Manufacturing Enterprise Supply Chain Management, Transaction Costs And Decision Optimization

With the introduction of supply chain management, the focus of competition has migrated from the traditional enterprise level to the supply chain level. The systematic integration of all supply chain members and the cost reduction benefit all enterprises involved and improve their competence. In China, the adaptation of supply chain management will have a long-term impact on manufacturing enterprise collaboration, maintaining cost advantage and shortening time-to-market. However, most current supply chain management research is limited to the operations and information technology infrastructure and only addresses a certain area of supply chains. There is an increasing demand for research focusing on the economics and management of supply chains on a high level. As one effort in this direction, we studied the transaction cost and decision optimization problem in supply chain management in the context of manufacturing enterprises. Our work utilized theoretical models from transaction cost economics, game theory, information economics and business process reengineering.This dissertation is organized as follows. In the introduction, we compare supply chain management with other related concepts such as strategic alliance, virtual enterprise, vertical integration, and integrated logistics. In Chapters 1 and 2, we analyze the theoretic foundation of supply chain management and the reason why it has attracted worldwide attention. We conclude that, as one way to optimize the relationships between upstream and downstream enterprises, supply chain management has inherited and improved the vertical integration. Moreover, it has achieved Pareto improvement through the realization of cooperative games. Based on the customer-oriented principle and the demand-driven method in supply chain management, Chapters 3 to 6 analyze the decision optimization in sales, manufacturing, procurement and logistics respectively, in the context of a manufacturer in a supply chain. Chapter 7 focuses on the principal-agent problem existing between enterprises inside a supply chain and proposes the solution. To resolve the possible problems in the implementation of supply chain management in traditional enterprises, Chapter 8 discusses the urgent demand for the organizational reformation and introduces the new framework of enterprise organization. Chapters 9 and 10 introduce our empirical works in which we analyze the current characters of supply chain management, existing problems and directions of improvement in Chinese manufacturers based on the data from both the automobile industry and the Zhejiang Industrial Cluster. Major contributions of our works include:1. Based on the analytical framework of vertical integration from transaction cost economics, we analyzed the necessity of the migration from vertical integration to supply chain management. We pointed out that changes in the enterprise competition environment have removed the base that the existence and development of vertical integration relies on; and vertical integration will be replaced by supply chain management due to its slow response to market, high risks and failure to create and enhance the core competence.2. Based on game theory, we analyzed the competition and cooperation of enterprises within a supply chain, and pointed out that cooperative game provides the theoretical foundation for supply chain management. Due to the high-volume repeated games and information flows existing within the EDI or Internet-based infrastructure, enterprises are inclined to adopt the basic strategy of the cooperative game. The competition between supply chains provides the base for the existence of positive-sum games among enterprises within the same supply chain, enables Pareto improvement of supply chain management, and creates a win-win situation among these enterprises through the reduction of transaction costs, including the search cost, negotiation cost, contract execution cost and contract change cost.3. With a focus on the reduction of transaction costs, we analyzed the re...