Title
Simulation of learning in supply partnerships Simulation of learning in supply partnerships
Author
Faculty/Department
Faculty of Applied Economics
Publication type
article
Publication
,
Subject
Economics
Source (journal)
Computational and mathematical organization theory. - Place of publication unknown
Volume/pages
3(1997) :1 , p. 43-66
ISSN
1381-298X
Carrier
E
Target language
English (eng)
Affiliation
University of Antwerp
Abstract
A model is designed and used to simulate how partners in a supply relationship identify and reach a common target in the form of an ideal end product. They cooperate fully and share returns. They learn by interaction, as follows. From their different perspectives, they complement each others identification of the target. They adapt their productive competencies to the target, in order to conform to demand (quality), and to each other, in order to achieve efficient complementarity in production (efficiency). As they approach the target, their accuracy of identifying the target increases. Also, their speed of adaptation increases, and thus they can be said to be learning by doing. The model allows two different patterns of acceleration: a routine and a radical type of development. At some distance from the target they start to produce. A longer distance from the target yields earlier returns, but also entails a greater compromise on quality and thereby yields lower returns. Unpredictable changes in market and technology yield random shifts of the target. In the analysis, the returns from single and dual sourcing are compared under different parameter settings. The simulations show that in line with expectations dual sourcing can be more advantageous if development is of the radical type. However, the advantage only arises if conditions of market and technology are neither too volatile nor too stable
Handle