Salvatore Ammirato
email: salvatore.ammirato@unical.it

Alberto Michele Felicetti
email: alberto.felicetti@unical.it

Tourism Breeding Environment: Forms and Levels of Collaboration in the Tourism Sector

Keywords: Tourism Breeding Environment, Collaborative Networked Organizations, Tourism Extended Enterprise, Tourism Virtual Organization

des établissements d'enseignement et de recherche français ou étrangers, des laboratoires publics ou privés.

Introduction

Tourism made a significant contribution to the economies of many nations around the world because of its ability to create income, taxes, and employment [START_REF] Lee | Investigating the influence of tourism on economic growth and carbon emissions: Evidence from panel analysis of the European Union[END_REF]. T provides a strong impact on the global economic development, employing more than 210 million people worldwide (7.6% of global employment) and generating an estimated US$ 5,474 billion of economic activity (9.4% of global GDP) [START_REF]World Travel & Tourism Council, Travel & Tourism Economic Impact[END_REF]. Impressive changes in the ICTs and the Internet caused an extensive transformation of the industry. Demand and supply of ICT have innovated considerably Tourism Sector in operational workflows, management and marketing of tourism packages and new paradigms in tourism experiences [START_REF] Polo Peña | Impact of Customer Orientation and ICT Use on the Perceived Performance of Rural Tourism Enterprises[END_REF]. ICTs provide significant opportunities for internal business process re-engineering and e-business, at the company level, while, at the industry level, ICTs allow communication and information exchange with partners, integration of information flows from a wide spectrum of suppliers, and new patterns for the customer care [START_REF] Stamboulis | Innovation strategies and technology for experience-based tourism[END_REF].

Changes are evident from the industry side. The Internet is changing the industry structure by altering barriers to entry, revolutionizing distribution channels, facilitating price transparency and competition, as well as enhancing production efficiency [START_REF] Mills | Handbook of consumer behavior, tourism and the Internet[END_REF]. As tourism companies become a part of the global economy, local collaborative actions that generate externalities for the companies increased in importance. Engaging in new forms of collaboration and maintaining relationships within business networks have become a natural way for organizations to meet performance requirements in competitive markets [START_REF] Erkus-Otzurk¸ | Environmental governance for sustainable tourism development: Collaborative networks and organisation building in the Antalya tourism region[END_REF] [START_REF] Plummer | A Study of Collaboration within the Tourism Industry[END_REF]. Since nineties, several case studies and models highlight the increasing importance of tourism partnerships, assessing new organizational forms and identifying key factors in successfully initiating and sustaining tourism development [START_REF] Jamal | Collaboration theory and community tourism planning[END_REF] [START_REF] Selin | Tourism marketing alliances: member satisfaction and effectiveness attributes[END_REF]. Many case studies in literature agree that a high integration level among partners results in terms of internal efficiency and resource saving of partners in collaboration. Furthermore, problems are better understood when analysed from different perspectives, thus a collection of differently skilled partners can, in principle, go beyond individual knowledge and reach new solutions for the whole business network's questions [10][11][12] [START_REF] Sofo | best: Geographical location and the thinking styles of Italian university students[END_REF].

From tourist side, the breakdown of geographical and cultural barriers is a result of international cooperation/exchange agreements and fast advances in transportation, communication and electronic communication. New and cheap means of transport, reductions in custom duties and on limitations to cross-countries tourism, allow people easy consuming of tourism products. E-commerce developments enable tourist to interact directly with tourism service providers, allowing travelers to retrieve reliable and accurate information in a fraction of the time, cost and inconvenience required by conventional methods, often disintermediating traditional players of tourism market such as travel agencies and tour operators [START_REF] Mihajlović | The Impact of Information and Communication Technology (ICT) as a Key Factor of Tourism Development on the Role of Croatian Travel Agencies[END_REF]. Furthermore, new forms of tourism experiences are emerging related to the rediscovery of rural places as a way to gain wellbeing and relaxed life by enjoying the benefits of relocalisation [START_REF] Volpentesta | Networking agrifood SMEs and consumer groups in local agribusiness[END_REF]. From these changes, main consequences for tourists are:

• from an operational viewpoint, the ever more diffused self-creations of tourism packages, often comprising online reservations and payments [START_REF] O'connor | An evaluation methodology for hotel electronic channels of distribution[END_REF]. • From a decisional point of view, the increasing request for personalized forms of tourism experience sometimes based on the rediscovery of cultural heritage, folklore, traditions, as well as on the direct contact with the nature [17] [18] . In many regions with tourism vocation, local entrepreneurs have started organizing themselves in tourism networks in order to create aggregate tourism offers able to compete with big players. New business models have developed with the aim to reach competitive advantages, to improve revenue streams, to return in taking an active role in the tourism system, and to develop new consumer market niches [START_REF] Wanga | Collaborative destination marketing: A case study of Elkhart county, Indiana[END_REF]. Such models of collaborative networks in the tourism sector are characterized by a direct connection among local service providers and tourists with these explicit ethical and political goals: re-vitalisation of territory identity and local community relations to local natural, cultural and historical heritage, linking with sustainable agriculture and handicraft, economically viable and socially responsible practices [START_REF] Volpentesta | Alternative Agrifood Networks in a regional area: a case study[END_REF].

In this paper we propose an organizational model of breeding environment for the tourism sector where regional tourism operators can operate in order to timely exploit opportunities coming from the tourism industry evolution while gaining sustainable development for the whole regional area. The paper is organized as follows. After summarizing latest trends in tourism market in section 2, a characterization of the organizational forms of collaborative networked organizations proper of the tourism sector is proposed in section 3. Section 4 discusses the possible levels of collaboration that can be observed during collaboration while section 5 contains conclusions.

Tourism Breeding Environment and Forms of Collaboration

In a territory with a touristic vocation, live and operate autonomous entities whose business is related to the sector. While these entities can be heterogeneous in terms of their operating environment, culture and goals, they all aim to achieve the common goal of local tourism development and to increase the general competitiveness respect to other geographical areas and global competition. These entities constitute the reference universe of this study and we define them as Regional tourism operators.

