Simulating the performance of supply chain with various alliances

Many models of supply chain management (SCM) have been popularly developed in recent years. However, this study focuses on the supply chain (SC) performance with respect to various alliances among partners. First, this study explores the game theory for formulating the SCM problem as a multi-objective programming problem. Second, various alliances, e.g., union, extreme competition, and Stackelberg competition among partners will be considered in such a problem so as to compare the SC performance under different alliances. Third, a numerical example is illustrated by two material supplier partners, three manufacturing partners, two logistics partners, and three customers, where each partner in the SC has its own objective and constraints. This SC problem is resolved across three different time periods. Finally, study results show that the maximum global benefits can be obtained only when all partners form a single union, but the inefficient partners lose significantly in such a union. The minimal global benefits exist in the extreme competition.

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