scholarly journals Effects of channel encroachment on the software and service decisions in it supply chains

2021 ◽  
Vol 0 (0) ◽  
pp. 0
Author(s):  
Tinghai Ren ◽  
Nengmin Zeng ◽  
Dafei Wang ◽  
Shuwei Cheng
Keyword(s):  
Supply Chain ◽  
Service Quality ◽  
High Price ◽  
Software Developers ◽  
Sales Price ◽  
Software Developer ◽  
It Service ◽  
Extended Warranty ◽  
Service Supply Chain ◽  
Intensity Of Competition

<p style='text-indent:20px;'>Currently, many upstream software developers not only sell software through downstream service providers, but also directly sell it to clients. However, in the field of IT service supply chain management, there is a lack of research on the channel encroachment of software developers. In this study, we consider an IT service supply chain with a software developer, a service provider and client enterprises. Clients can either purchase the software (developed by the software developer) from the provider with a high price and additional pre-sale services, or directly purchase it from the developer with a low price but without pre-sale service. After purchasing the software, the clients can also purchase the extended warranty service from the developer. The study shows that the market size occupied by the developer and the intensity of competition between the two parties will neither affect the developer's product and service pricing decisions, nor influence the total demand for software products and extended warranty services, and thus will not impact his own profit. However, these factors will impact the provider's decisions for pre-sale service quality and software sales price, thereby affecting the provider's software demand and profit, and thus impact the performance of the supply chain. In addition, as the intensity of competition between both parties increases, the provider will simultaneously choose to reduce the pre-sales service quality and the software sales price to compete with the developer. Different from conclusions of the existing research on competition, we surprisingly observe that as the sensitivity of client enterprises to the extended warranty services price increases, both parties will increase the software price to compete. The encroachment of the developer will reduce the provider's software demand and profit, and thus lead to a decline in the performance of the supply chain. Therefore, the encroachment of the developer is an act of squeezing out partners by decreasing the profit of the provider, but without affecting his own profit.</p>

scholarly journals Effect of service quality on software sales and coordination mechanism in IT service supply chain

2021 ◽  
Vol 0 (0) ◽  
pp. 0
Author(s):  
Tinghai Ren ◽  
Kaifu Yuan ◽  
Dafei Wang ◽  
Nengmin Zeng
Keyword(s):  
Decision Making ◽  
Supply Chain ◽  
Service Provider ◽  
Sales Price ◽  
Software Developer ◽  
It Service ◽  
Service Supply Chain ◽  
Decentralized Decision Making ◽  
Total Profit

<p style='text-indent:20px;'>Currently, the upstream software developer usually cooperates with the downstream service provider to sell software and related services to client enterprises. Furthermore, the quality of pre-sale services provided by the provider has significant impact on software sales and on the performance of IT service supply chain (ITSSC). However, the existing research on IT service supply chain management (ITSSCM) lacks attention to this issue. In this study, we consider an ITSSC with a software developer, a service provider and client enterprises. Two scenarios are discussed in this study. Our study finds that the quality of pre-sale services provided by the provider and the price of extended warranty service (EWS) provided by the developer (in centralized decision-making (CDM)) are both higher than those in decentralized decision-making (DDM); when the sensitivity of clients to the software price is lower than a certain critical value, the software sales price (in CDM) is unexpectedly higher than that in DDM; however, when it is higher than the certain value, the software sales price (in CDM) is lower than that in DDM. Due to the double marginal effect between the developer and the provider, the total profit of ITSSC (in DDM) is always lower than that in CDM. By providing a combined coordination contract based on "guiding price <inline-formula><tex-math id="M1">\begin{document}$ + $\end{document}</tex-math></inline-formula> service cost sharing <inline-formula><tex-math id="M2">\begin{document}$ + $\end{document}</tex-math></inline-formula> product revenue sharing", not only the total profit of ITSSC can be increased, but also the profit of ITSSC members can be Pareto improved.</p>

scholarly journals Optimal Pricing Strategies in a Product and Service Supply Chain with Extended Warranty Service Competition considering Retailer Fairness Concern

