A Study On Coordination Mechanism Of SCM Based On Game Theory

The coordination problem has been a major issue in supply chain management research. Coordination mechanism is always used to solve non-coordination problems between members of a supply chain. In this paper, the coordination problem is mainly discussed based on SCM theory and game theory.The concepts about coordination of SCM and game theory are firstly presented, and then the game relationship of the three-stage supply chain management members is been proposed. Firstly stack berg model and making price corporately are explored to discuss the necessity of the cooperation between the supplier and manufacturer. Secondly the situation is analyzed when there are two and N manufacturers in the market using Cournot model to get the optimization of quality and profit. Thirdly, the Nash model and stack berg model were built to discuss the relationship between the manufacturer and retailer. Based on above discussion, coordination mechanism is studied to make SCM more coordinated from the aspects of delivery date and the lot size between the vendor and purchaser.In the discussion of coordination mechanism about delivery date, it presents the necessity of integrating 6σto Supply Chain firstly., then analyze the design of supply chain satisfied 6σservice lever from date of delivery with example based on Process Capability Index. At last, two optimization design methods of 6σSupply Chain are discussed simply.In the model of lot size between the vendor and purchaser, a non-cooperation model with a vendor and a purchaser is discussed, and then a policy of price discount is introduced. At last, the stack berg game theory is proposed to coordinate the lot sizing between a vendor and a purchaser in supply chain based on make-to-order.