Abstract :
The materialized form of supply chain management platform based on transaction cost theory is composed of market, outsourcing (including internal outsourcing and external outsourcing), self-operation in house. It is suggested that application service provision (ASP) belongs to the third wave of outsourcing. Based on Williamson´s heuristic model, Firstly, this paper deeply analyzes the efficiency of the ASP and the firm´s vertical boundary with asset specificity as variable expressed with k while the sum of the production cost difference expressed with Delta C and transaction cost difference with DeltaT as the dependence variable. It is found that if (DeltaC + DeltaT)>0, then the efficiency of the market is higher than that of the internal integration; If (DeltaC + DeltaT)<0, it concludes to the contrary. K* is the threshold point, that is the vertical boundary. Secondly, this paper expounds the IT external outsourcing area. Research founds that with the development of IT and the good relationship established with ASP, the firm´s vertical boundary moves to the right side K **. The range between K* and K** is the general IT external outsourcing Area. At the same time, the efficiency of IT external outsourcing is increased. Thirdly, background of internal outsourcing and its area is explained. It is found that, with the occurrence of oligopoly to IT industry, the boundary of the firm is adjusted to K*** and external market space shrinks. The area between K*** to K* becomes the internal outsourcing space. As the supply chain management of military, it is quite different with the general production enterprises. The platform of military supply chain management requires much more customizable, personality, and it is greatly dependent on the IT providers and IT quality/level. It shows the characteristics of oligopoly. As a conclusion that IT internal outsourcing may be the best selection to the military supply chain management. The military appliance system may c- o-invest with the research bureau of the military in IT, and delivers the regarding service to internal ASPs.
Keywords :
costing; economics; military computing; oligopoly; outsourcing; supply chain management; IT external outsourcing; IT industry; IT internal outsourcing may; IT quality; Williamson heuristic model; application service provision; asset specificity; military supply chain management platform; oligopoly; production cost difference; self-operation; transaction cost economics analysis; transaction cost theory; vertical boundary; Application specific processors; Companies; Costs; Energy management; Intelligent robots; Logistics; Oligopoly; Outsourcing; Production; Supply chain management; ASP; IT external outsourcing; IT internal outsourcing; IT operation in house; military supply chain management platform;
