Decision-makings For Supply Chain With Consumer Preference To Low Carbon And Potential Disruptions

With the development of society, the role of human is always at the core status and is more and more important in the Operation Management (OM) system. In practice, because the rationality of human is limited, paying attention to human behavior factors in the study of OM issues is extremely important. Some scholars believe that behavioral factors are likely to be a source of Management Science paradigm shifting. Therefore, the introduction of behavioral factors to the OM research--Behavioral Operations Research (BOR) has a good prospect and important theoretical research value.As a spotlight of both the industry and the academia, BOR is in the ascendant and is widely regarded as a new opportunity for the development of OM. The studies are mostly given from the perspective of decision-makers’ behavioral tendencies in the existing researches. And the studies of consumers’ behavioral factors are very rare. With a deteriorating ecological environment, human survival is facing growing challenges. One of the most significant challenges is global warming caused by huge amounts of emissions of greenhouse gases such as carbon dioxide (CO2). Hence, worldwide attention is paid to reducing carbon emissions which is a leading issue to alleviate environmental degradation. Over the past few years, a lot of efforts have been made for the control of carbon emissions because of their importance in reducing the greenhouse effect. Therefore, a crossover interdisciplinary study is given taking the both two focal issues into consideration in this paper. This paper represents the attempt to introduce consumers’preference to low-carbon consumption in the analysis of a supply chain.This paper focuses on the impact of consumers’preference to low carbon in the emission-concerned supply chain. In an emission-concerned supply chain, the consumers are assumed to prefer to low-carbon products. In an emission sensitive market, emission reduction not only brings the higher production costs but also stimulates the inverse demand function. Therefore, this may be an opportunity for players of the supply chain to coordinate their two objectives:environmental pressure (to reduce carbon emissions for environment protection) and profit-seeking, which intuitively seem to be contradictory. In order to address this research focus, a novel emission-sensitive demand function is adopted, and an emission-sensitive cost function is introduced explicitly to capture the deviation production cost caused by emission reduction. Then the decision making of each member in the emission-concerned supply chain is investigated. The result shows that the decision-maker of the supply chain will choose different emission reduction strategies for different cases. An inspiring result shows that the channel profit as well as the emission reduction increase in the consumers’preference to low-carbon consumption simultaneously in particular cases. Moreover, several emission-concerned contracts are designed to coordinate the channel. Another finding is that the manufacturer’s optimal carbon emissions per unit product keeps the same as the centralized channel, no matter whether the supply chain is coordinated or not. Furthermore, the further discussion reveals that less eco-friendly production than the traditional, if lack of external regulation as well as internal moral self-discipline, might be chosen under some specific conditions.Then, we have studied another hot topic--emergency management. In order to improve the supply chain performance under emergency conditions, we focus on how to outfox the threat by considering potential disruption in advance and draw some interesting conclusions.Today, there are many uncertainties in the complex and volatile market environment. These uncertainties may be caused by the internal factors of the operation system or the external disruption (such as natural disasters, public health emergencies). For the supply chain system, the most direct impact is the demand uncertainty. Therefore, the paper takes the bidirectional impact of the potential disruption in the selling season on market demand into account by introducing so-called disruption-dependent demand. The possible negative demand associated with disruption is particularly concerned. Based on the formulation for the disruption-dependent demand, an analytical model is proposed to study the Stackelberg game process between single supplier and single retailer (newsvendor), then how the stochastic characteristics of disruption, as well as the sensitivity of demand to disruption, affect the decision-makings are further investigated.The paper points out that, in response to the potential disruption in sales season, the retailer’s optimal order quantity will deviate with respect to the conventional case. It confirms the random characteristics of the potential disruption have a significant impact on supply chain. Based on the analysis, the results are summarized as follows: if the mean of the potential disruption is big in selling season, the expect market scale will increase. And the retailer will increase the order quantity to seek profit maximization. Then the supplier will increase the wholesale price in order to share the benefits. In this case, both of their expected profits will be improved. If the variance (volatility) of the potential disruption is great in selling season, the uncertainty of the market scale will increase. And the retailer will reduce the order quantity to avoid the risk. Then the supplier will share part of the risk by lowering the wholesale price in order to encourage the retailer to order. In this case, the supplier’s expected profit will decline and the retailer’s expected profit will decrease after an initial increase. The demand is more sensitive to the potential disruption, the impact on the volatility of the market scale will be more significant. And the retailer will reduce the order quantity to avoid the risk. Then the supplier will share part of the risk by lowering the wholesale price in order to encourage the retailer to order. In this case, the supplier’s expected profit will decline and the retailer’s expected profit will decrease after an initial increase. Additionally, a numerical analysis is provided to show the application of the model.