Decision policies on players’ different risk combination under supplier encroachment
RAIRO - Operations Research - Recherche Opérationnelle, Tome 54 (2020) no. 4, pp. 1057-1075.

Literature concerning about the supply chain management problem is usually based on perfect rationality. However, risk preferences have been proved to be an important role which influences managers’ decisions significantly. This paper investigates a risk combination problem under supplier encroachment with different risk preferences players. Assuming that the supply chain players may be risk-averse, risk-neutral and risk-taking, we build a Stackelberg game model to explore the optimal decisions and the impact of different risk combinations, respectively. We focus on two scenarios: the consumers perceive uniform quality between the two channels and perceive differentiated quality between the two channels. We find that the retailer always prefers a risk-averse supplier, while the supplier always prefers a risk-taking retailer. But the combination of a risk-averse supplier and a risk-taking retailer is not always beneficial to the whole supply chain. Further, we conduct numerical experiments to explore the risk combinations and the impacts of players’ selfish, aggressive and altruistic behaviors on optimal decisions.

Reçu le :
Accepté le :
Première publication :
Publié le :
DOI : 10.1051/ro/2019038
Classification : 90B50, 91A30
Mots-clés : Supply chain management, supplier encroachment, risk preferences, Stackelberg game
@article{RO_2020__54_4_1057_0,
     author = {Chen, Ping and Li, Bo and Huang, Huafei},
     title = {Decision policies on players{\textquoteright} different risk combination under supplier encroachment},
     journal = {RAIRO - Operations Research - Recherche Op\'erationnelle},
     pages = {1057--1075},
     publisher = {EDP-Sciences},
     volume = {54},
     number = {4},
     year = {2020},
     doi = {10.1051/ro/2019038},
     mrnumber = {4100700},
     language = {en},
     url = {http://archive.numdam.org/articles/10.1051/ro/2019038/}
}
TY  - JOUR
AU  - Chen, Ping
AU  - Li, Bo
AU  - Huang, Huafei
TI  - Decision policies on players’ different risk combination under supplier encroachment
JO  - RAIRO - Operations Research - Recherche Opérationnelle
PY  - 2020
SP  - 1057
EP  - 1075
VL  - 54
IS  - 4
PB  - EDP-Sciences
UR  - http://archive.numdam.org/articles/10.1051/ro/2019038/
DO  - 10.1051/ro/2019038
LA  - en
ID  - RO_2020__54_4_1057_0
ER  - 
%0 Journal Article
%A Chen, Ping
%A Li, Bo
%A Huang, Huafei
%T Decision policies on players’ different risk combination under supplier encroachment
%J RAIRO - Operations Research - Recherche Opérationnelle
%D 2020
%P 1057-1075
%V 54
%N 4
%I EDP-Sciences
%U http://archive.numdam.org/articles/10.1051/ro/2019038/
%R 10.1051/ro/2019038
%G en
%F RO_2020__54_4_1057_0
Chen, Ping; Li, Bo; Huang, Huafei. Decision policies on players’ different risk combination under supplier encroachment. RAIRO - Operations Research - Recherche Opérationnelle, Tome 54 (2020) no. 4, pp. 1057-1075. doi : 10.1051/ro/2019038. http://archive.numdam.org/articles/10.1051/ro/2019038/

[1] F. Arcelus, S. Kumar and G. Srinivasan, Risk tolerance and a retailer’s pricing and ordering policies within a newsvendor framework. Omega 40 (2012) 188–198. | DOI

[2] P. Artzner, F. Delbaen, J.M. Eber, D. Heath, Thinking Coherently. Risk 10 (1997) 68–71.

[3] A. Arya, B. Mittendorf and D.E.M. Sappington, The bright side of supplier encroachment. Marketing Sci. 26 (2007) 651–659. | DOI

[4] T. Avinadav, T. Chernonog and Y. Perlman, The effect of risk sensitivity on a supply chain of mobile applications under a consignment contract with revenue sharing and quality investment. Int. J. Prod. Econ. 168 (2015) 31–40. | DOI

[5] A.J. Bostian, C.A. Holt and A.M. Smith, Newsvendor “Pull-to-Center” effect: adaptive learning in a laboratory experiment. Manuf. Ser. Oper. Manage. 10 (2008) 590–608. | DOI

[6] A.O. Brown and C.S. Tang, The impact of alternative performance measures on single-period inventory policy. J. Ind. Manage. Optim. 2 (2006) 297–318. | DOI | MR | Zbl

[7] M.A. Carpenter, T.G. Pollock and M.M. Leary, Testing a model of reasoned risk-taking: governance, the experience of principals and agents, and global strategy in high-technology IPO firms. Strategic Manage. J. 24 (2003) 803–820. | DOI

[8] L. Chen, S.M. Gilbert and Y. Xia, Product line extensions and technology licensing with a strategic supplier. Prod. Oper. Manage. 25 (2016) 1121–1146. | DOI

[9] W.Y.K. Chiang, D. Chhajed and J.D. Hess, Direct marketing, indirect profits: a strategic analysis of dual-channel supply-chain design. Manage. Sci. 49 (2003) 1–20. | DOI | Zbl

[10] T.M. Choi, Impacts of retailer’s risk averse behaviors on quick response fashion supply chain systems. Ann. Oper. Res. 268 (2018) 1–19. | MR

