Using Game Theory to Simplify the Blood Supply Chain
The act of donating blood is one of the most immediate methods of helping those in need. But, in a time where fewer than 10% of humans in the United Stated eligible to donate blood actually do so in a given year, it is imperative that all blood donations are handled, stored, and shipped properly to hospitals and other institutions. However, this is no facile task. Blood donations must be tested, verified, and used within a 42-day span and must be kept in a precise temperature and conditional setting throughout the whole process. To combat the difficulties of this blood supply chain, researchers have looked towards game theory to seek assistance in simplifying the arduous chain and ensuring the proper and efficient delivery of blood to patients across the United States.
The new supply chain management model takes into account previously known issues of blood perishability, outdating, shortage, and wastage as well as introduce new variables such as the limits on supply capacity. To outline these issues, the game theory model illustrates competition for blood donations on the supply side of the chain as well as competition for business on the demand side. Additionally, the question of wastage is answered by implementing lower and upper bounds on the volume of red blood cells needed at each participating hospital/medical provider’s demand point.
All this combined, the algorithmic solution of the game theory model outputs the optimal blood flows and the competitive prices that the supplier should charge for the blood sold. Also, because the supply of blood is contingent on human health, frequency of large disasters, and other factors, researchers have allowed for the continuous editing and adaptation of this model. By modeling the blood supply chain through game theory, decision-makers in the chain are enabled to determine the impacts of varying donor availability, increased competition, and blood flows.
The implementation of a game theory model in a realm as unpredictable as medicine may seem peculiar. However, just as any supply chain can benefit from the strategic analysis of its factors and underlying consequences, so can the blood supply chain. By pinpointing the different variables affecting the speed, availability, and cost of selling blood, game theory allows us to determine how a change in one factor can lead to large ramifications down the chain. Before, sellers and buyers of blood existed without clearly understanding how the supply and demand for blood would change from day to day. Now, through the help of game theory, both nonprofits and hospitals alike can obtain a clearer picture of each other and how different variables within the supply chain can affect both parties. This way, hopefully, the blood of one devoted human being can be utilized to help another in need.
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