Abstract
This paper develops a digital supply chain game, modeling marketing and operation interactions between members. The main novelty of the paper concerns a comparison between static and dynamic solutions of the supply chain game achieved when moving from traditional to digital platforms. Therefore, this study proposes centralized and decentralized versions of the game, comparing their solutions under static and dynamic settings. Moreover, it investigates the decentralized supply chain by evaluating two smart contracts: Revenue sharing and wholesale price contracts. In both cases, the firms use an artificial intelligence system to determine the optimal contract parameters. Numerical and qualitative analyses are used for comparing configurations (centralized, decentralized), settings (static, dynamic), and contract schemes (revenue sharing contract, wholesale price contract). The findings identify the conditions under which smart revenue sharing mechanisms are worth applying.
Highlights
Despite its recent advent, supply chain (SC) management was deeply investigated in terms of vertical and horizontal relationships, multitude of tactics and strategies, and various objectives, purposes, and targets, mainly based on the maximization of profit or minimization of costs [1]
Several contributions emphasized the need for implementing SC strategies, research is still needed to identify the best SC structure and the appropriate methodology for its analysis, especially with new technological disruptions like digitalization, Industry 4.0, and blockchains, which are deeply changing operations and supply chain management
The models do not observe the changes in system parameters, and the main characterization involves decisions on customer demand, vertical and horizontal competition within supply chains, and no risk involved, risk incurred by only one or few members, or risk shared between the participants [2]
Summary
Supply chain (SC) management was deeply investigated in terms of vertical and horizontal relationships, multitude of tactics and strategies, and various objectives, purposes, and targets, mainly based on the maximization of profit or minimization of costs [1]. According to the static literature, the general concept of Nash equilibrium applies for determining the optimal solution, allowing firms to maximize a certain payoff Starting from this general characterization, the literature proposes multitude types of scenarios including cooperative and non-cooperative settings, simultaneous and sequential decision-making (Cournot and Stackelberg games), vertical and horizontal competition, and embracing numerous areas as pricing (Bertrand’s competition) or production (Cournot’s competition). Dynamic setting incorporates decisions over time, resulting in an among inter-temporal interaction among supply chain members. Literature showed contributions identifying various contract the SC structures andPrevious the inter-temporal setting.numerous. Beyond presenting and comparing several decentralized SCs characterized by the adoption of WPC and RSC under static and dynamic frameworks, this research proposes the centralized solution, which is one main element of a digital supply chain.
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