Collaborative Procurement Research Articles

A framework for semiconductor industry supply chain planning: perspectives of intelligent enterprise

Supply chain planning in the semiconductor industry integrates the complex network of wafer foundries, probe and assembly manufacturing sites together to enhance operational effectiveness. So, the supply chain planning system should aggregate data from multiple sources to provide visibility and interoperable collaboration to an extended network of stakeholders. While exploring buyer-supplier collaborative relationships and new procurement opportunities, the present work proposes the perspectives of business planning, supply management, demand management, multi-echelon inventory optimization, customer order fulfilment, and transportation and logistics management. The novelty of this work lies in the simultaneous consideration of six interrelated perspectives of supply chain planning along with the perspective of collaboration among supply chain enterprises on the basis of information sharing. The proposed framework captures the technological and business basis for integration of various elements for supply chain planning for cost-efficient intelligent enterprises.

Horizontal collaboration in logistics: a feasible task for group purchasing

Current attention to the argument of collaborative procurement has been investigated by both academia and industry practitioners as the concept of group purchasing. This paper first reviews the literature on horizontal collaboration in purchasing task and recognises the interface between purchasing progress and the logistical point of view of supply as the accomplishing task of the procurement cycle. Secondly, it examines the effects of a successful horizontal collaboration in logistics activities among a group of small and medium sized food enterprises (SMEs) which have participated in a purchasing consortium. ‘Homo-regional firms’ are introduced as a logistics concept illustrating the potentiality in establishing horizontal collaboration in logistics activities in order to gain a competitive advantage. Methodology consists of data collection through quantitative questionnaires in direct contact with the firms. The results show a reduction of 10% to 30% in outbound logistics cost in comparison to the time period in which the firms were undergoing procurement by themselves.

Collaboration as an anti‐crisis solution: the role of the procurement function

PurposeThe length and sheer scale of the current economic crisis has surprised most managers, who were unprepared to deal with such a situation. Standing at the heart of their businesses, procurement managers need to limit the negative impact of the crisis. Restructuring and cost killing are usually the first responses. However, some buyers are pioneering a new kind of collaborative management that, instead of increasing the pressure on suppliers and reducing risk‐taking to a minimum, advocates taking new initiatives. The purpose of this paper is to present a new, “collaborative buyer” approach to the management of the procurement function.Design/methodology/approachThis qualitative research uses a constructivist methodology based on interviews of 12 buying experts. It develops scenarios and identifies the features of collaborative procurement. In order to map the future of the procurement function, this research looks at the expectations and forecasts of the players involved. The aim is a comprehensive, long, rational, ownership approach that is action oriented.FindingsThe paper offers an overview of new, foresight‐based procurement practices, based on the subtle but precise perception of the faint signs of coming change by people immersed in the procurement sector. The procurement professionals agreed to co‐construct a new buyer profile resulting from changes to the old buyer profile and the convergence of other occupations with new skills and expertise.Originality/valueThe aim is to carefully co‐construct a picture of the future of the procurement function. The paper presents new forms of internal and external collaboration, the roles and specific skills of this type of “buyer of the future,” and how the globalised economy is becoming an increasingly community based, collaborative virtual environment.

