The goal of the project is to develop decision framework aiming systematic support for logistics partners considering horizontal cooperation.
In order to improve the efficiency of transportation networks and in light of the growing debate on sustainability many initiatives have been taken, including the idea of horizontal co-operation, where companies at the same level of the supply chain join forces, for example, collaboration among suppliers. The main motivation for companies to collaborate is the fact that the total transportation cost of the coalition is lower than the sum of the stand-alone costs. Consequently, many companies are fundamentally changing their way of doing business by exceeding the border of standalone and individual actions toward collective actions and cooperative strategies. Therefore, building alliance appears as a successful strategy in modern supply chain networks. In order to perform the required formation and management activities systematically, support should be provided to partners of horizontal collaboration. However, collaboration projects also have significant failure rates due to their inherent complexity. One of the main barriers to horizontal logistics collaboration implementation is the lack of feasible collaboration mechanism, in particularly a gain-sharing mechanism. In this respect, providing a decision framework outlining the formation and management of horizontal alliances can be helpful.
In this context, the presented project proposes and tests a research model that investigates the following research questions:
1. Which alliances can be expected to be formed?
2. Which logistics concepts can be used to enable horizontal cooperation?
3. How should the cost savings be shared among the coalition partners?
4. How will the cooperating firms allocate their total cost/profit?
Due to competition and cooperation that exist among supply chain members, game theory is an essential tool in analyzing supply chain members behaviors and the interaction between them. Motivated by the above issues, the project aims to address these problems and fill up research gaps that currently exist in the area of supply chain management using a game theoretical approach.