The regional tourism operators can be grouped into the following categories: • Hospitality Services Enterprises: companies that offer overnight accommodation (e.g. hotels, B&B) and meal provision (e.g. restaurant). • Transportation Services providers: public and private companies that provide services of people transportation (i.e. buses, taxies, airplanes, trains, etc). • Event Management Services: public and private companies dealing with the organization of events (e.g.: conferences, concerts, exhibitions, sport events). • Tourism complementary goods and services providers: e.g. local shops, museums, excursion services, sport & leisure facilities, handicrafts. • Destination Marketing Organizations: that promote incoming tourism and Tour operators that purchase/book services to combine and resell them. When some of the regional tourism operators decide to reinforce collaboration, they can set stable agreements in the forms of Touristic Associations or Touristic Districts, adhering to a base long term cooperation agreement, and adopting common operating principles and infrastructures. Each agreement is characterized by an own organizational form in terms of structure of membership, activities, definition of roles of the participants, governance principles and rules [START_REF] Volpentesta | Networking agrifood SMEs and consumer groups in local agribusiness[END_REF]. We name each of such agreements as a Tourism Breeding Environment (TBE) [START_REF] Loss | Tourism Breeding Environment: Business Processes Applied to Collaborative Networks in Tourism and Entertainment Sector[END_REF] i.e. a Breeding Environment in tourism sector whose members share values, culture and infrastructures and have the potential and the will to cooperate in order to pursue the general long-term objectives of territory development and competitiveness [START_REF] Volpentesta | Enabling Virtual Organizations in a Technological District[END_REF]. In a TBE, each member competes with the others and with players outside the TBE in searching for new business opportunities in the global market. When a business opportunity is identified, a subset of the TBE members can be rapidly selected to become part of a short term Collaborative Networked Organizations, CNOs, oriented to catch the opportunity. Two kinds of short term CNOs are most evident in a TBE:

• Tourism Extended Enterprise (TEE): it refers to a tourism operator that "extends" its business boundaries by involving all or some of its suppliers in the product packaging and delivery in order to offer customers possibilities to a more complete tourism experience. For example, a TEE can be formed by a hotel that stipulates commercial agreements with restaurants, lidos, amusement parks, cruise ship companies. Tourist perceives the overall TEE offer as a whole and, typically, purchase it directly at the hotel (web)site. • Tourism Virtual Organization (TVO): It represents a temporary alliance of private and public organizations that come together to share skills or core competencies and resources in order to better respond to business opportunities, and whose collaboration is supported by computer networks. A TVO is established in a short time to respond to a competitive market opportunity; it has a short life cycle dissolving when the short-term purpose of the TVO is accomplished [START_REF] Volpentesta | Enabling Virtual Organizations in a Technological District[END_REF]. ICT advances enable tourists in customizing services on the basis of their own specific tastes [START_REF] Corvello | An empirical study of individual factors affecting the usefulness of internetbased platforms for open innovation in broadcast search processes[END_REF]. Availability of systems for tourism packaging enable tourist to (self) compose a personalized tourism product choosing a subset of services provided by TBE members (an example of tourism package can be: 2 nights in the hotel A, 1 night in the hotel B, 2 meals in the restaurants C, 1 ticket for a football match, etc.). The set of all services in its personalized package is, usually, supplied by more than one service provider; tourist, while purchasing the package, is indirectly triggering a TVO responsible to deliver the personalized tourism package.

Levels of Collaboration in a Tourism Breeding Environment

Tourism operators may interact in different way in a TBE. Four coalition's types can be recognized within a TBE, each of them represents a different level of integration among considered groups of actors: networking, coordination, cooperation, collaboration [START_REF] Camarinha-Matos | Collaborative Networks: Value creation in a knowledge society[END_REF]. According to [START_REF] Camarinha-Matos | Collaborative Networks: Value creation in a knowledge society[END_REF], "as we move along the continuum from networking to collaboration, we increase the amounts of common goal-oriented risk taking, commitment, and resources that participants must invest into the joint endeavor". In what follows we propose the four levels highlighting, for each of them, characteristics of interactions and types of technologies best suited to supporting collaboration among partners.

Level 1 -Networking. It involves communication and information exchange for mutual benefit of TBE. Each TBE actor involved in the relationship can benefit from the information shared but there is not necessarily a common goal influencing individual contributions as well as there is no common generation of value. At this level, it's not possible to highlight the presence of CNOs within the TBE. A TBE offer to each tourism operator a way to grasp opportunities that current demand of tourist flows is producing. In particular, individual actors may benefits from integrate communication and promotion activities performed by the TBE. It represents a local brand that propose a diversified tourism offer, contributing to local tourism development and to increase the local competitiveness respect to other geographical areas. This is the case of a Touristic Associations that aim to promote tourism activities in a specific territory and offer to tourism operator a "showcase" in order to promote their own services. While a TBE promotes a common brand, a slogan, a symbol, etc., individual operators are responsible for the accuracy and the correctness of the information provided about offered services.

At Networking level, it is possible to identify a set of ICT solutions representing a valid support for promoting a tourist destination:

• Inspiration Portals: websites promoting the sharing of multimedia content among users by allowing them to get a preview of territories, places, cultures and type of vacation that will inspire potential tourists [START_REF] Not | Supporting Users in Organizing their Vacation Before, During, and After the Travel[END_REF].

• Tourism services comparators: web portals that allow travelers to compare tourism services offered by different providers. Travelers have the possibility to compare services providers and chose the offer that best suits their needs [START_REF] Zanker | Evaluating Recommender Systems in Tourism[END_REF]. • Tourism social networks: collection of individuals who share information, opinions and contents about tourism in an online setting over the internet [START_REF] Mihajlović | The Impact of Information and Communication Technology (ICT) as a Key Factor of Tourism Development on the Role of Croatian Travel Agencies[END_REF]. • Mobile and immersive technologies: technologies that harness the potential of mobile devices to provide information, geolocation, and augmented reality services; information about the surrounding real world becomes interactive and digitally manipulable [START_REF] Emmanouilidis | Mobile guides: Taxonomy of architectures, context awareness, technologies and applications[END_REF]. Mobile services support users with additional information such as maps, points of interest, tourist guides that overlaid the real world. Tourists interact with the surrounding reality and get information on areas of interest typical of tourist services (hotels, restaurants, etc.) and public utilities services (public transport networks, events, etc..,). From a functional viewpoint, process automation is low being related to supporting horizontal communication with the aim of developing teamwork, share information and promoting activities' coordination within and among organizations. From a technological point of view, automation technologies are intended to supporting communication technologies between tourism operators and tourists.