2019 ◽  
Vol 2019 ◽  
pp. 1-15 ◽  
Author(s):  
Du Zhao ◽  
Xumei Zhang ◽  
Tinghai Ren ◽  
Hongyong Fu
Keyword(s):  
Supply Chain ◽  
Optimal Pricing ◽  
Pricing Strategies ◽  
Price Difference ◽  
Extended Warranty ◽  
Service Supply Chain ◽  
Reasonable Range ◽  
Fairness Concerns ◽  
Extended Warranties ◽  
Warranty Service

This paper examines optimal pricing in a two-tier product and service supply chain consisting of a manufacturer and a retailer in the context of vertical competition in extended warranty in two cases: one considering the retailer’s fairness concerns and one without considering the retailer’s fairness concerns. A manufacturer-dominated product and service supply chain game-theoretic model on the Stackelberg model is developed to analyse how the level of vertical competition in extended warranty service and the intensity of a retailer’s fairness concerns influence the optimal pricing of products and extended warranties for the manufacturer and retailer. This study finds the following: (i) Two parties of the supply chain employ differential pricing strategies for extended warranties when the retailer has fairness concerns. (ii) Compared to the same pricing strategies for extended warranty service when the retailer has no fairness concerns, the increase of competition intensity of vertical extended warranty service will enlarge the price difference of extended warranty service. Meanwhile, it is the intensity of fairness concerns that determines the influences of retailer’s fairness concerns on the price difference of extended warranties. (iii) If no fairness concerns are raised, an increase in the level of vertical competition in extended warranty service would benefit both supply chain parties, rather than hurting their profit. If the retailer is fair-minded, its fairness utility increases when the intensity of the fairness concerns rises in a reasonable range and decreases when the intensity exceeds the reasonable range, but for the manufacturer, its profits will be damaged as long as the retailer raises fairness concerns.

Pricing and Service Quality Guarantee Decisions in Logistics Service Supply Chain with Fairness Concern

2018 ◽  
Vol 35 (05) ◽  
pp. 1850036 ◽  
Author(s):  
Ni Du ◽  
Qinglan Han
Keyword(s):  
Supply Chain ◽  
Service Quality ◽  
Optimal Decision ◽  
Service Market ◽  
Joint Decision ◽  
Logistics Service ◽  
Basic Model ◽  
Service Supply Chain ◽  
Fairness Concern ◽  
Quality Guarantee

Although existing contributions that explore service quality guarantee problem of a logistic service supply chain (LSSC) consider fairness concern behavior of one member, little attention is paid to considering the combination of members’ fairness concern and the joint decision of pricing and service quality guarantee in LSSC. Therefore, it is necessary to research how different fairness concern affects the joint decision of pricing and service quality guarantee in an LSSC. First considering a price and quality-sensitive logistics service market, a basic model without fairness concern of a customized LSSC is established. Then, a new model with fairness concern of a decentralized LSSC is constructed based on the basic model. The optimal decision of the LSSC with fairness concern is investigated in three cases. In each case, we analyze the effect of fairness concern on the optimal decision, and the expected profits and utilities. Finally, some numerical studies are shown to verify our theoretical analyses and some managerial insights are given.

Quality effort decision in service supply chain with quality preference based on quantum game

2015 ◽  
Vol 26 (07) ◽  
pp. 1550073 ◽  
Author(s):  
Cuihua Zhang ◽  
Peng Xing ◽  
Jianwei Wang
Keyword(s):  
Supply Chain ◽  
Nash Equilibrium ◽  
Service Quality ◽  
Service Provider ◽  
Optimal Strategies ◽  
Quantum Game ◽  
Quality Cost ◽  
Numerical Examples ◽  
Service Supply Chain ◽  
Changing Trend