Wiley encyclopedia of operations research and management science

Use of Lagrange Interpolating Polynomials in RLT. Systems in Series. Parallel Configurations. Spanning trees. Recycling. Split Cuts. Retrial Queues. Horse Racing. MACBETH (Measuring Attractiveness by a Categorical Based Evaluation Technique). Dual simplex. History of CP. Procurement Contracts. MRP. Just in Time. Push and Pull Production. MULTIVARIATE INPUT MODELING. Operational Research Society. The M/G/1 Queue. Drama Theory. Hyper-heuristics. Antithetic Variates. Music. Edgeworth market games. Operational Risk. Queueing Notation. Environmental impact. Why variance is not risk. Conjugate gradient methods. Birth-and-Death Processes. Surgery Planning and Scheduling. Large-scale linear models. Standby Systems. Billiards/Pool. AXIOMATIC MEASURES OF RISK AND RISK-VALUE MODELS. Age Replacement Policies. PASTA and Related Results. Collaborative Procurement. LP projection algorithms. R&D risk management. Bioterrorism. Vendor-Managed Inventory. Gomory Cuts. Travel demand modeling. System Availability. Infinite horizon problems. Trust. Bayesian Network Classifiers. Integer Programming Duality. Queueing Disciplines. Stakeholder participation. Models and Basic Properties. Parametric LP analysis. Operations Research and Golfing. Ice Hockey. Clustering. Finite-Population Models. Batch Arrivals and Service. Optimal Monitoring Strategies. Basic Polyhedral Theory. Operations Research and Art. Managing portfolios of risks. Measures of risk equity. Branch and Bound Algorithms. Analytics in Retail. Variational Inequalities. Cross-Entropy Method. TSP heuristics. Capacity allocation. Control Variates. Cover Inequalities. Direct Search Methods. NLP Software. Bilinear optimization. Discrete-Time Martingales. Branch and Price. Column generation. IP Preprocessing. Optimal Reliability Allocation. Simplex-based LP solvers. Instance Formats. Clique generalizations. Availability in Stochastic Models. Evolutionary Algorithms. Basic CP theory: Search. Multimethodology. Branch and Cut. Memetic Algorithms. Urban mass transit. Coherent Systems. Subgradient optimization. Klimov's Model. Credit risk assessment. Branch-width and Tangles. Stochastic Hazard Process. Deterministic Global Optimization. Multistage (stochastic) games. Basis Reduction Methods. ACCIDENT PRECURSORS AND WARNING SYSTEMS MANAGEMENT: A BAYESIAN APPROACH TO MATHEMATICAL MODELS. Genetic Algorithms. Newsvendor models. Parallel Systems. Opportunities in Tennis. Job-shop scheduling. Simplex method and complexity. Geometric programming. Evacuation Planning. The Performance? Allocation Games. Scenario Generation. Robustness Analysis. Dynamic auctions. Neuroeconomics and game theory. Common Random Numbers. Selective Support Vector Machines. Semi-Markov Processes. Risk Averse Models. Sampling Methods. Domination problems. Simulation of Rare Events. Introduction to Tabu Search. Basic Interdiction Models. Introductory Concepts. Remanufacturing. PAUSE procedure. Wardrop equilibria. Mass customization. Ellipsoidal algorithms. Benders decomposition. Dynamic vehicle routing. Warranty Modeling. Design for Network Resiliency. Passenger rail transportation. Vehicle Routing Problem. Supply Chain Outsourcing. Lovasz-Schriver Reformulation. Hazard Rate Function. Lot-sizing. Differential games. Regenerative Processes. Guided Local Search. Preferences for repeated gambles. Percolation Theory. Simulated Annealing. Scoring Rules. Mixing Sets. Cricket. Prospect Theory. Combining Forecasts. Graph search techniques. Quasi-Newton methods. Random search algorithms. Supply chain coordination. Service Outsourcing. Markov Renewal Processes. K-out-of-n Systems.

Deriving business processes with service level agreements from early requirements

When designing a service-based business process employing loosely coupled services, one is not only interested in guaranteeing a certain flow of work, but also in how the work will be performed. This involves the consideration of non-functional properties which go from execution time and costs, to trust and security. Ideally, a designer would like to have guarantees over the behavior of the services involved in the process. These guarantees are the object of Service Level Agreements. We propose a methodology to design service-based business processes together with Service Level Agreements that guarantee a certain quality of execution, with particular emphasis on security. Starting from an early requirements analysis modeled in the Secure Tropos formalism, we provide a set of user-guided transformations and reasoning tools the final output of which is a set of processes in the form of Secure BPELs together with a set of Service Level Agreements to be signed by participating services. To show the potential impact of the approach, we illustrate the functioning of the methodology on a collaborative procurement scenario derived from the application domain of a research project.

Collaborative Cost Reduction and Component Procurement under Information Asymmetry

During development of an innovative product there is often considerable uncertainty about component production cost, and it is of interest for both the manufacturer and the supplier to engage in a collaborative effort to reduce this uncertainty and lower the expected cost. Despite the obvious benefits this brings, the supplier may be reluctant to collaborate as he fears revealing his proprietary cost information. We investigate how information asymmetry and procurement contracting strategies interact to influence the supply chain parties' incentives to collaborate. We consider a number of procurement contracting strategies, and identify a simple strategy, Expected Margin Commitment (EMC), that effectively promotes collaboration. The manufacturer prefers EMC if collaboration leads to a large reduction in unit cost and/or demand variability is low. Otherwise, a screening contract based on price and quantity is preferred. We also find that, paradoxically, ex-post efforts to enhance supply chain efficiency may hinder ex-ante collaboration that precedes production.

