Abstract
We present a game theoretic model in which one manufacturer and its suppliers are coordinated. Quality of products from suppliers is considered on the decision process. Due to fluctuation of demand resulting from varying quality levels from suppliers, manufacturers are subject to financial risk. A game theoretic approach to resolve coordination between manufacturers and suppliers under risk and uncertainty is proposed. The objective is to help decision making for global manufacturing in order to improve quality in competitive global business. Computational experiments are conducted to demonstrate the effectiveness of the proposed algorithm.
