Traceability Technology Adoption in Supply Chain Networks
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INFORMATION SYSTEMS AND OPERATIONS MANAGEMENT
Speaker : Philippe Blaettchen
Ph.D. Candidate in the Technology & Operations Management area at INSEAD
Abstract :
Modern traceability technologies promise to improve supply chain management by simplifying recall procedures, increasing demand visibility, and ascertaining sustainable supplier practices. Managers in the dozens of traceability initiatives developing such technologies face a difficult question: which companies should they target as early adopters to ensure that their technology is broadly employed? To answer this question, managers must consider an extended supply chain effect that is inherent to traceability technologies. Namely, the benefits obtained from traceability are conditional on technology adoption throughout a product's supply chain. This effect, together with the fact that supply chains are interlinked in complex networks, makes the problem of choosing early adopters complex and difficult to solve. We address the problem of selecting the smallest set of early adopters by constructing a model of the dynamics of traceability technology adoption in supply chain networks. Similar to extant diffusion models, our model specifies new adopters based on past adopters. Unlike other models, however, it incorporates extended supply chain effects. We show that the problem is NP-hard and that no useful approximation guarantees can be obtained for any polynomial-time algorithm. Nevertheless, we introduce a procedure that identifies an exact solution in polynomial time under certain parameterizations of the network structure. We provide evidence that our procedure is tractable for real-world supply chain networks. Our results further provide insights into the relationship between network structures and the optimal set of firms to target. In particular, they suggest that small, isolated firms may be favored over large, highly connected ones.
Bio :
“In my research, I investigate how new business models, enabled by emerging technologies, can help answer pressing societal questions while allowing organizations to remain competitive. Sharing, for example, uses new technologies to overcome inefficiencies in resource utilization but may threaten manufacturers. I analyze how a manufacturer’s business model can optimally incorporate sharing platforms. After-sales services turn out to play a critical role in the business model’s effectiveness and the ability to prevent the adverse entry of third-party platforms, implying an essential future role of sharing in industries beyond consumer goods. We are looking forward to seeing you connected.”