Game Theoretic Strategies for Supplier Capability Assessment and Manufacturing Order Allocation

Authors

Cheng-Kuang Wu^{1, *,} , Yu-Min Chuang²

¹School of Computer Science, Zhaoqing University, Zhaoqing Road, Zhaoqing City, Guangdong Province 526021, P. R. China

²Department of Industrial and Systems Engineering, Chung Yuan Christian University, Taiwan

^*Corresponding author. Email: shapleyvalue@hotmail.com

DOI

10.2991/jracr.k.201014.002How to use a DOI?

Keywords

Supplier power value; Nash equilibrium; Shapley value; supplier allocation

Abstract

An effective method is required to determine the amount and priority for the deployment of suppliers for multiple manufacturing processes, particularly when the available budget for each manufacturing process is limited. In this study, we propose an integrated approach for supplier assessment that consists of two game theory models which are designed to recommend manufacturers on how best to choose suppliers given budgetary limitations. In the first model, the interactive behaviors between the key factors representing the manufacturer and the supplier are modeled and analyzed as a two-player and zero-sum game, after which the Supplier Power Value (SPV) is derived from the pure or mixed strategy Nash equilibrium. In the second model, 12 SPVs are used to compute a Shapley value for each supplier, in terms of the thresholds of the majority levels in one manufacturing process. The Shapley values are then applied to create an allocated set of limited manufacturing orders for suppliers. The experimental results present that the manufacturer can use our approach to quantitatively evaluate the suppliers and easily allocate suppliers within one manufacturing process.

Copyright

© 2020 The Authors. Published by Atlantis Press B.V.

Open Access

This is an open access article distributed under the CC BY-NC 4.0 license (http://creativecommons.org/licenses/by-nc/4.0/).

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TY  - JOUR
AU  - Cheng-Kuang Wu
AU  - Yu-Min Chuang
PY  - 2020
DA  - 2020/10/24
TI  - Game Theoretic Strategies for Supplier Capability 
Assessment and Manufacturing Order Allocation
JO  - Journal of Risk Analysis and Crisis Response
SP  - 121
EP  - 129
VL  - 10
IS  - 4
SN  - 2210-8505
UR  - https://doi.org/10.2991/jracr.k.201014.002
DO  - 10.2991/jracr.k.201014.002
ID  - Wu2020
ER  -