|2nd author||Hyoung-Gon Lee
|info||This conference paper has been presented by Jinwoo Park on the International Conference on Advances in Production Management Systems. The conference has been held in Linkoping, Sweden, 2007/9/17 ~ 2007/9/19 .|
|start / end date|
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|keywords||supply chain, information sharing, utility value, fairness|
|abstract||The importance of information sharing between an enterprise and its customers or cooperating companies has been recognized from the early times in supply chain research area. Many previous studies revealed that the sharing of information could play an important role in eliminating inefficiencies caused by bullwhip effect, etc. However, since most of them have studied IS in a macroscopic way such as no/partial/full information sharing, they have been not much of practical value if we try to implement the idea for a specific SC (Supply Chain). The objective of this study is to suggest a practical guideline for IS (Information Sharing) in a specific SC by promoting the needs for sharing information with technical verifications using simulation, value analysis and the concept of profit sharing.
The current situation of hesitation in sharing information between the parties in a SC is understandable because there are some information that have strategic importance and maybe catastrophic if not controlled in a reasonable way. And we are going to analyze the consequences of IS in a systematic manner to each specific types of information.
The information in a SC may be briefly divided into two classes with regard to the directions of information flow: the supply side information such as production plan and the demand side information such as demand forecast. In order to make our points more clear, we assumed that the information types were extracted from a manufacturing enterprise which has a long term agreement with its suppliers and makes its product in an MTO( Make To Order) fashion. The types of information include not only production plans but also inventory levels, the plan for new product development, demand forecasting, current selling rate, available capacity, etc.
Now the types of information are re-classified into 3 levels according to their utility values and the direction of flow by modifying the classifications suggested in several previous survey reports. And the effect of IS at each level is studied using dynamic simulation models under specific conditions. A significant variation in SC performance has been found according to the level of the specific information involved, e.g. information that are regarded as critical resulted in high performance compared to others.
In the second part of our study, we briefly review the incentive scheme on profit sharing among the parties in a SC. Most of the conventional studies assumed that a third party sums up the total profit gains and then distribute them according to the contributions of the parties involved. However, this approach faces several problems including, for example, who assumes the role of the third party, or how to solve the ambiguity in the ways to distribute the profits, or how to get a unanimous agreement on contributions and opportunity cost reductions, etc.
In our approach, two flow directions in information and profit generation are taken into account in order to describe both manufacturers
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