Level 2 -Coordination. In addition to communication and information exchange, more organizational commitment is evident at this level. Coordination involves aligning/altering activities so that more efficient results are achieved; nevertheless each networks member might have a different goal and use its own resources. In order to expand its own tourism offer and capture new customers, a tourism operator can tighten symbiotic relationship with other tourism operators that complement each other or have reciprocal products. This is the case of an operator which originates a TEE that "extend" business services, proposing to customers complementary tourism services provided by other tourism operators.

At the coordination level, ICTs are intended to support automation of interorganizational business process. In addition to the tools typical of the networking level, at this level technologies need to support tourist to take advantage of integrated offerings. Examples of such technologies are the Destination Management Systems (DMSs), i.e. systems that gather into a single portal a variety of tourism services provided by heterogeneous tourism operators and related to a specific geographical area. DMS attempt to utilize a customer centric approach in order to manage and market the destination as a holistic entity, typically providing strong destination related information, real-time reservations, destination management tools and paying particular attention to supporting small and independent tourism suppliers [START_REF] Akoumianakis | Ambient affiliates in virtual cross-organizational tourism alliances: A case study of collaborative product development[END_REF].

Level 3 -Cooperation. In addition to level 2, it involves knowledge and resources' sharing for achieving compatible goals of TBE. In this case the aggregated value is the result of the addition of individual "components" of value generated by the various participants in a quasi-independent manner. A common plan exists which in most cases is not defined jointly but rather designed by a single entity. Participants' goals are compatible in the sense that their results can be added or composed in a value chain leading to the end-product or service. Trust plays a key role in the willingness of network members to cooperate in tourism services provision. The risk of opportunism is crucial at this level and it is mainly based on partners' behavior manifested during group's interaction. A partner needs to signify its trustworthiness through the way it be haves in the alliance. This is the case of a TBE that allows tourist to compose a customized tourism package (whether by means of an automated tourism packaging system or supported by a travel agency operator) combining and organizing services provided by multiple tourism actors members of the TBE. The composition of a such tourism package indirectly determine the creation of a TVO among the providers of each service in the package. In the TVO, each tourism services provider is responsible for the correct provision of its part of the service.

At this level it is desirable to use web and mobile based systems which enable consumers to build their own tourism package made of flights, accommodation, and other tourism services instead of purchasing a predefined package from a catalogue. This kind of technologies are known as Tourism Dynamic Packaging Systems, TDPS, whose characteristics are: full automation through online applications; real-time update of travel product information; single price for an entire tourism package. From a process automation point of view, distributed business processes management tools are required in order to allow integration and communication processes between individual information systems adopted by tourism each operator [START_REF] Zach | Tourist Activated Networks: Implications for Dynamic Packaging Systems in Tourism Information and Communication Technologies in Tourism[END_REF].

Level 4 -Collaboration. At this level, all entities share information, knowledge, resources and responsibilities to jointly plan, implement and evaluate a program of activities to achieve a common goal. It implies sharing risks, resources, responsibilities, and rewards. Tourist operators committed in collective decision process have common values and visions. The TVO becomes a self-organizing system with global properties that cannot be predicted from the properties of the economic actors who are directly involved in it. This is the case of a TBE that allows the composition of a customized tourism package in a seamless and transparent way to the customer. Partners of the resulting TVO have joint identity, goals and responsibility; the TBE constitutes the unique interface for the customer and it's responsible for the correct provision of the tourism package.

At this level the inter-organization process planning and management regards many operative and supporting processes which are managed in a common way. The CNOs can be supported by a form of Enterprise Resource Planning technologies for tourism networked organizations also known as a Cloud-Based Business Network that connects and coordinates the ERP of each networked tourism operator on a common platform. "Business networks supplement ERP systems, rather than replacing them. The ERP system remains the system of record and the guardian of the internal processes of the enterprise, while the business network provides the system of process, the platform for working with trading partners to meet customer needs profitably and expeditiously" [START_REF] E2open | White Paper: ERP and the Business Network[END_REF].

Conclusions

The importance of setting a TBE is related both to the necessity to answer to the request of personalized tourism offer, in line with the new demand trends, and to the possibility to give sustainable development to local tourism players in the effort to overcome limits of touristic organization's size and reach economy of scale and competitiveness in contrast to big players. The availability of organizational models and ICT supporting solutions make possible the operationalization of the collaboration concept in the tourism sector and the setting up of CNOs in a TBE at different level of collaboration, in line with the territorial development strategies and tourism operators' propensity to risk taking. In this paper we proposed a characterization of the organizational forms of collaborative organizations proper of the tourism sector and discussed the possible levels of collaboration that can be observed in those forms. Further studies are undergoing in order to provide a mechanism to identify and assemble competencies in a TBE in order to determine the source and type of competencies needed to efficiently and timely catch opportunities and to individuate the best TBE partners to involve to carry out a specific business.


Omir Correia

Alves Junior

Ricardo J Rabelo
email: rabelo@das.ufsc.br

Rafael G Vieira

Adriano Fiorese
email: adriano.fiorese@gmail.com

A Risk Analysis Method for Selecting Logistic Partners to Compose Virtual Organizations

Keywords: virtual organization, logistics partners' selection, KPI, risk analysis

Virtual Organizations (VO) have complex interactions between their members, both industrial and logistics. Once industrial partners are selected, the VO should be complemented with the logistics partners that will deliver the produced goods between those partners. This paper presents a supporting decision method for selecting the most suitable logistics partners that consider not only capabilities, historical performance and availability, but also risks. In general, a risk is characterized by the potential of each logistic partner to do not fulfill VO's business requirements and that can jeopardize its accomplishment. The method firstly evaluate and measure risks per partner, and collectively afterwards. Its formalization and examples are provided along the paper. Discussions are presented in the end.

