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Mitigating Hi-tech products risks due to rapid technological innovation

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  • Yang, P.C.
  • Wee, H.M.
  • Liu, B.S.
  • Fong, O.K.

Abstract

The risks on international trade have increased continuously in recent years. One such risk for Hi-tech products is the result of rapid technological innovation, which results in a significant decline in the component cost, the selling price and the demand (due to newer products introduction). The Hi-tech products include computers and communication consumer products. From a practical viewpoint, there is a need to develop an innovative replenishing policy to consider the impact of the risk. In this paper, an economic order quantity model with finite planning horizon is developed for a buyer, when the component cost, the selling price and the demand rate of the end-consumer decline at a continuous rate. A numerical example and sensitivity analysis for two case studies are carried out to illustrate this model.

Suggested Citation

  • Yang, P.C. & Wee, H.M. & Liu, B.S. & Fong, O.K., 2011. "Mitigating Hi-tech products risks due to rapid technological innovation," Omega, Elsevier, vol. 39(4), pages 456-463, August.
  • Handle: RePEc:eee:jomega:v:39:y:2011:i:4:p:456-463
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    References listed on IDEAS

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    Cited by:

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    2. Sarkar, Mitali & Sarkar, Biswajit, 2013. "An economic manufacturing quantity model with probabilistic deterioration in a production system," Economic Modelling, Elsevier, vol. 31(C), pages 245-252.
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    4. Wee, Hui Ming & Widyadana, Gede Agus, 2013. "A production model for deteriorating items with stochastic preventive maintenance time and rework process with FIFO rule," Omega, Elsevier, vol. 41(6), pages 941-954.
    5. Zhang, Juan & Gou, Qinglong & Liang, Liang & Huang, Zhimin, 2013. "Supply chain coordination through cooperative advertising with reference price effect," Omega, Elsevier, vol. 41(2), pages 345-353.
    6. Bob Walrave & A Georges L Romme & Kim E van Oorschot & Fred Langerak, 2017. "Managerial attention to exploitation versus exploration: toward a dynamic perspective on ambidexterity," Industrial and Corporate Change, Oxford University Press, vol. 26(6), pages 1145-1160.
    7. Sarkar, Biswajit & Saren, Sharmila & Wee, Hui-Ming, 2013. "An inventory model with variable demand, component cost and selling price for deteriorating items," Economic Modelling, Elsevier, vol. 30(C), pages 306-310.
    8. Sarkar, Biswajit & Guchhait, Rekha & Sarkar, Mitali & Cárdenas-Barrón, Leopoldo Eduardo, 2019. "How does an industry manage the optimum cash flow within a smart production system with the carbon footprint and carbon emission under logistics framework?," International Journal of Production Economics, Elsevier, vol. 213(C), pages 243-257.

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