An integrated mathematical programming model for offset planning

The ability of a company to compete successfully in a global environment often extends beyond the ability to sell a product at a given price or service level. International “deals” are often based upon the companyʹs ability to provide access to international markets (economic benefits), be perceived as socially responsible and meet political requirements. These requirements come in the form of offset, industrial participation or countertrade. Unfortunately, these factors cannot be measured in quantitative terms, but rather qualitative objectives. This paper presents the development of a quantitative model using multicriteria mathematical programming methods. This paper deals with the development of an integrated quantitative model for offset (countertrade) planning. The model includes multiple conflicting goals with inconsistent units requiring prioritization. As common in todayʹs business environment, a single methodology for solving problems is insufficient. This paper discusses a case in which business decision-makers can take existing models from analytic hierarchy process (AHP) in socio-economic literature and apply it to the well-established goal programming model for an empirical example, based on the data obtained from the U.S. aerospace companies. The model is solved by a Micro Management Science computer software and its result is analyzed. The model validation is performed by sensitivity and factor analyses.