[11] T.M. Choi, D. Li, H. Yan and C.H. Chiu, Channel coordination in supply chains with agents having mean-variance objectives. Omega 36 (2008) 565–576. | DOI

[12] Q. Cui, C.H. Chiu, X. Dai and Z. Li, Store brand introduction in a two-echelon logistics system with a risk-averse retailer. Transp. Res. Part E: Logist. Transp. Rev. 90 (2016) 69–89. | DOI

[13] Y. Dai and X. Chao, Price delegation and salesforce contract design with asymmetric risk aversion coefficient of sales agents. Int. J. Prod. Econ. 172 (2016) 31–42. | DOI

[14] O.C. Demirag, Performance of weather-conditional rebates under different risk preferences. Omega 41 (2013) 1053–1067. | DOI

[15] A. Ha, X. Long and J. Nasiry, Quality in supply chain encroachment. Manuf. Serv. Oper. Manage. 18 (2015) 280–298. | DOI

[16] J. He, K.S. Chin, J.B. Yang and D.L. Zhu, Return policy model of supply chain management for single-period products. J. Optim. Theory App. 129 (2006) 293–308. | DOI | MR | Zbl

[17] S. Hua, H. Jianmin, Y. Haowei and H. Shubin, Analysis of two-echelon supply chains with risk-bias participators. In Vol. 2 of International Conference on Intelligent Computation Technology and Automation (ICICTA). IEEE (2008) 621–625.

[18] C.H. Huynh and W. Pan, Operational strategies for supplier and retailer with risk preference under VMI contract. Int. J. Prod. Econ. 169 (2015) 413–421. | DOI

[19] W. Jammernegg and P. Kischka, Risk-averse and risk-taking newsvendors: a conditional expected value approach. Rev. Manage. Sci. 1 (2007) 93–110. | DOI

[20] W. Jammernegg and P. Kischka, Risk preferences and robust inventory decisions. Int. J. Prod. Econ. 118 (2009) 269–274. | DOI

[21] Z. Li, S.M. Gilbert and G. Lai, Supplier encroachment under asymmetric information. Manage. Sci. 60 (2013) 449–462. | DOI

[22] Q. Li, B. Li, P. Chen and P. Hou, Dual-channel supply chain decisions under asymmetric information with a risk-averse retailer. Ann. Oper. Res. 257 (2017) 423–447. | DOI | MR

[23] J. Liu and Y. He, Coordinating a supply chain with risk-averse agents under demand and consumer returns uncertainty. Math. Prob. Eng. 2013 (2013) 289572. | MR | Zbl

[24] M. Liu, E. Cao and C.K. Salifou, Pricing strategies of a dual-channel supply chain with risk aversion. Transp. Res. Part E: Logist. Transp. Rev. 90 (2016) 108–120. | DOI

[25] Y. Qin, R. Wang, A.J. Vakharia, Y. Chen and M.M. Seref, The newsvendor problem: Review and directions for future research. Eur. J. Oper. Res. 213 (2011) 361–374. | DOI | MR | Zbl

[26] P. Qinghua, Coordinating a two-level supply chain with risk-averse preferences based on revenue-sharing contractIn: Control Conference, CCC 27th 2008. IEEE, Chinese (2008) 774–779. | DOI

[27] R.T. Rockafellar and S. Uryasev, Optimization of Conditional Value-at-risk. J. Risk 2 (2000) 21–41. | DOI

[28] M.E. Schweitzer and G.P. Cachon, Decision bias in the newsvendor problem with a known demand distribution: Experimental evidence. Manage. Sci. 46 (2000) 404–420. | DOI | Zbl

[29] S.B. Sitkin and A.L. Pablo, Reconceptualizing the determinants of risk behavior. Acad. Manage. Rev. 17 (1992) 9–38. | DOI

[30] K.G. Smith, C.J. Collins and K.D. Clark, Existing knowledge, knowledge creation capability, and the rate of new product introduction in high-technology firms. Acad. Manage. J. 48 (2005) 346–357. | DOI

[31] B. Tedeschi, New Level of Competition: When a Supplier gets into its Customers’ Business. New York Times (2005).

[32] T. Wang and Q. Hu, Risk-averse newsvendor model with strategic consumer behavior. J. Appl. Math. 2013 (2013) 636259. | DOI | MR

[33] Z. Wang, W. Xing and S.C. Fang, Two-person knapsack game. J. Ind. Manage. Optim. 6 (2010) 847–860. | DOI | MR | Zbl

[34] G. Xie, W. Yue, S. Wang and K.K. Lai, Quality investment and price decision in a risk-averse supply chain. Eur. J. Oper. Res. 214 (2011) 403–410. | DOI | MR | Zbl

[35] L. Xue, Governance-knowledge fit and strategic risk taking in supply chain digitization. Decis. Support Syst. 62 (2014) 54–65. | DOI

[36] W. Xue, T.M. Choi and L. Ma, Diversification strategy with random yield suppliers for a mean¨Cvariance risk-sensitive manufacturer. Transp. Res. Part E: Logist. Transp. Rev. 90 (2016) 90–107. | DOI

[37] Y. Zhou, Q. Chen, X. Chen and Z. Wang, Stackelberg game of buyback policy in supply chain with a risk-averse retailer and a risk-averse supplier based on CVaR. PloS one 9 (2014) e104576. | DOI

Cité par Sources :