Operational Coordination to Realize a Flexible Semiconductor Supply Network

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In this research project, we investigate the horizontal capacity coordination between IDM (Integrated Device Manufacturer) and foundry in the semiconductor industry. It is to enhance the flexibility of supply chain, which is necessary to deal with demand uncertainties. Applying the game theory, we show how well a typical contract used in practice performs from the view point of supply chain optimization. In addition, we discuss the necessity of such horizontal coordination to alleviate the effect of supply chain disruptions such as the one caused by the 2011 Tohoku Earthquake.