Building information modelling: the UK legal context

PurposeThe purpose of this paper is to identify some of the legal problems posed by full adoption of building information modelling (BIM) for construction design, and to propose a potential procurement solution for implementation in the UK.Design/methodology/approachLegal problems associated with BIM implementation are identified from a literature review, which is then drawn on to outline a potential best practice model for BIM procurement. Two US BIM procurement initiatives – American Institute of Architects (AIA) Document E202 and ConsensusDOCS 301 – are then analysed in relation to their fit with the model for BIM procurement in the UK market.FindingsDrawing on lessons learned from the AIA and ConsensusDOCS initiatives, the paper concludes that collaborative procurement, perhaps by way of partnering, appears to be an appropriate model for BIM procurement in the UK. However, it notes that empirical research is required in order to identify precisely the best legal approach.Research limitations/implicationsThe paper is a scoping work, identifying the ground which needs to be explored before firm conclusions can be drawn.Originality/valueThe legal aspects of BIM procurement remain a relatively unexplored field, and this analysis instructively draws together many of the key threads.

The influence of a collaborative procurement approach using integrated design in construction on project team performance

PurposeThe purpose of the paper is to study the influence of procurement on the performance of integrated design teams.Design/methodology/approachThe research paradigm is based on Russian socio‐constructivist approach to activity theory. Activity theory, as opposed to natural or social science, is a design science approach that focuses on the context aspect of project. A triangulation of qualitative research methods is used to investigate the dynamic of integrated teams in two different procurement contexts.FindingsThe paper is conclusive regarding the influence of procurement on team efficiency. It demonstrates that traditional procurement processes reinforce socio‐cognitive barriers that hinder team efficiency. It also illustrates how new procurement modes can transform the dynamic of relationships between the client and the members of the supply chain, and have a positive impact on team performance.Practical implicationsThe paper demonstrates first that problems with integrated design team efficiency are related to context and not process – they are not technical but socio‐cognitive; second that fragmented transactional contracting increases socio‐cognitive barriers that hinder integrated design team performance; third that new forms of relational contracting may help to mitigate socio‐cognitive barriers and improve integrated design team performance, fourth that changing the context through procurement does not address the problem of obsolete design practices.Originality/valueThe paper brings together theories of production in lean construction and social learning as a rival approach to traditional project management theory for demonstrating the importance of context on team performance.

Collaborative procurement among competing buyers

AbstractCollaborative procurement emerged as one of the many initiatives for achieving improved inter‐firm coordination and collaboration. In this article, we adopt a game‐theoretical approach to study the interaction between two firms who procure jointly, but produce independently and remain competitors in a product market characterized by price‐sensitive demand. We study the underlying economics behind collaborative procurement, examine the effects of collaboration on buyer and supplier profitability, and derive conditions under which collaboration is beneficial to each participant. We find that a necessary and sufficient condition for a buyer to collaborate is to increase its sales. We identify the conditions that lead equal size buyers (i.e., consortia consisting of only large buyers or only small buyers) versus different size buyers to collaborate. We also determine the conditions that make collaboration profitable for the supplier, and show that rather than selling a large quantity to a single buyer, the supplier prefers to sell to multiple buyers in smaller quantities. © 2008 Wiley Periodicals, Inc. Naval Research Logistics, 2008

Developing the partner relationship management system for franchised electronic stores

The internet age and e-business have not only modified the way enterprises see its customers but have also brought some significant changes to the way enterprises interact with each other. The purpose of this study is to develop a Partner Relationship Management (PRM) system to fit the partner management process and to provide necessary tools focusing on the characteristics of franchising e-stores, which can improve partner relationship in the Franchising Electronic Store Model (FESM). The functions of the PRM system were derived after reviewing the related literature. The PRM system comprises six modules: partner management, partner training, sales management, collaborative procurement, marketing information sharing and business operating know-how. Through empirical testing, the study also provides evidence that all modules of the PRM system can increase the satisfaction of the partner relationship of the franchisees.

