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Article
Publication date: 4 December 2023

Yanyan Zheng, Peng Liu, Yingxue Zhao and Zhichao Zhang

This paper examines how the level of low-carbon awareness (LCA) affects the remanufacturing strategy in a supply chain with an original equipment manufacturer (OEM) and an…

Abstract

Purpose

This paper examines how the level of low-carbon awareness (LCA) affects the remanufacturing strategy in a supply chain with an original equipment manufacturer (OEM) and an independent remanufacturer (IR) competing with each other.

Design/methodology/approach

Game theory and operations optimization.

Findings

The studies analytically characterize the threshold levels of the LCA in response to which the OEM and the IR will change their remanufacturing strategies from no remanufacturing to partial remanufacturing and then to full remanufacturing. In addition, the studies reveal that as compared with the OEM, the IR has more flexibility in terms of the market entry to remanufacturing with the level of LCA increasing. With the extended studies, it is exhibited that the above findings are robust to a good extent.

Originality/value

It can provide decision support for remanufacturing enterprises.

Details

Kybernetes, vol. ahead-of-print no. ahead-of-print
Type: Research Article
ISSN: 0368-492X

Keywords

Article
Publication date: 13 November 2023

Wen Zhang and Mingzhuo Dai

The purpose of this study is to explore the interplay between the selection of selling formats of remanufactured products for a third-party remanufacturer (TPR) and the quality…

Abstract

Purpose

The purpose of this study is to explore the interplay between the selection of selling formats of remanufactured products for a third-party remanufacturer (TPR) and the quality decision of an original equipment manufacturer (OEM).

Design/methodology/approach

This study considers a remanufacturing supply chain, where the OEM sells new products through a platform retailer, but the products remanufactured by the TPR can be sold via a direct or indirect channel. The authors model a Stackelberg game and explore the optimal quality decision of the OEM and selling format choice of the TPR.

Findings

The OEM's optimal decision depends mainly on consumers' discounted utility coefficient and cost-scale factor of remanufactured products. A higher consumers' valuation of the remanufactured product will not result in a higher retail price, but may lead to an increase in new product's sales. Given the cost-scale factor, the TPR prefers to sell directly no matter what the value of consumers' discounted utility coefficient is. An all-win situation is achieved with selling directly when consumers' discounted utility coefficient is sufficiently large.

Practical implications

These results provide some support to the operational strategies of the OEM and TPR.

Originality/value

This study firstly endogenizes the quality decision and combines the selling format selection of the TPR and the quality decision of the OEM to explore the interplay between these two important decisions.

Details

Kybernetes, vol. ahead-of-print no. ahead-of-print
Type: Research Article
ISSN: 0368-492X

Keywords

Article
Publication date: 14 November 2023

Fan Ding, Zhangping Lu and Jingxian Chen

Contract Manufacturers (CM, factory) can cultivate factory brand products by imitating Original Equipment Manufacturers' (OEM, brand owner) National Brand products, and compete…

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Abstract

Purpose

Contract Manufacturers (CM, factory) can cultivate factory brand products by imitating Original Equipment Manufacturers' (OEM, brand owner) National Brand products, and compete with OEM through the online retailer, that is, factory encroachment. In practice, few consumers can identify the quality of those two products in the online market. Implementing blockchain technology (BTI) can help all consumers identify product quality but may change the operation decisions and incur implementation costs. This study aims to explore how will the BTI strategies affect participants' operation performance under the factory encroachment and delve into the decisions regarding NB product quality and CM encroachment.

Design/methodology/approach

This study constructs a three-level outsourcing supply chain comprising one contract manufacturer (CM, factory), one original equipment manufacturer (OEM) and one online retailer. By utilizing the Stackelberg game, the authors first compared the results between two strategic decisions of BTI and no-BTI by online retailers under the factory encroachment scenario. Then, the NB product quality decision and the CM's encroachment decision are also investigated.

Findings

BTI strategy can benefit all participants (triple win), which both occurs in exogenous and endogenous quality cases, and the triple win area will expand (shrink) as the BTI cost decreases (increases). In addition, the OEM will improve product quality to confront competition from the CM, and the OEM may not always benefit from the BTI, it depends on the maturity of the market. Interestingly, BTI could improve the consumer surplus when the proportion of novice consumers is low. Finally, this study also investigates the extended case that CM always encroaches into the market whether the online retailer choose BTI or not, which hurts OEM's profit and decreases the product quality.

