Assessing the value of information sharing and its impact on the performance of the various partners in supply chains

With major developments in information and communication technologies, real‐time information sharing becomes a significant challenge and has a considerable impact on the overall performance of supply chains. Here, we study the influence of information sharing for a monoproduct serial supply chain consisting of a supplier, warehouse, retailer and customers in the context of a decentralized decision. The objectives of this study are twofold: (1) to estimate the gains from sharing different types of information on each elementary cost and for each partner of the supply chain in detail and (2) to determine the cumulative impact of simultaneously sharing different types of information. A mathematical model is developed to assess the value of information sharing in terms of logistic costs and for different combinations related to the sharing or non‐sharing of three types of upstream and downstream information: the customer demand and the supplier‐warehouse and warehouse‐retailer lead times. A perturbation is also injected to consider the intended or unintended distortion in the communicated information. Our study clearly showed that the gains are not cumulative when we simultaneously share different types of information. The results also highlighted the necessity to establish incentive cooperation mechanisms between the different links in the supply chain in many scenarios where the gains are not balanced. A distortion in the communicated information can also have a significant effect on the gains from sharing.