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Solving the order promising impasse using multi-criteria decision analysis and negotiation

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Logistics Research

Abstract

In an inter-firm make-to-order production environment, it is not always possible to satisfy the available-to-promise (ATP) and capable-to-promise (CTP) conditions due to untimely and unmatched production capacity and customer demand. Therefore, it is important to quickly explore alternate solutions that would satisfy both the customers and the suppliers. The purpose of this paper is to present a multi-agent-based system for automated multi-attribute negotiation in order promising. Our proposed solution is based on concepts of evolutionary system design that advocates for continued exploration of new solutions until a satisfactory solution is found. Based on a number of real-life ordering situations—changes of delivery date, price adjustments, and addition/modifications of value-added services as part of the order package, we embed multi-attribute multi-utility simulations into a linear program to search for a negotiated solution when a typical ATP/CTP function of a supply chain management system fails to fulfill a customer order.

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Acknowledgments

This research is supported by the DAAD (German Academic Exchange Service) through the PPP-program.

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Authors and Affiliations

  1. Deutsche Post DHL, Bonn, Germany

    Christoph Hempsch

  2. RWTH Aachen, Aachen, Germany

    Hans-Jürgen Sebastian

  3. University of Hawaii, Honolulu, HI, USA

    Tung Bui

Authors
  1. Christoph Hempsch
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  2. Hans-Jürgen Sebastian
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  3. Tung Bui
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Correspondence to Hans-Jürgen Sebastian.

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Hempsch, C., Sebastian, HJ. & Bui, T. Solving the order promising impasse using multi-criteria decision analysis and negotiation. Logist. Res. 6, 25–41 (2013). https://doi.org/10.1007/s12159-012-0094-9

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  • DOI: https://doi.org/10.1007/s12159-012-0094-9

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