Originality/value

This study sheds light on the strategic decisions of online retailers' BTI regarding supply chain members' profits, consumer surplus and social welfare under factory encroachment. It also demonstrates that the BTI strategy, under different quality decisions (endogenous and exogenous), can be more profitable for chain members and consumers.

Details

Kybernetes, vol. ahead-of-print no. ahead-of-print
Type: Research Article
ISSN: 0368-492X

Keywords

Article
Publication date: 6 September 2022

Bohai Liu, Qi Song, Handong Zheng, Yaoyao Ma and Kai Li

In this paper, the authors aim to study the optimal strategy of original equipment manufacturers (OEMs) considering both consumer segmentation and upward substitution of…

Abstract

Purpose

In this paper, the authors aim to study the optimal strategy of original equipment manufacturers (OEMs) considering both consumer segmentation and upward substitution of remanufactured products in the product life cycle.

Design/methodology/approach

In this paper, the authors develop two remanufacturing models: the OEM remanufacturing model and the authorized remanufacturing model. Then, the authors study the impact of both green consumers' scale and the product life cycle expressed as the market growth rate on the OEM's optimal decision-making. Therefore, the authors derive the optimal solutions of the two models by using game theory.

Findings

The authors find that in the case of low market growth rate, when there only exist ordinary consumers, if the substitutability of remanufactured products produced by the OEM is below one threshold or above another threshold, the OEM can obtain higher profit in the OEM remanufacturing model, and vice versa. If the substitutability of remanufactured products produced by the OEM is below a threshold when there are both ordinary and green consumers, the OEM prefers the authorized remanufacturing model; and vice versa. Moreover, in the case of high market growth rate, the OEM prefers the OEM remanufacturing model only when the substitution-level in OEM remanufacturing model is above a threshold.

Originality/value

The present study fills the gap in existing researches by simultaneously discussing product life cycle and green consumers' scale. The authors provide manufacturers with a new basis for remanufacturing decisions.

Details

Industrial Management & Data Systems, vol. 123 no. 4
Type: Research Article
ISSN: 0263-5577

Keywords

Article
Publication date: 7 November 2022

Bangyi Li, Juan Tang, Zhi Liu and Bengang Gong

The purpose of this paper is to investigate remanufacturing operational strategies considering uncertain quality of end-of-life (EOL) products and differential consumers’…

Abstract

Purpose

The purpose of this paper is to investigate remanufacturing operational strategies considering uncertain quality of end-of-life (EOL) products and differential consumers’ willingness-to-pay (WTP) for new products and provide suggestions on the remanufacturing mode selection for the original equipment manufacturer (OEM).

Design/methodology/approach

This study considers three remanufacturing modes, i.e. in-house, outsourcing and authorization modes. By establishing and comparing decision models of three modes from the perspectives of profit, consumer surplus and environment, the optimal remanufacturing mode is discussed.

Findings

The results suggest that if the OEM’s remanufacturing capability is high, the in-house mode brings to the highest environmental performance, OEM’s profit and consumer surplus. Otherwise, the outsourcing mode (authorization) is the best benefit to environment (consumers if the unit production cost of new products is not too high). As for the preference of two decision-makers to outsourcing and authorization modes, if the difference of consumers’ WTP for new products is low, the OEM prefers the outsourcing mode; otherwise, the OEM prefers the authorization mode. The preference of the third-party remanufacturer (TPR) to remanufacturing mode is affected by consumers’ WTP for remanufactured products, WTP difference for new products and remanufacturing quality level standard.

Practical implications

These results can provide operational insights into how to select remanufacturing mode when the quality of EOL products is uncertain and consumers’ WTP for new products is different under three remanufacturing modes.

Originality/value

This paper is among the first to investigate the joint effects of EOL products’ uncertain quality and differential consumers’ WTP for new products on the operational strategies and performance under different remanufacturing modes.

