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A system-optimization perspective for supply chain network integration: The horizontal merger case

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  • Nagurney, Anna

Abstract

In this paper, we present a new theoretical framework for the quantification of strategic advantages associated with horizontal mergers through the integration of supply chain networks. The framework is a system-optimization one in which each firm is represented as a network of economic activities associated with manufacturing, distribution, and storage and with explicit capacities imposed on the links. We present the models pre- and post-horizontal mergers and define a measure for the quantification of the gains, if any, associated with the mergers. We illustrate the framework with several numerical examples. For simple classes of mergers we derive formulae for the strategic advantages.

Suggested Citation

  • Nagurney, Anna, 2009. "A system-optimization perspective for supply chain network integration: The horizontal merger case," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 45(1), pages 1-15, January.
    • Handle: RePEc:eee:transe:v:45:y:2009:i:1:p:1-15
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    Citations

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    Cited by:

    1. Andreou, Panayiotis C. & Louca, Christodoulos & Panayides, Photis M., 2012. "Valuation effects of mergers and acquisitions in freight transportation," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 48(6), pages 1221-1234.
    2. Anna Nagurney & Amir Masoumi & Min Yu, 2012. "Supply chain network operations management of a blood banking system with cost and risk minimization," Computational Management Science, Springer, vol. 9(2), pages 205-231, May.
    3. Yuan, Zhennan & Chen, Frank Y. & Yan, Xiaoming & Yu, Yugang, 2020. "Operational implications of yield uncertainty in mergers and acquisitions," International Journal of Production Economics, Elsevier, vol. 219(C), pages 248-258.
    4. Dragicevic, Arnaud Z. & Barkaoui, Ahmed, 2017. "Forest-based industrial network: Case of the French timber market," Forest Policy and Economics, Elsevier, vol. 75(C), pages 23-33.
    5. Jahani, Hamed & Abbasi, Babak & Alavifard, Farzad & Talluri, Srinivas, 2018. "Supply chain network redesign with demand and price uncertainty," International Journal of Production Economics, Elsevier, vol. 205(C), pages 287-312.
    6. Xiaoge Zhang & Andrew Adamatzky & Felix T. S. Chan & Sankaran Mahadevan & Yong Deng, 2017. "Physarum solver: a bio-inspired method for sustainable supply chain network design problem," Annals of Operations Research, Springer, vol. 254(1), pages 533-552, July.
    7. Pavan Manocha & Jagjit Singh Srai, 2020. "Exploring Environmental Supply Chain Innovation in M&A," Sustainability, MDPI, vol. 12(23), pages 1-15, December.
    8. Masoumi, Amir H. & Yu, Min & Nagurney, Anna, 2017. "Mergers and acquisitions in blood banking systems: A supply chain network approach," International Journal of Production Economics, Elsevier, vol. 193(C), pages 406-421.
    9. Qiang, Patrick & Nagurney, Anna, 2012. "A bi-criteria indicator to assess supply chain network performance for critical needs under capacity and demand disruptions," Transportation Research Part A: Policy and Practice, Elsevier, vol. 46(5), pages 801-812.
    10. Soo-Haeng Cho, 2014. "Horizontal Mergers in Multitier Decentralized Supply Chains," Management Science, INFORMS, vol. 60(2), pages 356-379, February.
    11. Nagurney, Anna, 2021. "Optimization of supply chain networks with inclusion of labor: Applications to COVID-19 pandemic disruptions," International Journal of Production Economics, Elsevier, vol. 235(C).
    12. Soo-Haeng Cho & Xin Wang, 2017. "Newsvendor Mergers," Management Science, INFORMS, vol. 63(2), pages 298-316, February.
    13. Burcu B. Keskin & Halit Üster, 2012. "Production/distribution system design with inventory considerations," Naval Research Logistics (NRL), John Wiley & Sons, vol. 59(2), pages 172-195, March.
    14. Zhao, Lima & Huchzermeier, Arnd, 2015. "Operations–finance interface models: A literature review and framework," European Journal of Operational Research, Elsevier, vol. 244(3), pages 905-917.
    15. Paul Manuel & Helal Al-Hamadi & Kalim Qureshi, 2015. "Challenges, strategies and metrics for supply-driven enterprises," Annals of Operations Research, Springer, vol. 233(1), pages 293-303, October.
    16. Nagurney, Anna, 2010. "Optimal supply chain network design and redesign at minimal total cost and with demand satisfaction," International Journal of Production Economics, Elsevier, vol. 128(1), pages 200-208, November.
    17. Durowoju, Olatunde A. & Chan, Hing Kai & Wang, Xiaojun & Akenroye, Temidayo, 2021. "Supply chain redesign implications to information disruption impact," International Journal of Production Economics, Elsevier, vol. 232(C).

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