Journal
TRANSPORTATION RESEARCH PART E-LOGISTICS AND TRANSPORTATION REVIEW
Volume 114, Issue -, Pages 331-342Publisher
PERGAMON-ELSEVIER SCIENCE LTD
DOI: 10.1016/j.tre.2018.01.005
Keywords
Supply chain; Quality management; Reward contract; Incentive; Target quality
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Funding
- National Research Foundation of Korea (NRF) grant - Korea government (MSIT) [NRF-2015R1C1A1A02036682]
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This paper investigates several incentive mechanisms for collaborative product quality improvement in a buyer-driven supply chain, and the impacts of those mechanisms on supply chain performance. The buyer, the Stackelberg leader, determines the sales price of a product while the supplier is responsible for production and product quality determination. We develop analytical models incorporating two reward schemes to better understand how the buyer can facilitate the supplier's quality improvement efforts. We offer managerial insights and practical guidelines for implementing quality management in the supply chain, derived from both an analytical comparison and numerical experiments.
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