Details

Kybernetes, vol. 53 no. 1
Type: Research Article
ISSN: 0368-492X

Keywords

Article
Publication date: 7 September 2022

Fei Yan, Hong-Zhuan Chen and Zhichao Zhang

Industry practice has shown that technology licensing has an important effect on the R&D cooperation between firms. Different licensing methods will significantly impact a supply…

Abstract

Purpose

Industry practice has shown that technology licensing has an important effect on the R&D cooperation between firms. Different licensing methods will significantly impact a supply chain member's cooperative and price R&D decisions. However, there is scant literature investigating the decision on technology licensing and its impact on a supply chain member's price and cooperative R&D decisions. To address this gap, the authors investigate the R&D cooperation and the technology licensing in a supply chain formed of an original equipment manufacturer (OEM), a contract manufacturer (CM), and a third-party manufacturer which will compete with the OEM when the technology licensing occurs.

Design/methodology/approach

The authors investigate two licensing patterns, royalty licensing, fixed fee licensing together with the no licensing, within the R&D cooperative supply chain by developing two three-stage and a two-stage Stackelberg models.

Findings

Compare to the no licensing strategy, technology licensing always benefits to the OEM and the society especially when the technology efficiency and the brand power of the third-party manufacturer are more significant; the royalty licensing benefits to the OEM more when the technology efficiency and the brand power of the third-party manufacturer are higher; the fixed fee licensing benefits to the OEM more when the technology efficiency and the brand power of the third-party manufacturer are lower.

Practical implications

The royalty licensing is more effective for mitigating price competition intensity and helping firms to maintain higher sales margins; the fixed fee licensing induces firms' lower sales margins but increases the firms' sales quantities; in most cases, the fixed fee licensing is optimal from the perspectives of consumer and society, however, the CM's investment intention to the R&D technology with the fixed fee licensing is lower.

Originality/value

So far, different licensing models under the R&D cooperation have not been investigated, and the authors propose two three-stage Stackelberg models with considering the competition caused by technology licensing under the R&D cooperation to deal with the cooperative R&D and technology licensing issues.

Details

Kybernetes, vol. 52 no. 12
Type: Research Article
ISSN: 0368-492X

Keywords

Article
Publication date: 8 August 2022

Lena L. Kronemeyer, Herbert Kotzab and Martin G. Moehrle

The purpose of this paper is the development of a patent-based supplier portfolio that can be used to evaluate and select suppliers on account of their technological competencies.

Abstract

Purpose

The purpose of this paper is the development of a patent-based supplier portfolio that can be used to evaluate and select suppliers on account of their technological competencies.

Design/methodology/approach

In addition to traditional approaches, the authors develop a supplier portfolio that characterizes suppliers according to the similarity between supplier's and OEM's technological competencies as well as their technological broadness. These variables are measured on the basis of patents, which constitute a valuable source of information in technology-driven industries. Contrary to existing binary measurement approaches, the authors’ portfolio uses semantic analyses to make use of the specific information provided in the patents' texts. The authors test this method in the field of gearings, which is a key driver for the automotive industry.

Findings

The authors identify six generic positions, characterizing specific risks for an OEM to become either technologically dependent or dependent on suppliers' production capacities. For each position the authors develop specific management strategies in face of the aforementioned risks. The approach helps OEMs navigate in the competitive landscape based on the most recent and publicly available information medium.

Originality/value

This work explicitly applies the construct of technological competencies to supplier evaluation and selection on the basis of portfolio approaches. Furthermore, the authors improve the use of patents for supplier evaluation in two respects: First, the authors analyze OEMs and upstream suppliers on an organizational level. Second, the authors utilize advanced semantic analysis to generate variables for the measurement of the criteria mentioned above.

Details

International Journal of Operations & Production Management, vol. 42 no. 11
Type: Research Article
ISSN: 0144-3577

Keywords

Article
Publication date: 5 September 2016

Dezhi Chen, William Wei, Daiping Hu and Etayankara Muralidharan

Although there have been many discussions on the status and development of original equipment manufacturers (OEMs), theory on how they survive is minimal. Little is known about…

2306

Abstract

Purpose

Although there have been many discussions on the status and development of original equipment manufacturers (OEMs), theory on how they survive is minimal. Little is known about how OEMs survive and upgrade to other business models, such as original design manufacturers (ODMs) and original brand manufacturers (OBMs), in emerging economies. The purpose of this paper is to extend the theory on the survival path of OEMs from the perspective of emerging countries by examining how OEMs survive cost pressures and upgrade to ODMs or OBMs.

