Introducing quotation and negotiation structure in the order acceptance decision model*

Piya Sujan, Katsuhiko Takahashi, Katsumi Morikawa

Research output: Contribution to journalArticle

5 Citations (Scopus)

Abstract

In Make-to-Order (MTO) system the Order acceptance (OA) decision usually stems from the result of negotiation between the customer and the manufacturer. In such a system, the quotation submitted and the negotiation strategy adopted by the manufacturer play a major role in the decision processes. In practice, OA decision is often functionally separated with the quotation and negotiation. In this paper, fundamentally, we incorporate quotation and negotiation structure into OA decision model to control the workload in the system. We use the notion of robustness and negotiation margin to generate quotation of an order. While two different strategies, which vary from hostile to generous nature, are developed to negotiate with the customer. The strategy utilizes aspiration level, limit level and customer preferred line (CPL) to obtain new offer during the negotiation process. Numerical analysis is presented to illustrate the working mechanism of proposed method.

Original languageEnglish
Pages (from-to)293-318
Number of pages26
JournalInternational Journal of Operations and Quantitative Management
Volume15
Issue number4
Publication statusPublished - Dec 2009

Fingerprint

Numerical analysis
Decision model
Acceptance

Keywords

  • Make-to-order
  • Negotiation
  • OA decision
  • Quotation
  • Uncertainty

ASJC Scopus subject areas

  • Business and International Management
  • Strategy and Management
  • Management Science and Operations Research
  • Information Systems and Management
  • Management of Technology and Innovation

Cite this

Introducing quotation and negotiation structure in the order acceptance decision model* . / Sujan, Piya; Takahashi, Katsuhiko; Morikawa, Katsumi.

In: International Journal of Operations and Quantitative Management, Vol. 15, No. 4, 12.2009, p. 293-318.

Research output: Contribution to journalArticle

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