Introduction

Companies have increasingly been immersed in more dynamic and adaptive value chain networks so favoring the expansion of logistic partners. New markets and new products have been increasingly created all over the world and proper logistic partners should be hired in order to cope with this need. The cleverer the hiring activity is done, the greater visibility, improved customer service, better planning and cost savings can be supported [START_REF] Mentzer | An efficiency/effectiveness approach to logistics performance analysis[END_REF]. This cleverness can also be crucial for companies as a support for reindustrialization and for facing current economic challenges. However, when companies get involved in more volatile strategic networks, the difficulty of selecting the most appropriate logistic partners is much higher.

This work focuses on the Virtual Organization (VO) type of strategic network. A VO is a temporary and dynamic alliance of autonomous, heterogeneous and usually geographically dispersed companies (often SMEs) created to attend to certain demands [START_REF] Mowshowitz | A: Virtual Organization[END_REF], sharing costs, benefits and risks, acting as they were one single enterprise [START_REF] Camarinha-Matos | On reference models for collaborative networked organizations[END_REF]. A VO dismisses itself after ending all its legal obligations. Therefore, part of that difficulty in terms of logistics is due to the VO intrinsic nature, that industrial partners are only known after an analysis of the demand's requirements.

Once industrial partners are selected and hence the VO is formed, it should then be complemented with logistics partners (LP). By LP it is considered in this work the logistics providers (of types 2LP and 3PL) which act at the 'arc' part of the network (outbound) and that are totally responsible for delivering the produced goods between VO's industrial partners.

In a previous work authors conceived a model to select LPs [START_REF] Alves Junior | A KPI model for logistics partners´ search and suggestion to create virtual organizations[END_REF]. It applied fifteen key performance indicators (KPI) over the set of possible LPs to further select the most adequate ones for each logistic leg considering the VO's industrial partners and the whole logistics path. This selection was based on the LPs' historical performance in past VOs, on their technical competence and temporal availability, and on the demand's requirements.

The problem is that, even considering such elements, there is a risk of failure. Faults in some LP can affect other partners and lead the given VO to fail in its goals [START_REF] Grabowski | Risk Mitigation in Virtual Organizations[END_REF]. Therefore, it is very important to measure them for further decision-making.

In this sense, this paper presents a complementary work to also take risks into account. Considering a sort of potential sources of risks, the VO risk of each possible composition of LPs is calculated so that the responsible stakeholders can select the most qualified and less risky list of LPs for a given VO before it goes for operation. Besides that, they can further act towards mitigating risks if it was the case.

This work presents results of an ongoing, applied and qualitative research which basically look for answering how LPs for a given VO can be more properly measured when considering risks. It is represented by a novel method for risk analysis in the formation of VOs called MRALP (Multi criteria Risk Analysis method applied to Logistic Partner). ETA and FTA risk analysis methods [START_REF] Vose | Risk Analysis: A quantitative analysis[END_REF][START_REF] Ericson | Hazard Analysis Techniques for System Safety[END_REF] are the essential theoretical basis for the proposed method.

In this work the current focus is only on LPs, not covering yet the VO as a whole, i.e. the industrial partners as well. Besides that, it assumes that LPs are be members of long-term alliances (like VBE [START_REF] Camarinha-Matos | On reference models for collaborative networked organizations[END_REF]) so sharing some minimum and common collaboration, working, quality and performance principles.

This paper is organized as follow: Section 1 has introduced the general problem and paper's goal. Section 2 addresses the problem of selection of LPs for VO and contextualizes it within the risk analysis area. Section 3 presents the proposed method. Section 4 shows an example of the method. Finally, Section 5 provides preliminary conclusions about this research.

Risk Analysis in Virtual Organizations

There are many definitions of what risk means in the literature. In resume, risk can be defined as the probability of an event to can occur and that causes a negative or positive impact on the organization's goals when it takes place. A risk can be viewed as a composition of three basic elements: the general environment within it can happen; its probability of occurrence; and the scope of its impact in the case of its occurrence [START_REF] Vose | Risk Analysis: A quantitative analysis[END_REF]. In the context of this research, a risk is characterized by the potential of each LP does not cope with the given demand / collaboration opportunity's (CO) requirements and hence can jeopardize the VO accomplishment. Thus, it is necessary to comprehensively identify and quantify the VO risks associated to the selected LPs.

In the research review a number of risk analysis methods has been identified as potentially suitable for VOs, namely FMEA (Failure mode and effects analysis), FTA (Fault Tree Analysis), ETA (Event Tree Analysis), Bayesian Networks, CNEA (Causal Network Event Analysis) and Ishikawa Diagram [START_REF] Vose | Risk Analysis: A quantitative analysis[END_REF][START_REF] Ericson | Hazard Analysis Techniques for System Safety[END_REF][START_REF] Bentley | Multidimensional binary search trees used for associative searching[END_REF][START_REF] Rychlik | Probability and risk analysis: an introduction for engineers[END_REF][START_REF] Rhee | Using cost based FMEA to enhance reliability and serviceability[END_REF][START_REF] Bertsche | Reliability in automotive and mechanical engineering[END_REF]. Some requirements can be pointed out for the tackled problem [START_REF] Ryclik | Probability and risk analysis[END_REF]: events can be treated as independent from each other; the deterministic relation between events can be known; events analysis can be both qualitative and quantitative; a risk can be globally quantified after a succession of events. Regarding these requirements, ETA and FTA techniques were selected to be used and combined in the proposed method.

In a review of the state-of-the-art some works related to risk analysis for VOs failures have been identified. In [START_REF] Alawamleh | Risk Sources Identification in Virtual Organisation[END_REF][START_REF] Alawamleh | Analysing virtual organisation risk sources: An analytical network process[END_REF] thirteen KPIs were identified as general risk sources in VOs, further identifying the importance of each one. In [START_REF] Li | Decision support for risk analysis on dynamic alliance[END_REF] two sources of risks were specified (external and internal) and risk occurrence likelihood in the life span of a VO was calculated based on them. In [START_REF] Grabowski | Risk Mitigation in Virtual Organizations[END_REF] the problem of risk mitigation in VO was discussed and four processes were identified to improve the level of VO performance reliability. In spite of the value of their results and that some insights have been taken from them to this work, none of them has neither somehow formalized how the proposed KPIs should be used nor provided means to quantity VO partners' risks, both individually and collectively. Actually, it was not found out any work in the literature that has tackled logistics issues and measured VO risks.

