Supplier Hierarchical Structure Management Based on Markov Chain

It is well known that maintaining stable stale supply chain is absolutely necessary for enterprises, so how to manage supplier hierarchical structure becomes an important content in SCM. In this paper, a model based on Markov chain is provided for supplier hierarchical structure management. The model focus on describing the change of supplier hierarchical structure, forecasting future supplier hierarchical structure, and seeking for strategy so as to achieve some ideal supplier hierarchical structure. At the same time, some academic conclusions are drawn to improve supplier hierarchical structure management.