Choosing an organisational form: the case of collaborative procurement initiatives

This paper deals with different organisational forms of collaborative procurement and provides insight into when to use which form. Different forms from the literature are compared with empirical examples to give an overview of forms, which are then described in terms of strategy, skills and organisation. Whilst acknowledging variations, the paper distinguishes between two main forms: virtual networks and third-party organisations. Using empirical data and four theoretical perspectives (transaction cost economics, resource-based view, contingency theory, agency theory), the paper reflects on when which form can be used and presents an overall framework to help choose an organisational form.

Assessing the applicability of collaborative procurement systems

The advent of new technologies in automation, information, and path structures will drive commercial development towards retail chains, maximisation, and strategic alliances between businesses. A case study was used to examine how integration can help a company achieve supply chain maturity and procurement activity and business performance improvements. Supply chain maturity includes emphasised function, inside integration, outside integration, and business cooperation. Procurement management considerations involved determining the proper supplier, quality, time, price, and quantity of the product being purchased. Greater maturity was a facilitator, positively influencing procurement activities. Both supply chain maturity and procurement activities had a significant influence on business performance.

Collaboration on procurement of e‐content between the National Health Service and higher education in the UK

PurposeCollaboration on procurement of e‐content between health libraries in the National Health Service (NHS) and in higher education (HE) should have advantages in increasing their negotiating power to improve licence terms and avoiding unnecessary duplication of content. The aim of the paper is to examine some of the strategies for ensuring that collaboration across the two sectors works effectively. The paper is based on a report to the Joint Information Systems Committee of the Funding Councils (for higher and further education) in the UK, and the NHS Library and Knowledge Development Network, on research conducted in 2006.Design/methodology/approachThe methods included interviews (n=39) with representatives from NHS and higher education bodies, representatives of independent health libraries, the National Library for Health, collective agencies, publishers and aggregators.FindingsThere were common interests in functionality/interfaces, open access, and better metrics for estimating usage that might contribute to discussions with publishers over the licence terms. There are differences in the type of resource each sector might deem to be core. The extent of existing collaboration on purchasing and related collection management activities varied considerably across the UK. Three possible paths for cooperative activity were identified: sharing information and joint advocacy; building the technical infrastructure; and joint procurement. Mapping of the stages, roles, actors and stakeholders in some processes was done with “use cases” (Unified Modeling Language) to help identify some of the risks involved.Research limitations/implicationsPoor response from online surveys limited the validity of the forecasting of user needs. Usage statistics were difficult to obtain and compare.Practical implicationsThe paper concludes that collaborative procurement of e‐content activities should focus on health services research requirements, and open access needs across the sectors. More innovative analysis of usage statistics is required to profile usage and inform cost analyses of both the impact of new roles for health librarians, and cost analyses of e‐resources on a life cycle basis.Originality/valueThe paper develops new ways of examining the business processes required for collaborative procurement.

Combinatorial Auction Based Collaborative Procurement

Collaborative procurement has been considered as a vital link in many world-class supply chain strategies. Most of the previous studies or real-cases related to the e-marketplace or auction based collaborative procurement just covered the purchasing of distinct items. However, each buyer may have the purchase needs for multiple heterogeneous items at the same time. Likewise, large scale distributors or manufactures or who would like to sell items may have the combinatorial supply needs of selling two or more items simultaneously according to their situation. Therefore, in this research, we address a multi-agent based combinatorial auction model for collaborative procurement as a new business model that combines the strength of the combinational auction and the benefits of collaborative procurement. A representative combinatorial auction based collaborative procurement (CACP) process is presented, then, the system architecture and optimized bid selection modeling for CACP are described. Finally we show the viability of CACP through proof-of-concept prototype implementation and experiment results.

Contract Types: An Exposition of Cost - Price Relationships in a New Paradigm

Abstract Key decisions in procurement are contractor selection, price, and contract type. Resource managers should be deliberate in considering contract type because contracts by nature allocate risks and rewards and influence contractor performance and final price. Choice of contract type is particularly important in today's collaborative procurement environment wherein the contractor base is reduced, negotiation tends to replace market competition in pricing, and contractor management is critical. This article facilitates better procurement strategy and cost management with regard to contract selection by introducing a general contract equation and a mathematical exposition of cost-price relationships and incentive implications, in the context of a new paradigm of contract types. The paradigm portrays contracts in three general categories: fixed-price contracts, cost-reimbursable contracts, and risk-sharing contracts. Narrative, mathematical, and graphic depictions of these contract types provide important implications for risk allocation, incentives, and cost management.