On the Business Models of Cloud-based Modelling and Simulation for Decision Support

Simulation modelling is one of the techniques used for decision support in a wide range of domains and cloud computing is beginning to make some impact on simulation modelling by enabling ubiquitous, convenient and on-demand access to a variety of computing services. The cloud-based modelling and simulation (CBMS) literature has focused on how to develop CBMS tools using existing technologies. While this technical aspect is important, understanding the business aspect of CBMS is instrumental for its adoption by users and for ensuring the sustainability of the broader CBMS service supply chain. This paper presents a review of the business models adopted by vendors that provide Web or mobile applications for simulation modelling. An analysis of the offerings of these vendors provides some insights into how cloud services can be provided and used as part of CBMS business models. The study is conducted by reviewing the websites of simulation vendors. This study fills a gap in the literature on the business aspect of CBMS by providing insights into CBMS business model patterns. It highlights the importance of developing innovative business models that can help generate new market opportunities and revenue streams along the CBMS service supply chain. It also stresses the role of contracting in addressing the reported challenges and risks underpinning the provision and use of CBMS services

Who’s to blame or praise?:performance attribution challenges in outsourced service provision in supply chains

Purpose The aim of this paper is to understand the antecedents and effects of performance attribution challenges arising in the provision of business-to-business (B2B) services in supply chains. Design/methodology/approach The study draws on three in-depth case studies of logistics service providers (LSPs) offering supply chain solutions to their clients in Sweden. The analysis of performance attribution challenges and their antecedents and effects is based on 38 semi-structured interviews and review of 43 documents, including contracts and performance monitoring records. Findings Three key antecedents of performance attribution challenges are stressed. Two of these, the inseparability and contestability of service inputs, are closely related to the notion of service co-production. The third antecedent is the limited provider capability in performance data collection and analysis. Performance attribution challenges may result in provider aversion to performance-related risk and have a harmful effect on client relationships, for example, in terms of provider perceptions of opportunism and unfair allocation of gains. These effects can be mitigated through contracting, interventions in performance measurement system design and deployment of relational mechanisms. Research limitations/implications The paper extends the service management literature that emphasises on service co-production by suggesting that inputs of the client firm and its supply chain partners may not only vary in quality but also can be inseparable from provider inputs and highly contestable. It also empirically demonstrates how performance attribution challenges and their antecedents and effects manifest themselves in B2B service provision, as opposed to supply chain settings where the main user of logistics services is the consumer. Practical implications LSP managers should contract for performance based on high-quality and incontestable external inputs they rely upon. Contractual specifications (performance indicators and related incentives) should explicate and consider the inputs required by clients and their supply chain partners to minimise their contestability. Originality/value The study proposes an empirically based framework of the antecedents and effects of performance attribution challenges, an issue that has received scant attention in logistics outsourcing research and the business services literature more broadly

On the Business Models of Cloud-based Modelling and Simulation for Decision Support

Simulation modelling is one of the techniques used for decision support in a wide range of domains and cloud computing is beginning to make some impact on simulation modelling by enabling ubiquitous, convenient and on-demand access to a variety of computing services. The cloud-based modelling and simulation (CBMS) literature has focused on how to develop CBMS tools using existing technologies. While this technical aspect is important, understanding the business aspect of CBMS is instrumental for its adoption by users and for ensuring the sustainability of the broader CBMS service supply chain. This paper presents a review of the business models adopted by vendors that provide Web or mobile applications for simulation modelling. An analysis of the offerings of these vendors provides some insights into how cloud services can be provided and used as part of CBMS business models. The study is conducted by reviewing the websites of simulation vendors. This study fills a gap in the literature on the business aspect of CBMS by providing insights into CBMS business model patterns. It highlights the importance of developing innovative business models that can help generate new market opportunities and revenue streams along the CBMS service supply chain. It also stresses the role of contracting in addressing the reported challenges and risks underpinning the provision and use of CBMS services

Contract functions in service exchange governance:evidence from logistics outsourcing

The logistics outsourcing literature emphasises relational governance mechanisms and has underplayed the role of formal contractual provisions. This paper empirically examines the multiple functions that contracts perform in the governance of service exchanges. Codification, safeguarding, coordination and adaptation functions are linked to contract specification schedules, payment mechanisms, (early) termination rights, performance review and communication provisions, service variations clauses and renegotiation provisions. Contracts may also embody exchange- or partner-specific learning, albeit to a limited extent. Overall, the empirical findings lend support to the functional view of contracting. The functionality of contracts extends beyond safeguarding against opportunism and financial losses. In addition to offering economic and legal safeguards, contracts are used to coordinate and adapt service exchanges in the face of complexity and uncertainty

Coordination in service supply networks:insights from “Airport Collaborative Decision Making”

We examine the relationship between governance (alignment of interests) and coordination (alignment of actions), of mutually-dependent organisations in extended service networks. Research on governance has explored the interplay of contractual and relational mechanisms, mainly in dyads. In service operations management, interaction between provider and customer is understood as ‘co-production of value’. We examine the link between the two, and how coordination is achieved among several closelyinterdependent organisations on a single site. ‘Collaborative Decision-Making’ practices in airport operations provides the setting for the study, and we propose an initial framework to explain the role of information sharing and coordination mechanisms