Considering the classical main phases of a VO life cycle (creation, operation, evolution and dissolution phases) [START_REF] Camarinha-Matos | On reference models for collaborative networked organizations[END_REF], risk analysis should ideally be done along the entire process. The scope of this research is however focused on the creation phase, i.e. to provide means to managers to evaluate the VO before its operation.

Within the creation phase, and respecting the reference framework for the VO creation [START_REF] Camarinha-Matos | On reference models for collaborative networked organizations[END_REF], it seems more natural that risk analysis be carried out in the Partners' Search and Selection step, i.e. after the VO topology are defined and before selected partners starting eventual negotiations. In [START_REF] Baldo | A framework for selecting performance indicators for virtual organisation partners' search and selection[END_REF] authors expanded this step to introduce a process of selecting the proper performance indicators that should be applied over candidate industrial partners' (IP) for a VO regarding the CO. In [START_REF] Alves Junior | A KPI model for logistics partners´ search and suggestion to create virtual organizations[END_REF] this same framework was complemented and expanded again to comprise the selection of logistics partners (Figure 1). The work presented in this paper introduces an additional sub-step within this part in order to embrace risk analysis (circle in Figure 1).

When related to VOs, risks can be identified and measured considering the equivalent factors that determine the risk probability in traditional organizations [START_REF] Grabowski | Risk Mitigation in Virtual Organizations[END_REF]. As such, they should consider the organization's goals so that the most important ones can be determined for more proper management. Identifying risk sources is the first and crucial step in risk management [START_REF] Vose | Risk Analysis: A quantitative analysis[END_REF].

Although risk analysis is performed in the Creation phase, sources of risks should be identified and risks measured having in mind the whole VO life cycle [START_REF] Li | Decision support for risk analysis on dynamic alliance[END_REF]. There are four main sources of risks regarding VOs: trust, communication, collaboration and commitment [START_REF] Alawamleh | Risk Sources Identification in Virtual Organisation[END_REF][START_REF] Alawamleh | Analysing virtual organisation risk sources: An analytical network process[END_REF]. In this work they are modeled as KPIs and their values are calculated and provided by the previous method phase, developed in [START_REF] Alves Junior | A KPI model for logistics partners´ search and suggestion to create virtual organizations[END_REF].

 Trust: Logistic partners who are going to compose a VO do not necessarily have prior knowledge about each other before starting collaborating. Thus trust is crucial to bear in mind, which in turn involves commitment in doing the planned tasks. When trust among partners is not enough established there is a hesitation to share risks and so the VO can be jeopardized.  Communication: Communication among VO's LPs is a key factor for its proper operation. They should provide correct information about parts, products and services, collaborating in solving conflicts, sharing practices, etc. However, this can be complicated by the fact that LPs are heterogeneous, independent, geographically dispersed and usually have distinct working cultures. The insufficient communication can put a VO on risk.  Collaboration: Collaboration is characterized when the sharing of risks, costs and benefits of doing business are agreed and fairly distributed among partners. However, when a collaboration agreement is not clearly defined, i.e., when there is no clear definition of its main objectives, the risk of a VO increases.  Commitment: Commitment is related to the attitude of VO partners with each other, i.e. it considers the contributions and agreements made by and among them for a business. This is important as partners use to have complementary skills and so it is important they feed the whole environment with the right and timely information. The VO risk gets higher when partners fail in that attitude.

Fig. 1. Extended framework for the VO creation [START_REF] Alves Junior | A KPI model for logistics partners´ search and suggestion to create virtual organizations[END_REF].

The Proposed Risk Analysis Method

In general, the most important requirement for any method related to VOs is transparency, which is a basis for trust building among partners. In this direction, being a selection (or suggestion) process, this work helps in leaving clear the criteria for that as well as in providing a more systematic process, i.e. a formal method. The devised model for risk analysis starts having as input a pre-selected and ranked list of most suitable LPs for each itinerary within the given VO. As mentioned in the introduction, this pre-selection is performed by the previous phase of the method [START_REF] Alves Junior | A KPI model for logistics partners´ search and suggestion to create virtual organizations[END_REF] involving a set of elements. In this work, considering VO reference foundations [START_REF] Camarinha-Matos | On reference models for collaborative networked organizations[END_REF], the so-called VO Manager is seen as the main decision-maker. The proposed method is generally presented in Figure 2. It splits the problem into two stages. It starts measuring the risks individually, for each of pre-selected LP, and after and based on that, collectively, for the entire LP team for the given VO. In this context, VO manager has a fundamental role, which is to define (with some degree of subjectivity) the minimal acceptable level (MAL) of risk for a LP to be member of a VO regarding CO's requirements and the strategic vision upon the VO. There is also a risk specialist, who is in charge of auditing the LPs' historical KPI values at the VBE's data repository.

Fig. 2. Risk Analysis model

The MRALP method itself is illustrated in Figure 3. Inspired in [START_REF] Mosleh | An integrated framework for identification, classification and assessment of aviation system hazards[END_REF], it divides the problem into two phases: the first phase does the individual risk analysis and applies ETA method for that. The second phase does the risk analysis taking the group of LPs as a whole into account, applying FTA method.

Individual Risk Analysis

In the first phase of MRALP an individual risk analysis for pre-selected LPs is performed. ETA is particularly suitable for risk analysis of systems where there are interactions between several types of probabilistic events, whether dependent or independent [START_REF] Ericson | Hazard Analysis Techniques for System Safety[END_REF]. It uses a visual representation based on a logical binary tree structure, known as Event Tree (ET), as shown in Figure 3 (Stage 1).

An ET is a probability tree which provides two possible conditions: success and failure. It also has three basic components: initiating event; intermediary events; and outcomes. The initiating event begins the ET creation process. In this work, the initiating event corresponds to one pre-selected LP, and the assigned probability is always 1 (or 100%) in the beginning [START_REF] Ericson | Hazard Analysis Techniques for System Safety[END_REF]. Next step consists in specifying the (four) intermediary events, which are represented by the (four) KPIs: trust, communication, collaboration and commitment. These events are used to quantify the effectiveness of a particular LP, i.e. if it is able or not to compose a VO.

