Supply Chains Through Many-to-Supply Chains Through Many-to-many Negotiationmany Negotiation

Jung-Ching (Wado) ChenJung-Ching (Wado) Chen

Supervised bySupervised by

Nicolas Gold, Paul LayzellNicolas Gold, Paul Layzell

DateDate

1616thth Septermber 2004 Septermber 2004

Content of presentationContent of presentation

Research backgroundResearch background Research problemsResearch problems Proposed solution to the problemsProposed solution to the problems ImplementationImplementation Thoughts on current progressThoughts on current progress

Research BackgroundResearch Background

In Software As A Service (SaaS), In Software As A Service (SaaS), Buying software services will be agent-based and negotiation-iBuying software services will be agent-based and negotiation-i

ntensiventensive End services will be composed by fine-grained component servEnd services will be composed by fine-grained component serv

ices.ices. A service providers will source component services from other A service providers will source component services from other

providers.providers. Negotiations will be multi-issue based and need to be completeNegotiations will be multi-issue based and need to be complete

d rapidly.d rapidly.

The above points lead to two key points: The above points lead to two key points: Supply chains of software services have to be efficientSupply chains of software services have to be efficient Negotiations on supply chain need to be automatic and rapid Negotiations on supply chain need to be automatic and rapid

Research ProblemResearch Problem

Inefficiency of supply chain are largely due to --Inefficiency of supply chain are largely due to -- Members on a supply chain try to maximise their own benefitsMembers on a supply chain try to maximise their own benefits But such gains of maximisation usually at expenses of other mBut such gains of maximisation usually at expenses of other m

embersembers And at the expense of the whole supply chain performanceAnd at the expense of the whole supply chain performance

Suboptimal problem is because of ‘lack of visibility’ acroSuboptimal problem is because of ‘lack of visibility’ across tiers in a given chainss tiers in a given chain

Power play in negotiations may end in zero-sum game, Power play in negotiations may end in zero-sum game, causedcaused Unsatisfied buyers/suppliers on supply chainsUnsatisfied buyers/suppliers on supply chains Online markets lose members due to dissatisfaction Online markets lose members due to dissatisfaction

A Self-sustainable marketplace must keep buyers/sellerA Self-sustainable marketplace must keep buyers/sellers happy with negotiation resultss happy with negotiation results

Proposed SolutionProposed Solution

Solution to visibility problem – introduce MediatorSolution to visibility problem – introduce Mediator Trustworthy third-party as Mediator toTrustworthy third-party as Mediator to

Collect negotiation data ‘across’ tiers in a supply chainCollect negotiation data ‘across’ tiers in a supply chain Mediate negotiation according to requestor’s preferencesMediate negotiation according to requestor’s preferences

Mediator

Proposed Solution (cont’d)Proposed Solution (cont’d)

To improve negotiation results on a supply chain – range-To improve negotiation results on a supply chain – range-based negotiationbased negotiation

A supply chain can be seen as a “chain of ranges”A supply chain can be seen as a “chain of ranges” Mediator collect all ranges on the chain and tweak them in Mediator collect all ranges on the chain and tweak them in

order to improve performance on certain criteriaorder to improve performance on certain criteria

Service B-1Service B

Service B-2

Final-Service

Service A

Service A-2

Service A-1

Total time T

Service B-1Service B

Service B-2

Service B-1Service B

Service B-2 Squeeze

Shorter time T’

ImplementationImplementation

The model is built on Jadex --The model is built on Jadex -- a java-based, FIPA-compliant agent platforma java-based, FIPA-compliant agent platform in which agents are goal-oriented and follow plans and beliefsin which agents are goal-oriented and follow plans and beliefs Compatibility with JADE library, XML-based scripting for agent pCompatibility with JADE library, XML-based scripting for agent p

rofilingrofiling

Negotiation Process in the ModelNegotiation Process in the Model

Three roles in the model: Buyer, Seller, and MediatorThree roles in the model: Buyer, Seller, and Mediator 3-stage negotiation in the mode:3-stage negotiation in the mode:

(1) (1) Preliminary negotiation:Preliminary negotiation: Buyer/Seller (B/S) negotiate Overa Buyer/Seller (B/S) negotiate Overall Range and Range of Offering, once agreedll Range and Range of Offering, once agreed

(2) (2) Formal negotiationFormal negotiation: B/S proceed to negotiate Mutual Agree: B/S proceed to negotiate Mutual Agreed Ranged Range

(3) (3) Collect then optimiseCollect then optimise: B/S submit neg’n results and prefere: B/S submit neg’n results and preferences to Mediator and wait for reply. nces to Mediator and wait for reply.

Mediator tweak submitted Ranges to improve the whole supply Mediator tweak submitted Ranges to improve the whole supply chain while trying to keep variances from B/S’s preferences to chain while trying to keep variances from B/S’s preferences to minimumminimum

Finally, Mediator returns optimisation results to all B/SFinally, Mediator returns optimisation results to all B/S

Current ProgressCurrent Progress

A preliminary model that follows the neg’n process has A preliminary model that follows the neg’n process has been built on Jadexbeen built on Jadex

Missing piece – What is the supposed algorithms for MMissing piece – What is the supposed algorithms for Mediator to optimise negotiations?ediator to optimise negotiations? Should be able to handle mass number of ranges and preferenShould be able to handle mass number of ranges and preferen

cesces Heuristic approach or genetic algorithm approachHeuristic approach or genetic algorithm approach Mediator’s knowledge (e.g. scoping proper number of echelonMediator’s knowledge (e.g. scoping proper number of echelon

s or B/Ss)s or B/Ss)

Any question?Any question?