution of concept, impact that our work has had industry, way been used teaching supply chain management, and key directions have taken place since then.

This paper studies the incentives behind adoption of radio-frequency identification (RFID) in a supply chain. One prominent feature RFID technology is that once tags are attached on items at an upstream site, same can be reused its downstream sites lower or zero variable cost. creates interesting, one-sided “free-rider” problem, where would wait to free-ride upstream's first move, but not vice versa. Using stylized game-theoretic model, we characterize equilibrium strategies two firms....

Consider a data communication network owned and operated by single organization. The has an infinite number of small users is managed system manager (SM) whose objective to maximize the net value as whole. this paper study pricing mechanisms that induce optimal arrival rates when SM no full knowledge demand in advance. We investigate behavior under three alternative dynamic rules users' expectations models, characterize equilibrium its stability conditions.

This paper studies the role of demand uncertainty in temporal discrimination when retailer applies markdown pricing facing strategic customers. We consider a model which retail firm announces pair declining prices for two selling periods, and customers with heterogeneous valuations each decide whether to buy unit early, later or never. In this model, if function is linear its parameters are common knowledge, there never exist any that achieve feasible parameters. Either all buying wait,...

A tariff is the total charge payable by a customer for services provided. We study design of tariffs telecommunications service provider. develop an economic model that captures negative externalities network and diversity customers. The designed so it reflects expected response different customers system congestion would induce. simple structure in wide use mobile phone carriers—a menu “fixed-up-to (FUT)” plans like “fixed access fee $35 up to 300 minutes, $0.40 per minute beyond limit.”...