Analysis of the Market-Based Adjustable Outsourcing Contract under Uncertainties

• 成果类型: Article
• 署名作者: Feng, Baichun; Yao, Tao; Jiang, Bin
• 署名单位: University of Memphis; Pennsylvania Commonwealth System of Higher Education (PCSHE); Pennsylvania State University; Pennsylvania State University - University Park; DePaul University
• 刊物名称: PRODUCTION AND OPERATIONS MANAGEMENT
• ISSN/ISSBN: 1059-1478
• DOI: 10.1111/j.1937-5956.2012.01349.x
• 发表日期: 2013
• 页码: 178-188
• 关键词: cost; COORDINATION; COOPERATION; procurement; options

摘要

The market-based adjustable contract for customized goods or services has emerged in outsourcing practices. Its objective is to minimize the operational risks inherent in today's volatile environment of operations. Our research reveals several important properties of this contract through a continuous-time analytical approach. Specifically, we consider the determination of this contract between two risk-averse firms through a Nash bargaining process. We derive the optimal adjusting mechanism analytically and extensively analyze the application boundary of the market-based adjustable outsourcing contract. We conclude by discussing implications for practice and research.