Competition In The Supply Chain Collaboration Based On System Dynamics Simulation Study

Practice cannot always serve as the sole criterion for verifying theory, because sometimes it would cost too much. For instance, theories about Supply Chain Management, especially about collaboration and competition among companies in the chain are now emerging one after another. It seems impossible to inject huge money into a real supply chain only to see whether the theory works or not, for such a silly practice will surely waste fund and idle away time, and once lost, no way back! On considering the reasons aforesaid, System Dynamics, an aided simulation tool, was introduced into this paper, through which people could formulate a close-to-reality supply chain via computer technology and then acquired a reasonable outcome without high budget. Subsequently, people were freely allowed to observe the performance of theories concerning competition and cooperation under various conditions by inputting different initial values.First of all, this paper demarcated kinds of possible competition and cooperation in supply chain to make research clear. The chain was then divided into three parts: Manufacturer, Cost in Inventory and Overall Competition, respectively simulating three paramount links and involving nearly all the important functions.In the section of Manufacturer, an automatic "Push" product line was designed with strong flexibility so as to gear itself to any fluctuation in orders from downstream firm. In the part of Inventory Cost, research was launched on the optimum amount of each order leading to minimum inventory cost. Finally, the Overall Competition section saw a series of strategies conducted by the retailer through facility and service upgrading, to lift services and curtail distribution period in an attempt to attract orders, have edge over rivals and eventually occupy market share.Along with the in-depth analysis of three major links in the chain, this paper also demonstrated a triple-task facing businesses: enterprise in supply chain is asked to function as not only a warrior against counterparts in other chains, but also an assistant helping downstream firms, as well as one seeking help fromupstream firms. Meanwhile, I was trying to find the best way toward competition and cooperation for companies by simulation technology. Furthermore, some traditionally-wrong thoughts about supply chain management was to be questioned in this paper and then replaced by my fresh views.This paper witnessed three additional creations: 1. A simulation model reflecting the whole procedure of supply chain was constructed in spite of its initial simplicity, which would be a prototype for further extension in function. 2. Simulation tech, a traditional engineering science, was perfectly integrated with some issues of economics, providing the latter with a brand-new method in dealing with problems besides the game theory. 3. It has long been a complexity in judging whether a logistics theory was a good one or not due to its excessive qualitative nature. Fortunately, this now has been initially solved in this paper.By Liang Zhenyu (Industrial Economics)Directed by Prof. Qu Linchi& Associate Prof. Wang Xiaohui...