Two-echelon supply chain coordination under information asymmetry with multiple types

Kerkkamp, R.B.O.; Heuvel, Wilco van den; Wagelmans, Albert

doi:10.1016/j.omega.2017.04.005

Cited by 36 publications

(26 citation statements)

References 30 publications

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“…Additionally, this study extends the research addressing asymmetry, performance, collaboration and integration in SCs (Kerkkamp et al ., 2017; Kumar et al ., 2016: Pomponi et al ., 2015; Ralston et al ., 2017) in several ways. Managers must be aware of the factors potentially limiting the effects of their strategic decisions, as highlighted by our research results: By examining dynamic relationships between asymmetry and performance in varying collaboration and integration environments, we establish that it is inappropriate for all firms to collaborate continually or to integrate activities, even in the long term.…”

Section: Discussionsupporting

confidence: 74%

The impact of asymmetry on performance in different collaboration and integration environments in supply chain management

Michalski

Botella

Narasimhan

2018

SCM

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Purpose This paper aims to examine the non-linear aspects of the relationship between asymmetry and performance in supply chains (SCs), under varying intensities of collaboration and integration. Design/methodology/approach The paper offers a useful new approach to designing strategic elements of supply chain management (SCM) relationships. Using the partial least squares method, an empirical study of 66 companies in Spain has been conducted to clarify contemporary relationships, suggest new directions and ultimately contribute toward developing SCM theory. Findings The influences of asymmetry on performance in varying collaboration and integration contexts are shown to be unstable and have non-linear paths. It is inappropriate for all firms to collaborate or integrate continually, even for a prescribed period. Furthermore, due to asymmetry, SCM processes are more complex. Research limitations/implications The results’ validity may be limited to contexts specific to Spanish SCs. It would be valuable to investigate the impact of asymmetry on firms’ performance and relationships in other markets. Practical implications Collaborations and integration between partners in a SC might change the role of asymmetry from restraining to improving performance. The best way to improve performance in asymmetric relationships is to collaborate. Certain dimensions of integration and full integration are not necessarily required to improve firms’ performance under asymmetry conditions. Originality/value The study adds a new viewpoint on SCM by suggesting that not all collaboration and integration developments lead directly to improved performance.

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Section: Discussionsupporting

confidence: 74%

The impact of asymmetry on performance in different collaboration and integration environments in supply chain management

Michalski

Botella

Narasimhan

2018

SCM

View full text Add to dashboard Cite

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“…Another example is Mangla S K (2015 [33]), who established a supplier's optimal return strategy model in the face of ambiguous market demands in cases where the retailer's grasp of market price provided a unilateral information asymmetry, which encouraged retailers to release optimal order quantities to improve overall supply chain performance. Kerkkamp R B O et al (2018 [34]) considered how the manufacturer designs the outsourcing screening contract to encourage the contractor to perform optimally in the product development process, under the double asymmetry of the contractor's capability and cost level information. In this paper, in the research of power battery disassembly system outsourcing, the identification contract is used to solve the problem of information asymmetry.…”

Section: Literature Reviewmentioning

confidence: 99%

Screening Contract Excitation Models Involving Closed-Loop Supply Chains Under Asymmetric Information Games: A Case Study with New Energy Vehicle Power Battery

Zhu

2019

Applied Sciences

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In closed-loop supply chain systems for power battery remanufacturing, recycling and dismantling tasks will be relegated to third-party recyclers. This has significant disadvantages, inasmuch as the asymmetric exchange of information regarding the level of recycling capacity and effort after signing a contract fiscal risks to the manufacturers. The purpose of this paper is to study the “adverse selection” of recyclers and “moral hazards” hidden in their purported effort levels, based on Information Screening Models in the principal-agent theory. Our information screening model for revenue sharing will be presented, and subsequently verified using numerical simulation to demonstrate the impact of the screening contract on the expected returns of both parties. Our results show that the sharing coefficient of the remanufacturing revenue for low-capability recyclers is distorted downwards, and only truthful reporting can retain profits. High-capacity recyclers will obtain additional information while retaining profit. At the same time, as the proportion of high-capacity recyclers in the market increases, the expected return of the entrusting party increases. One critical area where this will impact the Chinese economy is in the area of new energy vehicles. We investigate a case study of our approach in new energy vehicles, which are being used to reduced CO 2 emissions, but have environmentally hazardous batteries that must be recycled safely and economically.

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“…Compared to our lot-sizing setting, the EOQ problem considers a constant demand rate over time, an infinite time horizon, and divisible products. Several variations have been researched, such as the private information being continuous or discrete, and single-or twodimensional (see for example Corbett and de Groote (2000), Inderfurth et al (2013), Kerkkamp et al (2018), and Pishchulov and Richter (2016)). Another setting is the newsvendor problem under information asymmetry, which considers a single period but with uncertain demand.…”

Section: Related Literaturementioning

confidence: 99%

Two-echelon lot-sizing with asymmetric information and continuous type space

Kerkkamp

Heuvel

Wagelmans

2019

Omega

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We analyse a two-echelon discrete lot-sizing problem with a supplier and a retailer under information asymmetry. We assume that all cost parameters are time independent and that the retailer has single-dimensional continuous private information, namely either his setup cost or his holding cost. The supplier uses mechanism design to determine a menu of contracts that minimises his expected costs, where each contract specifies the retailer's procurement plan and a side payment to the retailer. There is no restriction on the number of contracts in the menu.To optimally solve this contracting problem we present a two-stage approach, based on a theoretical analysis. The first stage generates a list of procurement plans that is sufficient to solve the contracting problem to optimality. The second stage optimally assigns these plans to the retailer types and determines all side payments. The result is an optimal menu with finitely many contracts that pools retailer types. We identify cases for which the contracting problem can be solved in polynomial time and provide the corresponding algorithms. Furthermore, our analysis reveals that information asymmetry leads to atypical structures in the plans of the optimal menu, e.g., plans violating the zero-inventory property. Our solution approach and several results are directly applicable to more general problems as well.

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Two-echelon supply chain coordination under information asymmetry with multiple types

Cited by 36 publications

References 30 publications

The impact of asymmetry on performance in different collaboration and integration environments in supply chain management

The impact of asymmetry on performance in different collaboration and integration environments in supply chain management

Screening Contract Excitation Models Involving Closed-Loop Supply Chains Under Asymmetric Information Games: A Case Study with New Energy Vehicle Power Battery

Two-echelon lot-sizing with asymmetric information and continuous type space

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