Effects of public procurement of R&D on the innovation process:Evidence from the UK Small Business Research Initiative

PurposeThe study aims to investigate how pre-commercial procurement (PCP) influences the activities, capabilities and behaviours of actors participating in the innovation process. Unlike much of PCP research underpinned by a market failure theoretical framework that evaluates the additionality of innovation inputs and outputs, this paper focusses on the role and capacity of PCP in addressing systemic failures impeding the process of innovation. Design/methodology/approachPCP effects on the innovation process were studied through a qualitative study of the UK small business research initiative (SBRI) programme. Data collection comprised 33 semi-structured interviews with key informants within 30 organisations and analysis of 80-plus secondary data sources. Interviewees included executives of technology-based small businesses, managers within public buying organisations and innovation policymakers and experts. FindingsThe UK SBRI improves connectivity and instigates research and development (R&D) related interactions and cooperation. Through securing government R&D contracts, small firms access relevant innovation ecosystems, build up their knowledge and capabilities and explore possible routes to market. Public organisations use the SBRI to connect to innovative small firms and access their sets of expertise and novel ideas. They also learn to appreciate the strategic role of procurement. Nonetheless, SBRI-funded small business face commercialisation and innovation adoption challenges because of institutional constraints pertaining to rules, regulations and public-sector norms of conduct. Research limitations/implicationsThe study contributes to existing PCP research by demonstrating innovation process-related effects of PCP policies. It also complements literature on small business-friendly public procurement measures by highlighting the ways through which PCP, rather than commercial procurement procedures, can support the development of small businesses other than just facilitating their access to government (R&D) contracts.Social implicationsThe study identifies several challenge areas that policymakers should address to improve the implementation of the UK SBRI programme. Originality/valueThe study demonstrates the effects of PCP on the activities, capabilities and behaviours of small businesses and public buying organisations involved in the innovation process

Reverse resource exchanges in service supply chains:the case of returnable transport packaging

Purpose: The purpose of this paper is to understand how reverse resource exchanges and resource dependencies are managed in the service supply chain (SSC) of returnable transport packaging (RTP). Design/methodology/approach: A single case study was conducted in the context of automotive logistics focusing on the RTP SSC. Data were collected through 16 interviews, primarily with managers of a logistics service provider (LSP) and document analysis of contractual agreements with key customers of the packaging service. Findings: Resource dependencies among actors in the SSC result from the importance of the RTP for the customer’s production processes, the competition among users for RTP and the negative implications of the temporary unavailability of RTP for customers and the LSP (in terms of service performance). Amongst other things, the LSP is dependent on its customers and third-party users (e.g. the customer’s suppliers) for the timely return of package resources. The role of inter-firm integration and collaboration, formal contracts as well as customers’ power and influence over third-party RTP users are stressed as key mechanisms for managing LSP’s resource dependencies. Research limitations/implications: A resource dependence theory (RDT) lens is used to analyse how reverse resource exchanges and associated resource dependencies in SSCs are managed, thus complementing the existing SSC literature emphasising the bi-directionality of resource flows. The study also extends the recent SSC literature stressing the role of contracting by empirically demonstrating how formal contracts can be mobilised to explicate resource dependencies and to specify, and regulate, reverse exchanges in the SSC. Practical implications: The research suggests that logistics providers can effectively manage their resource dependencies and regulate reverse exchanges in the SSC by deploying contractual governance mechanisms and leveraging their customers’ influence over third-party RTP users. Originality/value: The study is novel in its application of RDT, which enhances our understanding of the management of reverse exchanges and resource dependencies in SSCs

Supply chain alignment as process:Contracting, learning and pay-for-performance

Purpose The purpose of this paper is to understand how buyers and suppliers in supply chains learn to align their performance objectives and incentives through contracting. Design/methodology/approach Two longitudinal case studies of the process of supply chain alignment were conducted based on 26 semi-structured interviews and 25 key documents including drafts of contracts and service level agreements. Findings The dynamic interplay of contracting and learning contributes to supply chain alignment. Exchange-, partner- and contract framing-specific learning that accumulates during the contracting process is used to (re)design pay-for-performance provisions. Such learning also results in improved buyer-supplier relationships that enable alignment, complementing the effect of contractual incentives. Research limitations/implications The study demonstrates that the interplay of contracting and learning is an important means of achieving supply chain alignment. Supply chain alignment is seen as a process, rather than as a state. It does not happen automatically or instantaneously, nor is it unidirectional. Rather, it is a discontinuous process triggered by episodic events that requires interactive work and learning. Practical implications Development of performance contracting capabilities entails learning how to refine performance incentives and their framing to trigger positive responses from supply chain counterparts. Originality/value The paper addresses supply chain alignment as a process. Accordingly, it stresses some important features of supply chain alignment