Design/methodology/approach

Using a multi-case study method, this study analyzes the survival path employed by OEMs by examining eight firms in the Chinese toy industry.

Findings

This study shows that OEMs remain weak in the global toy industry chain due to labor costs. While some OEMs move to low-cost regions, others turn to OBM management, after transitioning through an ODM model, by investing in research and development and marketing.

Originality/value

This study explores the survival paths of OEM enterprises, showing that OEMs can first upgrade to ODMs and then to OBMs, or they can directly upgrade to OBMs. Shifting from OEM to ODM is an important step in the transition process, although the contract that OEMs have with their foreign partners does not change significantly.

Details

International Journal of Operations & Production Management, vol. 36 no. 9
Type: Research Article
ISSN: 0144-3577

Keywords

Article
Publication date: 5 October 2015

Prashant M. Ambad and Makarand S. Kulkarni

– The purpose of this paper is to propose a warranty-based bilateral automated multi-issue negotiation approach.

Abstract

Purpose

The purpose of this paper is to propose a warranty-based bilateral automated multi-issue negotiation approach.

Design/methodology/approach

A methodology for bilateral automated negotiation process is developed considering the targets such as warranty attractiveness, warranty cost, mean time between failures, spare parts cost to the end user over the useful life of the life. The negotiation methodology is explained using different cases of negotiation. The optimization for each negotiation step is carried out using genetic algorithm with elitism strategy.

Findings

The result after optimization indicates that the desired target values are achieved and manufacturer obtained desired profit margin.

Practical implications

Application of automated negotiation model is illustrated using a real life case of an automobile engine manufacturer. The proposed approach helps the manufacturer of any product to develop a methodology for carrying out the negotiation process. The approach also results into taking warranty-related decisions at the design stage.

Originality/value

This paper contributes in proposing a generalized methodology for warranty-based negotiation in which the negotiation is carried out between the manufacturer and the customer.

Details

Benchmarking: An International Journal, vol. 22 no. 7
Type: Research Article
ISSN: 1463-5771

Keywords

Article
Publication date: 13 June 2008

John W. Henke, Ravi Parameswaran and R. Mohan Pisharodi

Manufacturer price reduction pressure on suppliers is an important contributor to helping a manufacturer maintain a strong competitive position by keeping costs low. The benefits…

2451

Abstract

Purpose

Manufacturer price reduction pressure on suppliers is an important contributor to helping a manufacturer maintain a strong competitive position by keeping costs low. The benefits of trusting supplier working relations also help strengthen a manufacturer's competitive position. The purpose of this paper is to determine if manufacturer price reduction pressure and trusting working relations with the pressured suppliers, typically considered to be mutually exclusive, can co‐exist.

Design/methodology/approach

A structural equation modeling approach was used to analyze data covering 946 production buying situations involving 279 suppliers and six NA automotive OEMs.

Findings

Manufacturer price reduction pressure and trusting working relations with the pressured suppliers, are not mutually exclusive, they can co‐exist.

Research limitations/implications

The research found that it is not the pressure that impacts the manufacturer – supplier relations, but rather it is the manner by which the manufacturer goes about pressuring its suppliers that impacts its supplier working relations. The research, however, does not directly address how a manufacturer can achieve both ends simultaneously.

Practical implications

Manufacturers no longer have to choose between exerting price reduction pressures on suppliers or working to achieve trusting relations with suppliers. They can successfully do both. At the same time, suppliers must recognize that these conditions may occur and when applied simultaneously ultimately benefit both parties.

Originality/value

This research adds to the critically under‐researched B2B pricing processes and pricing impact areas, while helping to influence managerial actions, an area in which academic B2B research is considered to be lacking.

Details

Journal of Business & Industrial Marketing, vol. 23 no. 5
Type: Research Article
ISSN: 0885-8624

Keywords

1 – 10 of over 4000