These KPIs are used to generate an ET by assigning success and failure probabilities to each of them, as shown in Figure 3 (Stage 1). Inspired in [START_REF] Neely | Designing performance measures: a structured approach[END_REF], the criterion to assign the KPI success probability to each LP takes the historical values

Suggested LPs

Risk analysis process

Individual risk analysis

Collective Risk Analysis Level of risk VO Manager

Risk Specialist

Risk techniques and criterias

Risk analysis flow interactivity between the user and the method analysis of the KPI that were assigned to it in past VOs. The proposed method gets these KPI values and checks if they are greater than MPS (Minimum Probability of Success). MPS is a value that is also set up by the VO manager and represents the minimum probability of a KPI value to be within the considered acceptable range. For instance, in Figure 4, the value of the MPS related to the (intermediate event 'KPI_1') trust would have been set up as 0.3 (he also gives MPS values to the other three KPIs). In this figure, the VO manager would be stating that he accepts a global risk of 0,4 (MAL) and that the minimum level (of fail) for trust is 0,3 and so 0.7 for success.

The setting up of MAL and MPS are a bit subjective, and basically tries to make a trade-off between acceptable risk and effective performance situation of existing LPs. In the same line, each VBE can adopt a particular way of calculating every KPI, usually grouping a set of performance indicators at the operational level. In this case, the following understanding would be used by the given VBE´s partners when classifying their KPIs: [0.0 ; 0.2]: regrettable; [0.2 ; 0.4]: bad; [0.4 ; 0.6]: regular; [0.6 ; 0.8]: good; [0.8 ; 1.0]: superior.

Applying Equation 1 (see below), the KPI success probability is calculated for the current participation.

Fig. 3. MRALP method general example

The values assigned to each KPI can vary from 0 to 1 and are associated with a success rate between 0 and 1. Figure 4 shows a graph with hypothetic KPI values success) and must be analyzed to determine the logical connection between underlying failure events that might cause them.

FTA method takes the boolean values from ETA (first phase) as input (see Figure 3). An OR logic gate with entries is associated to each LP, meaning that the number of OR logic gates changes according to the number of LPs.

Resulting values from OR logic gates are aggregated to an AND logic gate, which verifies if all LPs are able to compose the VO. This gate returns 1 on success and 0 on failure, i.e., if at least one LP is not able to compose the VO, the VO formation process is considered unfeasible. On the contrary, if all members are considered able to, the VO as a whole is considered able to go for operation.

For this, it is necessary to perform a calculation with all elements of and, after that, to set a , which corresponds to the success/failure value of the association between the LPs (Equation 10).If then the VO formation is considered feasible from the risk analysis point of view. If not, that VO is discarded and the procedure is restarted with other LPs, i.e. with the other (possible) VO compositions.

⋀ 〈 〉 ( )

An Illustrative Example

This section presents an illustrative example to better show the proposed method. Suppose that a CO was created and three LPs ({ }) were selected to link four industrial partners (using the method developed in [START_REF] Alves Junior | A KPI model for logistics partners´ search and suggestion to create virtual organizations[END_REF]. The goal is to measure the risky of every selected possible LP coalition for the given VO. Following the proposed method, for each LP coalition the individual risk of every LP is firstly measured and the overall VO risk is calculated afterwards.

Considering size restrictions, the risk analysis that will be illustrated will only consider , with the final values of and arbitrarily defined. The assessment criteria of each LP are defined by a set of four KPIs: Trust ( ), Communication ( ), Collaboration ( ) and Commitment ( ). Table 1 shows hypothetical historical values that would be assigned to s KPIs related to its participation in the last seven VOs. Equation (1) calculates the success probability of these KPIs applying a MPS=0.6. In order to individually measure its risk level, is submitted to the first stage of MRALP method, applying ETA method. It should also consider the success and failure probabilities of each KPI that composes the intermediate events and then adding them as parameters in the ET. The ET graphical representation can be viewed

The second stage of the method consists in aggregating all the individual results from the LP group and in analyzing them as a whole. This is done using FT results as input to verify if that VO coalition, collectively, is feasible or not. Equation ( 9) is applied considering the provided values (Table 4) using the ( ):

( ) ( ) ( )
As explained in Section 3, considering that = 1, this would mean that the combination of those three logistic partners has an acceptable level of risk. Therefore, they could become members of the VO and hence the VO could be created.

Conclusions

This paper has presented a supporting method to perform a risk analysis upon a set of logistic partners (LP) that are going to compose -together with industrial partners -a Virtual Organization (VO). It corresponds to an extension of a previous work, which selected LPs but without considering risks. This method represents the result of an ongoing research which aims at last to develop a comprehensive framework for VO risk analysis.

The presented method, called MRALP, performs the risk analysis along two stages, firstly evaluating risks individually, per partner, and secondly at a global level. Four KPI are used as the essential basis for the selecting criteria, applying ETA (Event Tree Analysis) method in the first stage and FTA (Fault Tree Analysis) method in the second stage.

Although implemented in a controlled computing environment and with hypothetical values, the achieved results seemed promising about the suitability of the method regarding its purpose. Both ETA and FTA could model the required variables as long as it was needed besides being not much complex to use them.

Considering the state-of-the-art, the presented method proposed a concrete way to express to measure risks in a VO scenario when considering logistics. Yet, modeled as a process, it represents a systematic way to analyze risks. This is important once partners are autonomous and are members of long-term alliances so transparency in the involved processes is crucial for trust building. Moreover, being a more organized process, it has the potential to increase the agility in the VO formation process. On the other hand, it is assumed that a VO manager is the one responsible for the decision (i.e. the very final selection of LPs) as well as for actions aiming at mitigating risks, both in the creation and operation phases of the VO life cycle.

The four chosen KPIs (communication, commitment, trust and collaboration) to cope with risks in VO seem appropriate regarding literature. However, it is necessary to assess them in near-real scenarios, not only in terms if they are suitable enough or if more KPIs are required, but also to evaluate the complexity to implement them. Companies are often very much variable and this implementation also depends on the culture and working methods currently applied by the involved organizations.

Considering the combinatorial essence of the method, its computation can become overwhelming when dealing with very large global logistics chains, composed of tens of partners.

Although preliminary devoted to logistics and partners' selection problem, the method can be easily adapted to other application domains, basically changing the group of selected KPIs and the way they are calculated.

