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Coordination Schemes For Decentralized Supply Chain Planning
Coordination Schemes For Decentralized Supply Chain Planning
chain planning
Saïd Business School
University of Oxford
Hartmut Stadtler
Darmstadt University of Technology
Germany
Nilay Shah
Imperial College
United Kingdom
Richard Steinberg
University of Cambridge
United Kingdom
Reinder Lok
Maastricht University
The Netherlands
Within the vast literature devoted to the assignment problem,
decentralization has been one of the topics of interest.
Decentralization means that some of the subjects of the
assignment have some decision power in the assignment process.
We are interested in generalizations of the decentralized
assignment problem. These generalizations may arise from the
setting of supply chain planning in which companies may have
contradictory objectives in spite of being part of the same supply
chain. Consider for example the allocation of production tasks
among production plants belonging to the same company. One
can imagine that the objective of each single plant is to exploit its
full capacity. The owning company has to reconcile these possibly
contradictory objectives in such a way that total profit is maximal.
This may be difficult in case the production plants are able to
manipulate the company's production plan by behaving
strategically.
Dries Vermeulen
Maastricht University
The Netherlands
Our main motivation to study this co-dependency problem comes from the field of supply
chain planning. Consider a set of buyers faced with external demand over a planning
horizon. To satisfy this demand they request inputs from a set of suppliers. Both suppliers
and buyers face production capacities and the planning is made in a decentralized
manner. A well-known coordination scheme for this setting is the upstream approach,
where buyers report their daily demand to a distribution center, and suppliers report
maximal production capacities. The reports submitted by the buyers are now taken as a
benchmark for the production schedule that the distribution center reports back to the
suppliers. This schedule is constructed by requiring the suppliers to produce as early as
possible given their reported capacities.
Christopher Sürie
Darmstadt University of Technology
Germany