Quality Assurance Method for the Supply Chain of the Complex Product Under Reference Point Effects

Abstract

In the process of the supply chain’s quality cooperation, a main manufacturer’s psychological utility is not only affected by the delivery’s quality level but also the quality reference point, which is the industry average level. The participants’ economic value has been calculated by adjusting the risk avoidance coefficient, the production cost function and the quality improvement profit in the contract. Meanwhile, the objective programming model is constructed to calculate the maximum quality equilibrium solution of both parties. In this way, supplier's behavior is effectively controlled to realize the reciprocal transaction of supply chain quality cooperation. Keywords—quality assurance; psychological utility; reference points