Fair Distribution of Collaboration Benefits

Fair Distribution of Collaboration Benefits

António Abreu (New University of Lisbon, Portugal) and Luis M. Camarinha-Mato (New University of Lisbon, Portugal)
Copyright: © 2008 |Pages: 7
DOI: 10.4018/978-1-59904-885-7.ch079
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The participation in a collaborative network of enterprises is commonly assumed to bring valuable benefits to the involved entities (Afsarmanesh, Marik, & Camarinha- Matos, 2004; Axelroad, 1984; Dussauge & Garrette, 1999; Nemes & Mo, 2004; Penã & Arroyabe, 2002; Pfeffer & Salancik, 1978; Tuomi, 2003). These benefits include an increase of the “survival capability” in a context of market turbulence but also the possibility of better achieving common goals (Camarinha-Matos & Abreu, 2004; Richter, 2000; Saveri, Rheingold, & Pang, 2004). On the basis of these expectations are, among others, the following factors: acquisition of a (virtual) higher dimension, access to new/wider markets and new knowledge, sharing of risks and resources, joining of complementary skills and capacities, and so forth. But it is also easily recognizable that collaboration introduces high overheads due to the transaction costs (Williamson, 1975, 1985, 1998) which induce higher coordination costs and also due to the diversity of working methods and corporate culture.

Key Terms in this Chapter

Value Systems: A value system frequently understood as the ordering and prioritization of a set of values that an actor or a society of actors holds. The concept of a value system in a collaborative network context must be based on the notion that each product/service requires a set of value activities that are performed by a number of the network members forming a “value creation system” through a VO (this definition includes economic and ethical/ideological value as well). As a result, a value system is important in terms of providing a regulation role. For instance, regulation role can include assuring social cohesion to understand members’ behavior and to build performance indicators and transactions mechanism between partners, such as assuring an equality utility between objects exchanged.

Game Theory: A mathematical framework designed for analyzing the interaction between several entities whose decisions affect each other. An interactive situation is described as a game that has an abstract description of the players (entities), the courses of actions available to them, and their preferences over the possible outcomes. It is assumed that players employ rational decision making; that is, each player’s objective is to maximize the expected value of his own payoff, which is measured in some utility scale.

Fair Distribution: Distribution of the benefits based on presupposed of being just and unbiased.

Shapley Value: A measure of the utility of players in a collaborative or cooperative game, that is, an expression of the added value brought to a consortium by each member when joining the consortium.

Collaboration Benefits: The value in the sense of net profit, resulting from a process performed by a collaborative network.

Collaborative Network: An alliance constituted by a variety of entities (e.g., organizations and people) that are largely autonomous, geographically distributed, and heterogeneous in terms of their operating environment, culture, social capital and goals, but that collaborate to better achieve common or compatible goals.

Transactions Cost: Transactions costs are generally defined as the cost for gathering information, negotiation, and contracting, and physical transaction of objects through a defined interface. According to this theory, enterprises and markets are alternative governance structures that differ in their transactions costs. From this point of view, cooperation is explained as an organizational “hybrid” form between the market and the enterprise.

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