Coopetitive Supply Chain Relationship Model: Application to the Smartphone Manufacturing Network.

Abstract

Previous researches for understanding supply chain relationship have mostly focused on its vertical collaboration between buyers and suppliers. However, there have been some instances of volatile and stable collaborative relationships amongst competitors such as Apple-Samsung product manufacturer-component supplier relationship and airline alliances, respectively, which is recognized as coopetition. Even though there have been several qualitative studies and a number of game theory models on coopetition, it is rare to find any attempts on quantitative characterization of such coopetitive dynamic behavior in supply chain relationship. Hence, in this work, we formulated a MINLP model mathematically representing coopetitive relationships in a cost efficient supply chain network. In particular, the coopetition factor was newly introduced to measure the degree of coopetition among supply chain players and determine the optimal level of coopetition to engage in. The utility and practicality of the model were strongly demonstrated using a case study of a hypothetical smartphone supply chain network under different scenarios, thus proposing their strategically viable optimal interactions. Therefore, this exploratory study can herald a new era of global coopetitive business.