Service quality preference behaviors of both members are considered in service supply chain (SSC) including a service integrator and a service provider with stochastic demand. Through analysis of service quality cost and revenue, the utility functions are established on service quality effort degree and service quality preference level in integrated and decentralized SSC. Nash equilibrium and quantum game are used to optimize the models. By comparing the different solutions, the optimal strategies are obtained in SSC with quality preference. Then some numerical examples are studied and the changing trend of service quality effort is further analyzed by the influence of the entanglement operator and quality preferences.

scholarly journals Dynamic Contract Design of Product-Service Supply Chain considering Consumers’ Strategic Behavior and Service Quality

Complexity ◽  
2021 ◽  
Vol 2021 ◽  
pp. 1-25
Author(s):  
Dafei Wang ◽  
Tinghai Ren ◽  
Xueyan Zhou ◽  
Kaifu Yuan ◽  
Qingren He
Keyword(s):  
Supply Chain ◽  
Service Quality ◽  
Strategic Behavior ◽  
Market Competition ◽  
Rapid Development ◽  
Purchase Behavior ◽  
Service Supply Chain ◽  
Dynamic Contract ◽  
Product Service ◽  
Input Efficiency

With increasing market competition and rapid development of service economy, more and more enterprises are shifting from providing products or services to providing product-service systems (PSSs) that integrate products and services, in order to improve competitiveness and profitability. Meanwhile, consumers have strategic delayed purchasing behavior when purchasing the PSS and high requirements for service quality. This paper investigates the two-period pricing and service quality decisions of product-service supply chain (PSSC) considering consumers’ strategic behavior under decentralized and centralized scenarios. The equilibrium results are compared in two scenarios. In order to eliminate performance loss under the decentralized scenario, we design two-period dynamic contracts to coordinate the PSSC. Furthermore, numerical simulation is provided to verify the feasibility of the contracts. The following conclusions can be drawn: (1) the higher the service input-efficiency, the more beneficial for alleviating consumers’ strategic purchase behavior under two scenarios, but this mitigation effect is more obvious under the centralized scenario. (2) Compared with the centralized scenario, the service quality is lower, the two-period PSS sales prices are higher, and the two-period profit is lower under the decentralized scenario. The proportion of service valuation (accounts for the valuation of PSS) will promote the widening of the service quality gap under two scenarios, but in some cases, the service input-efficiency will weaken the promotion effect of the proportion of service valuation. (3) The design of the two-period combined contracts depends on the proportion of service valuation. When the proportion of service valuation is high, the “two-period revenue sharing + service-cost sharing” combined dynamic contract can achieve PSSC perfect coordination. However, when the proportion of service valuation is low, it is necessary to design complexity combined dynamic contract which can achieve PSSC perfect coordination.

Coordination mechanism of IT service supply chain: an economic perspective

2012 ◽  
Vol 22 (2) ◽  
pp. 95-103 ◽  
Author(s):  
Jianyuan Yan ◽  
Yanli Guo ◽  
Laurie Schatzberg
Keyword(s):  
Supply Chain ◽  
Coordination Mechanism ◽  
Economic Perspective ◽  
It Service ◽  
Service Supply Chain

The Third-Party E-Commerce Platform Based on the Trading Service

2014 ◽  
Vol 926-930 ◽  
pp. 4061-4064
Author(s):  
Tao Kuang ◽  
Wei Peng Dong
Keyword(s):  
Supply Chain ◽  
Price Elasticity ◽  
Formal Model ◽  
Supply And Demand ◽  
Third Party ◽  
High Price ◽  
The Third ◽  
Service Supply Chain ◽  
Transaction Process ◽  
Transaction Services

This paper presents a formal model of monopoly e-commerce platforms owned by a third party in spot trading modes using analyzing the transaction process and service supply chain relationship .for more benefits, the platform owner must aim at transaction services of staple commodities with high price elasticity and large quantities of market supply and demand, while reducing the marginal usage costs of buyers and suppliers with effective measures.

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