The performance impact of the extent of inter-organizational information sharing: An investigation using a complex adaptive system paradigm and agent-based simulation

Advances in information technology and the increasingly global marketplace continue to have a key impact on buyer-supplier relationships. Any type of inter-organization coordination begins with information exchange. Crucial decisions for organizations include how to obtain and properly use information from trading partners, and the ultimate effect of information on strategic decisions and supply chain performance.; To capture the complexity of a supply networks' relationships and interactions, methods such as agent-based simulation can provide a rich representation of complex supply networks systems. This is accomplished by explicitly modeling the individual organizations and the ways in which they interact and react to each other, which might otherwise be abstracted away. Such simulations are used to evaluate the dynamic behavior of complex systems as the organizational agents are subjected to changing schema, connectivity, and environmental variables. The idea of modeling a supply chain network as a complex system builds on the work of Choi et al. (2001). This research also incorporates empirical data within an agent-based modeling environment. And as Shafer and Smunt (2004) only identify a few published articles that use empirical simulation studies as their methodology in supply chain management, there is ample room for further empirical simulation research.; This research is also unique in that it explores information sharing both up and down the supply network. Specifically, information passed from the customer to the supplier in the form of POS data, as well as information passed from the supplier to its customers, in the form of lead-time estimates. It is among the first such studies to explicitly consider information sharing of both types simultaneously. Demand point-of-sale data is found to be generally beneficial to the manufacturer and be, at least, not worse for their customers in a setting with significantly more variability of demand than is generally considered in most studies and with stochastic transportation times. But shared information does not benefit all organizations alike. Shared lead-time information is often beneficial to the distribution centers particularly when lead-time variance is high and when demand volumes are high, but can cause the manufacturer to carry more inventory.