Next main steps include testing the method in near real scenarios as well as to extend it towards comprising the VO entirely, involving industrial partners. Besides that, a more detailed categorization of types of LPs (inbound and outbound as well as 4 PL) will help in a more precise definition of the most suitable LPs.

Table 1 .

 1 Quantitative values of KPIs according historical values of in VOs. (*) KPI values greater than MPS = 0.6 are considered in the risk analysis.

Acknowledgements

This work has been supported by the Brazilian and German research funding agencies Capes and DFG in the scope of the BRAGECRIM Program, project No. 2009/2. Also by the Brazilian research funding agency CNPq.

about trust associated to a LP, assuming it has participated in past VOs. Since represents the number of its previous participation in VOs and considering its KPIs values greater than MPS (with an '*'), Equation 1presents the KPI success rate.

( ) [START_REF] Mentzer | An efficiency/effectiveness approach to logistics performance analysis[END_REF] The failure rate for a given KPI is represented as ( ) by the following equation:

That success and failure calculation procedure is repeated for all KPIs that compose the ET for a LP. A set of probabilities representing the success and failure probability for each KPI is obtained as a result, which are presented in Figure 3 by the four intermediate (and independent from each other) events KPI_1:4 that populate the ET. Event KPI_2, for instance, would be related to KPI communication, with fail and success values of 0,4 and 0,6, respectively. After assigning all probabilities for all ET branches, it is necessary to identify if the LPs are minimally qualified to compose a VO. For this, a calculation is performed to obtain the final probabilities for all event combinations composing the ET. They are determined for each of the branches of ET and are got by multiplying the probabilities of events that compose each path. The results greater than MAL are then selected to be part of the Stage 2 of MRALP.

The above concepts can be formalized as follows: Let { } be a set of LPs previously selected, where each element in this set is associated with a different type of logistic activity that is being requested in a business. Let { } be a set of KPIs associated to a LP, and ( ) the probability function associated with each event in (as defined in Equation 1). ETA events occur independently, i.e., where the occurrence of an event does not affect the occurrence of other event. This situation can be represented by the equalities defined in Equation ( 3) and Equation ( 4):

Now consider { } as a set of all possible outcomes from the ET events combinations. The procedure for obtaining this set was performed using a binary search tree [START_REF] Vose | Risk Analysis: A quantitative analysis[END_REF], which travels different paths and assign a value to each element of , as shown in Equation ( 5):

The function , as shown in Equation ( 6), corresponds to a 4-dimensional vector which performs a binary search in the tree, returning a path element of each iteration. Values and correspond to the beginning and ending of the search, and have initial values of and . The value corresponds to the index of the sought element (an element of ) and , the current level of the tree. The sequence of events can be viewed in Figure 3 (Stage 1).

After defined all possible outputs for a LP and calculated their probabilities, the method applies a constraint variable , which checks if its value is greater than or equal to MAL for each element of . Only the results that are greater than MAL are considered, and the other are discarded. Thus, { } is a subset of P:

The final probability values obtained through Equation ( 7) will be used to measure and analyze the LP's risk. Consider the risk level of a LP defined by a pair 〈 〉. represents a condition of the LP to compose a VO (using boolean logic), while represents the success probability of the LP associated with the condition R. So 〈 〉 for the i-th selected LP and the i-th is the score associated with the ith result . is calculated checking if set has some element (Equation ( 8)), i.e. if there is at least one outcome value greater than MAL. A value 1 corresponds to the presence of elements so enabling the to compose a VO. (Equation ( 9)) is calculated summing all elements of , obtaining the success probability rate for a LP.

Collective Risk Analysis

This second phase of the MRALP method aggregates the results provided by the first phase (i.e. the risk level of each pre-selected LPs) to calculate the VO success probability as a whole, i.e. if the VO formation can succeed or not. This phase applies FTA (fault tree analysis) method [START_REF] Vose | Risk Analysis: A quantitative analysis[END_REF]. FTA uses a logical diagram-called Fault Tree (FT) -which is a graphical representation of failure events logic that can occur in a system among all other possible event combinations. The graphical model can be translated into boolean logic using logical gates to calculate failures. Events are associated with input lines from the logic ports (0-failure, 1-in Figure 3 (Stage 1). According to Table 1, using Equations ( 1) and ( 2) and considering, for example, MPS = 0.6, the success and failure probabilities associated with each KPI are calculated (Table 2) and the respective ET is formed.

Let { } be a set of all combinations among , , , and, for example, MAL = 0.1. Table 3 presents this result after applying Equation 5. It represents the combinations of , corresponding to all the probabilities (sixteen) associated with each event.

Next step consists in assigning a S score and a R boolean result for the (Equations ( 8) and ( 9)). A constraint Q = {0.3, 0.15, 0.12} is defined (Equation ( 7)), corresponding to the probabilities of values to be greater than MAL.


Morice Daudi

Simon Samwel Msanjila
email: smsanjila@mzumbe.ac.tz

Modeling of Evolution and Sustainability of Rational Trust in Dynamic VOs

Keywords: trust evolution, trust sustainability, VO, trust modeling

Modeling of trust sustainability and evolution among partners of a dynamic Virtual Organizations (VO) whose collaboration is already established, poses high challenge to such virtual co-working environment. Research in VOs has not established suitable modeling approaches for analyzing evolution and sustainability of rational trust and related assessment mechanisms for the collaboration which is already in progress. This is very necessary as it has now been proved that the base trust level acquired by VO partners during the VO formation is not static and cannot to remain constant over entire period of collaborative business execution. Thus proper modeling and analysis approaches for measuring the continuous changing of trustworthiness of organization need to be developed. This paper proposes approaches and mechanisms for modeling and assessment mechanism for supporting interorganizational trust sustainability and evolution.

Introduction

In traditional business undertakings, organizations tend to struggle and win business opportunity individually. Nowadays, SME organizations in particular are less and less capable to afford acquiring and executing business opportunities individually, and now a new form of working in cooperation networks is being adopted [START_REF] Msanjila | Trust analysis and assessment in virtual organization breeding environments[END_REF]. The emerging approach which is now being adopted by collaborating organizations is Virtual Organizations (VO) which are configured constituting organization that are members of a long-term strategic alliance. Dynamic VOs which are mostly preferred are those temporary consortiums whose structure and particularly partners may change during the collaboration. The VOs characteristics include tendency of organizations to create "virtual size" by becoming partners but at the same time trying to preserve the flexibility of small companies (Riemer et al., 2001); and there is no leading or subordinate" (Appel & Behr, 1996).

