# Collaborative Planning in Non-Hierarchical Networks--An Intelligent Negotiation-Based Framework
## 2 Collaborative Planning--Technical Background
### Collaborative Planning  
A major challenge for networked organizations in delivering products and services arises from the complexity of planning individual tasks for different operational processes. According to [PERSON], [PERSON], and [PERSON] [17], networked planning decisions include order releasing for procured material (procurement), lot sizing, production planning and scheduling, manufacturing execution control, and detailed definition of distribution flows, routes, and transport loads (distribution). Several instances of these activities are performed in different locations along each node of the supply chain. This means that each individual planning system must be aligned with the remaining systems in the network in order to deliver feasible plans. Traditionally, the only possible way to manage such supply chain planning integration was to assume a centralized planning approach that integrates all participating units. This approach relied on information systems called supply chain management (SCM) systems. SCM systems were designed to handle data on incoming raw materials from outside suppliers, deliver data on distribution flows for customers, and synchronize internal work processes with outward flows. In practice this system is suitable for companies belonging to the same group or with a strong commitment to a supply chain \"owner\". On the other  
Figure 1: Collaborative networking manufacturing lifecycle phases. hand, SCM systems cannot be applied to external companies that compete in the same market and are independent. A significant challenge arises when there is a need to link and coordinate the manufacturing operations between independent companies belonging to the same supply chain. Several authors argued in favor of a negotiated approach to achieve synchronization between production plans from each one of the companies participating in the supply chain [17; 18; 19; 20; 21]. Aligned with the negotiation concept, [PERSON] [22] introduced a coordinated scheme based on negotiations, wherein two or more decision-making units collaborate to develop synchronized production plans. This decentralized approach enables all network members to adjust their individual manufacturing plans, aiming to achieve a mutually acceptable overall plan for all supply chain partners. It emphasizes active contributions from all involved parties, in contrast to centralized planning approaches that disregard such involvement. This proposal aims to provide an overall optimized solution for a business opportunity that emerges within the context of the supply chain through effective coordination. A consensual definition of collaborative planning (CP) was presented by [PERSON] and [PERSON] [23]. The authors defined collaborative planning as a linking of different local planning processes and domains that, through collaboration, achieve a common and mutually agreed network plan. To accomplish an overall collaborative plan, the partners share pertinent information, allowing a synchronous and accurate update of the planning results. The main reason behind an integrated supply chain management solution for non-hierarchical and decentralized networks arises from the competitivity challenge. Through the collaborative planning approach, it is possible for these networked organizations address the following issues [24]:  
* How to efficiently tackle each one of the business opportunities posed by the market with the joint competencies present in the network members. * How to provide a transparent environment with problem solving mechanisms between the supply chain members. * How to efficiently use the available capacity across the manufacturing stages along the supply chain. * How to achieve global efficient solutions through the elimination nonoptimized activities.