The optimal decisions and coordination for a production assemble system with random demand and supply

For a production assemble system with a manufacturer and two suppliers, manufacturerpsilas demand is stochastic, and the supply capability of suppliers is also stochastic. Before the demand was realized, manufacturer need determine the order quantity of two components, and the two suppliers produce components according to the manufacturerpsilas order. The system was analyzed under centralized and decentralized decision model. Firstly, the optimal order decision problem was researched under centralized model, the existence and uniqueness of the solution were proved, and the condition that optimal decision should be satisfied was given. And moreover, under decentralized model, the coordination problem was considered, a coordination mechanism was proposed and the method of solving the coordinate parameters was given. Finally, a numerical example was showed.