Studying the Value of Information Sharing in E-Business Supply Chain Management

Abstract

The supply chain management of goods and services involves multiple trading partners such as raw-material suppliers, manufacturers, distributors, and retailers. Every one of these trading partners need to determine their requirements, in terms of merchandise, and match them against availability, pricing, and cost of transportation. At every step of the supply chain economics information retrieval is a crucial and recurring process. In this paper we study information sharing as a strategy for improved decision making that can increase the profitability of the entire supply chain. We describe various different models for information sharing and illustrate the benefits of information sharing using ordering relationships among the trading partners of a simple four-node supply chain. In order to examine the relationship between different variables and the well-known bull-whip effect, we develop a simulation system to quantify the variables and generate different results in different scenarios. These results are analyzed in this paper, and implications are presented.

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