Negotiation Automation Platform Testbed

Fast Facts

MEMBER Participants:

NEC Corporation, Fraunhofer IOSB, Korea Electronics Technology Institute (KETI), Kabuku

MARKET SEGMENT:

Manufacturing, transportation and logistics

CHALLENGE:

In order to realize a mass customization economy, it is essential to improve the efficiency of coordinating trading conditions among many companies on the supply chain / value chain, in addition to improving the efficiency of manufacturing and logistics executions themselves.

The frequency and complexity of coordination will dramatically increase compared to those in the era of mass production economy. In addition, manual handling will be difficult or even unrealistic.

The challenge of this testbed is to build a market place for efficient matching and negotiation of win-win relationships in the mass customization economy by utilizing AI and IIoT.

Solution:

By alternating offers and counter offers between AI agents of the buy-side and the sell-side of manufacturing and logistics, the trading conditions that both parties can agree on are searched and negotiated automatically.

The AI agents play the important role of evaluation of the utility function of trading conditions based on IIoT operational information from the edge, planning information etc.  The AI agents are also responsible for negotiation, automatically generating offer conditions, and determining whether to accept an offer from the counterpart or not, based on the utility function.

How It Works:
  1. Market participation registration
    Market participants register for the negotiation platform.
  2. Negotiation target product / service registration
    Market participants register the products and services they want to trade utilizing the negotiation
    platform, and input negotiation strategies to their negotiation AI.
  3. Negotiation counterpart search
    A market participant who wants to initiate a trading, can find counterparties using a search/recommend service by the platform.
  4. Automatic negotiation
    Coordination of the terms and conditions with the selected counterparties is performed among the negotiation AIs through the platform using standard protocols, formats, vocabulary definitions, etc.
  5. Contract confirmation
    Final decisions are supposed to be made by humans.  The market participants involved (humans) confirm whether they will actually contract on the terms and conditions agreed by negotiation AI.
  6. Contract fulfillment
    Contracts exchanged are transmitted to and fulfilled by manufacturing and logistics sites.
COMMERCIAL BENEFITS:

Business

  • Expansion of business partners
  • Discovery of better conditions for both sides (Sell side/ Buy side)
  • Efficiency of negotiations and arrangements

Economic

  • Simultaneous achievement of economic efficiency and market expansion
  • New eco-system including negotiation proxy service or marketing

Social

  • Realization of Mass-Customization society
  • Reduction of waste by precise supply-demand-matching of manufacturing and streamlining of logistics

The Testbed

This testbed enables flexible automated negotiation of detailed trading conditions and business counterpart matching across manufacturing supply chains, by employing new AI-based negotiation technologies and real-time production & logistics data.

In a manufacturing use case, automatic negotiation on conditions of trading products benefits both buyers and sellers. It enables buyers to satisfy their needs through flexibly expressing their procurement requirements, and enables sellers to expand opportunities for orders and profits by making full use of assets.

In a logistics use case, automatic negotiation enables on-demand shared transport services which helps factories to minimize their transport systems in the current business situation where dedicated logistics costs are high and redundant traffic increases the total vehicle traffic.

Negotiation Automation Platform (NAP) has the three-tier structure of Edge Tier, Platform Tier and Enterprise Tier as in the Industrial Internet Reference Architecture (IIRA).  Negotiation agents are in the Enterprise Tier and they need information on planning of production or transportation in the Platform Tier. In the Edge Tier they need IoT information such as line performance/healthiness, stock volume, truck position, and vacant space.

Interested in learning more about the Negotiation Automation Platform Testbed? Email us!

Contact the testbed team here.


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