TY - JOUR
T1 - Production lead-time hedging and coordination in prefabricated construction supply chain management
AU - Zhai, Yue
AU - Zhong, Ray Y.
AU - Li, Zhi
AU - Huang, George
N1 - Funding Information:
Authors are grateful to Zhejiang Provincial, Hangzhou Municipal, Lin’an City governments, ITF Innovation and Technology Support Programme (ITP/045/13LP), National Natural Science Foundation of China [grant number 51405307], [grant number 61540030], and Project Funded by China Postdoctoral Science Foundation [grant number 2015M570720].
Publisher Copyright:
© 2016 Informa UK Limited, trading as Taylor & Francis Group.
PY - 2017/7/18
Y1 - 2017/7/18
N2 - This paper studies a coordination scheme to solve a production lead-time hedging (PLTH) issue in the prefabricated construction supply chain management. To mitigate tardiness delivery owing to prefab production uncertainty, the project contractor (PC) prefers to inform the prefab factory (PF) an earlier due date which is termed as PLTH strategy. However, this strategy forces the PF to compress its production process. A balance must be optimised through the proposed PLTH coordination scheme. It includes a PLTH-related cost term, i.e. crashing money (charged by the PF to the PC) and a constant transfer term. Three models with different power structures are considered. Firstly, two Stackelberg games with alternative decision-making sequences and an equal power model are discussed to obtain the optimal PLTH amount and crashing money. Later on, a cost-sharing term is used to fairly allocate the system surplus. It is observed that this coordination scheme reduces the PLTH amount and ensures win–win coordination for both parties. Some interesting managerial implications are also obtained from comparison analysis and numerical studies.
AB - This paper studies a coordination scheme to solve a production lead-time hedging (PLTH) issue in the prefabricated construction supply chain management. To mitigate tardiness delivery owing to prefab production uncertainty, the project contractor (PC) prefers to inform the prefab factory (PF) an earlier due date which is termed as PLTH strategy. However, this strategy forces the PF to compress its production process. A balance must be optimised through the proposed PLTH coordination scheme. It includes a PLTH-related cost term, i.e. crashing money (charged by the PF to the PC) and a constant transfer term. Three models with different power structures are considered. Firstly, two Stackelberg games with alternative decision-making sequences and an equal power model are discussed to obtain the optimal PLTH amount and crashing money. Later on, a cost-sharing term is used to fairly allocate the system surplus. It is observed that this coordination scheme reduces the PLTH amount and ensures win–win coordination for both parties. Some interesting managerial implications are also obtained from comparison analysis and numerical studies.
KW - game theory
KW - prefabricated construction
KW - production lead-time hedging
KW - supply chain coordination
KW - supply chain management
UR - http://www.scopus.com/inward/record.url?scp=84987650406&partnerID=8YFLogxK
U2 - 10.1080/00207543.2016.1231432
DO - 10.1080/00207543.2016.1231432
M3 - Journal article
AN - SCOPUS:84987650406
SN - 0020-7543
VL - 55
SP - 3984
EP - 4002
JO - International Journal of Production Research
JF - International Journal of Production Research
IS - 14
ER -