Internal pricing strategies design and simulation in virtual enterprise formation

A virtual enterprise (VE) is an organization intended to cope with the rapidly changing manufacturing environment. Organization building is important in virtual domains because it has largely been affecting the success of VEs. However, the process of forming a VE is based on self-determination by the participants. This paper adopts a bargaining model under a scenario of incomplete information to formalize the formation process, considers the characteristics of the VE formation process, presents the pricing strategies for the corresponding bargaining, and verifies the correctness and validity of the pricing strategies using computer simulation. This paper breaks through the relative research that compares the formation process with partner selection from the core enterprise's perspective and also provides the basis for the intelligent information platform of VE, whose key part is pricing software. © 2011 Elsevier Ltd. All rights reserved.