Managing Procurement and Production Outsourcing under Dynamic Prices

This paper proposes a procurement and production outsourcing model subject to a dynamic prices environment. Using the optimal control theory we obtain the necessary conditions of the optimal procurement and production policy. From the study of optimal control conditions, we derive qualitative proper...

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Bibliographic Details
Published in:Acta Mathematicae Applicatae Sinica 2013, Vol.29 (1), p.135-142
Main Authors: Cao, Xiao-gang, Yang, Chao, Wen, Hui, Xia, Huo-song, Li, Ji-zi
Format: Article
Language:English
Subjects:
Applications of Mathematics
Math Applications in Computer Science
Mathematical and Computational Physics
Mathematics
Mathematics and Statistics
Theoretical
价格管理
外包
定性性质
控制条件
最优控制理论
生产决策
示范性
采购
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Summary:This paper proposes a procurement and production outsourcing model subject to a dynamic prices environment. Using the optimal control theory we obtain the necessary conditions of the optimal procurement and production policy. From the study of optimal control conditions, we derive qualitative properties of the optimal procurement and production decisions for a few exemplifying cases. Through these results we are able to provide some managerial implications for managers to make real decisions.
ISSN:0168-9673
1618-3932
DOI:10.1007/s10255-013-0196-4