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Some basic ideas of formal approaches to the problem solving can be introduced to cooperative decision-making. There are two aspects of the problem solving - representation and searching. The state space representation introduces the concepts of states and operators. An operator transforms one state into another state. A solution could be obtained by a search process, first applies operators to the initial state to produce new states and so on, until the goal state is produced. Communication between producers and retailers can be provided through information sharing (schemati- cally see Fig. 5). The proposed model is a discrete dynamic model and the cooperation of units is based on contracts and formal agreements achieved in negotiation process. We propose a two phases’ inter- active approach for solving cooperative decision making problems (see [2]): 1. Finding the ideal solution for individual agents.

Figure 5 Some basic ideas of formal approaches to the problem solving can be introduced to cooperative decision-making. There are two aspects of the problem solving - representation and searching. The state space representation introduces the concepts of states and operators. An operator transforms one state into another state. A solution could be obtained by a search process, first applies operators to the initial state to produce new states and so on, until the goal state is produced. Communication between producers and retailers can be provided through information sharing (schemati- cally see Fig. 5). The proposed model is a discrete dynamic model and the cooperation of units is based on contracts and formal agreements achieved in negotiation process. We propose a two phases’ inter- active approach for solving cooperative decision making problems (see [2]): 1. Finding the ideal solution for individual agents.

Related Figures (5)

Most supply chains are composed of independent units with individual preferences. Each unit will attempt to optimize its own preference. Behavior that is locally efficient can be inefficient from a global point of view. In supply chain behavior are many inefficiencies. An increasing number of companies in the world subscribe to the idea that developing long-term coordination and cooperation can significantly improve the efficiency of supply chains and provide a way to ensure competitive advantage. A structure of supply chains is composed of potential suppli- ers, producers, distributors, retailers and customers etc. The units are interconnected by material, financial, information and deci- sional flows (see Fig.1).
Most supply chains are composed of independent units with individual preferences. Each unit will attempt to optimize its own preference. Behavior that is locally efficient can be inefficient from a global point of view. In supply chain behavior are many inefficiencies. An increasing number of companies in the world subscribe to the idea that developing long-term coordination and cooperation can significantly improve the efficiency of supply chains and provide a way to ensure competitive advantage. A structure of supply chains is composed of potential suppli- ers, producers, distributors, retailers and customers etc. The units are interconnected by material, financial, information and deci- sional flows (see Fig.1).
A centralized solution assumes a single agent has complete information and controls the entire supply chain (this is referred as the first-best solution) to maximize supply chain profit We consider a supply chain with a producer and a retailer that sells a product. The producer produces each unit for a cost c and sells each unit to the retailer for a wholesale price p\. The retailer chooses an order quantity x and sells x units at price p(x), assuming that p(x) is decreasing, concave and twice differen- tiable function.
A centralized solution assumes a single agent has complete information and controls the entire supply chain (this is referred as the first-best solution) to maximize supply chain profit We consider a supply chain with a producer and a retailer that sells a product. The producer produces each unit for a cost c and sells each unit to the retailer for a wholesale price p\. The retailer chooses an order quantity x and sells x units at price p(x), assuming that p(x) is decreasing, concave and twice differen- tiable function.
Fig.3. Material, financial an information flows in network environment To achieve joint optimization of key supply chain decisions, it is preferable that there be a free flow of all relevant information across the entire network. Modeling of supply chains in network economy includes coordination of flows in different network struc- tures and combination of non-cooperative and cooperative deci- sions. The presented model considers three-layer network structur- es of producers, retailers and customers. An overview of material, financial an informational flows is schematically shown in Fig. 3.
Fig.3. Material, financial an information flows in network environment To achieve joint optimization of key supply chain decisions, it is preferable that there be a free flow of all relevant information across the entire network. Modeling of supply chains in network economy includes coordination of flows in different network struc- tures and combination of non-cooperative and cooperative deci- sions. The presented model considers three-layer network structur- es of producers, retailers and customers. An overview of material, financial an informational flows is schematically shown in Fig. 3.
Fig. 4. Supply chain network with e-commerce
Fig. 4. Supply chain network with e-commerce
Equilibrium conditions for producers (i = 1, 2, ..., m) are given oy the following equality system: Producer’s i profit is expressed as follows:
Equilibrium conditions for producers (i = 1, 2, ..., m) are given oy the following equality system: Producer’s i profit is expressed as follows:
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BusinessIndustrial OrganizationSupply Chain ManagementNetwork EconomySupply Network
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