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Supply chain performance assessment and supplier and component importance identification in a general competitive multitiered supply chain network model

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Abstract

In this paper, we develop a multitiered competitive supply chain network game theory model, which includes the supplier tier. The firms are differentiated by brands and can produce their own components, as reflected by their capacities, and/or obtain components from one or more suppliers, who also are capacitated. The firms compete in a Cournot–Nash fashion, whereas the suppliers compete a la Bertrand since firms are sensitive to prices. All decision-makers seek to maximize their profits with consumers reflecting their preferences through the demand price functions associated with the demand markets for the firms’ products. We construct supply chain network performance measures for the full supply chain and the individual firm levels that assess the efficiency of the supply chain or firm, respectively, and also allow for the identification and ranking of the importance of suppliers as well as the components of suppliers with respect to the full supply chain or individual firm. The framework is illustrated through a series of numerical supply chain network examples.

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Acknowledgments

This research was supported by the National Science Foundation (NSF) Grant CISE #1111276, for the NeTS: Large: Collaborative Research: Network Innovation Through Choice project awarded to the University of Massachusetts Amherst. This support is gratefully acknowledged. The authors acknowledge two anonymous reviewers and the Editor for their careful reading of the paper.

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Authors and Affiliations

  1. Department of Management and Marketing, College of Business, Arkansas State University, State University, AR, 72467, USA

    Dong Li

  2. Department of Operations and Information Management, Isenberg School of Management, University of Massachusetts, Amherst, MA, 01003, USA

    Anna Nagurney

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  1. Dong Li
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  2. Anna Nagurney
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Correspondence to Anna Nagurney.

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Li, D., Nagurney, A. Supply chain performance assessment and supplier and component importance identification in a general competitive multitiered supply chain network model. J Glob Optim 67, 223–250 (2017). https://doi.org/10.1007/s10898-015-0371-7

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