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In this paper, we introduce a novel auction-based decision support system to help a firm readily assemble supply chains. At this aim, we tackle the problem of deciding whether to outsource some production processes or not-the so-called make-or-buy decision problem. The solution to the make-or-buy decision problem is an optimal supply chain whose operations are either performed in-house or outsourced. We propose to employ a novel extension of combinatorial reverse auctions, the so-called Multiunit Combinatorial Reverse Auction with Transformability Relationships Among Goods, which allows the following: 1) a buyer/auctioneer to express transformability relationships among goods (some goods can be transformed into others at some transformation cost) and 2) bidders to express their preferences over bundles of goods.
Systems, Man and Cybernetics, Part A: Systems and Humans, IEEE Transactions on (Volume:40 , Issue: 4 )
Date of Publication: July 2010