Smooth operation of the VO needs to be supported with rational trust among the partners to provide a bonding factor and a glue to stick these partners together. Established inter-organizational trust through rational mechanisms is used to enhance partner's confidence that a specific member of the VO can execute its assigned roles appropriately to collaboratively achieve the common goal(s). Despite the different and opposing perception of trust, we perceive trust in VO, which only rational trust is suitable to apply, as the objective-specific confidence of a trustor in a trustee, based on the results of rational (fact-based) assessment of trust level of the trustee [START_REF] Msanjila | On Inter-organizational Trust Engineering in Networked Collaborations: Modeling and Management of Rational Trust[END_REF]. The main input into trust analysis is measurable organization's performance.

Organizations collaborate in the VO for a number of reasons including saving time and decreasing development process, sharing costs and risks with partners, improving resource utilization, and gain access to new markets through partnership (Nami and Malekpour, 2008). Although, it is clear regarding its urgency, trust of the VO partner does not remain static, but varies depending on many influencing factors including comparative nature. Since the level of trust for an organization is dynamic and evolves over time, then comprehensive approaches for managing rational trust in VOs whose collaboration is already in progress is important. It is because, with a rising number of relationships and especially short-time relationships, as needed in VOs, conventional approach to build trust among business partners has proven to be inefficient [START_REF] Wehmeyer | Trust-building potential of coordination Roles in virtual organizations[END_REF]. Scientific mechanisms for modeling trust sustainability and supporting for a VO evolution are needed so that VOs remain bonded to achieve their goals and undergo evolution when required.

This paper describes classification of trust (section 2), presents approaches and mechanisms for modeling and assessment of rational trust (section 3), suitable for analysis of inter-organizational trust sustainability and evolution.

Classification of Trust

Trust can be classified in two aspects, namely; (1) Subjective trust, and (2) Objective trust. In the past, trust used to be perceived as subjective (opinion-based); posing difficulties in its evaluation and formal reasoning on analysis of its results, due to the use of opinion-based data, thus being risky as it is biased [START_REF] Msanjila | Engineering the Evolution of Organizational Trust in Operating Virtual Organization International Journal of the Academy of Organizational Behavior Management[END_REF]). In subjective trust, a trustee is evaluated based on opinions, suggestions, and recommendations and sometimes polling. It is a biased trust and very difficult to reason about its results. Measurement and assessment of the subjective trust provides questionable results for a VBE/VO member to be trusted, because data sources are not properly characterized and are difficult to factually measure.

Objective trust is the results of the rational (fact-based) assessment of the trust level [START_REF] Msanjila | Trust analysis and assessment in virtual organization breeding environments[END_REF]. It is the trust whose assessment is based on organizational performance data (fact-based), and provides results which an individual can reason about. Trust in the past was measured statically and did not consider the variation of trustworthiness with time. Such dynamic behavior of trust level accounts for existence of Trust Sustainability and Trust Evolution. Trust sustainability is the process whereby a VO partner maintains their trustworthiness to the specific trust level to enable it remains acceptable in the VO during execution of the activities that lead into achieving the common goal of their collaboration [START_REF] Msanjila | Engineering the Evolution of Organizational Trust in Operating Virtual Organization International Journal of the Academy of Organizational Behavior Management[END_REF]. Each VO partner has to maintain its trust level above the acceptable value, namely the required specific trust level for the VO. If the trust level falls below the specific trust level of the VO then the said VO partner cannot be trusted and its capacity to execute its assigned roles shall be doubtable. When such an organization fails to sustain its level of trust, the VO undergoes evolution from which new VO partners are selected from VBE to fill the gap of departing partner with poor trust.

When new partners are added in the VO naturally trust level of others will change because of the comparative analysis and measurement applied. This process is referred to as trust evolution. When new member(s) are added in a VO, there will be a change on an average trust level of the VO, which implies trust evolution.

Trust Evolution Assessment Mechanism

In research there is still lack of suitable mechanisms for the assessment of rational trust of collaborating VO partners. Mechanisms for assessing rational trust during the selection of VO partners measure the basic trust level. These mechanisms cannot be applied to assess trust in already existing consortiums, because trust level is not static but changes with time. Current mechanisms for assessing rational trust consider trust level at a specific point in time (static assessment). These mechanisms do not address the evolution of trust with time and thus assumes trustworthiness of organizations is static once measured. This has proven to be not the case and therefore mechanism for assessing evolving trust level of organizations are required as proposed in this paper.

The assessment mechanisms that can support trust sustainability and evolution among partners collaborating in VO over entire period of business execution as proposed in this paper are modeled based on performance acquired or achieved by the partners in the specific VO. The proposed models are developed applying statistics concepts that can capture variation measures with time. The statistics concepts, namely: (1) measure of central tendency (mean) and ( 2) dispersion (mean deviation and standard deviation) are applied to develop mechanisms to capture the evolution of trust in VO partners. In the subsequent subsection three (3) rational trust assessment mechanisms discussed in detail, and finally a best-to-fit model is proposed. In each presented model, the following assumptions are made: Base period: Is a specific interval time (monthly, quarterly, semi-annually, and annually) which is considered to be a period for assessment base trust level of VO partner. Base trust level: The trust level acquired by a VO partner at specific point in time.

First-Level Model: Mean Estimation

This approach considers mean estimation for trust level of VO partners in a given period [START_REF] Msanjila | Trust analysis and assessment in virtual organization breeding environments[END_REF]. The mean trust level estimated at current period becomes the target score for which every member's trust level should not fall below the threshold in the next period. For example if the base period is assumed to be quarterly, then mean trust level is computed using trust level of individual partner. After a lapse of three (3) months, the new acquired trust level for each VO partner is compared against that mean trust level to find if it is less than, equal to or greater than mean trust level at such current period (refer figure 1 and figure 2). Mean trust level is calculated as Where Xi is a trust level and n is the number of VO partners participating in the VO. In figure 1, M stands for a VO partner while TL stands for Trust Level of the partner. It may happen that the mean trust level be above of some levels of trust of some VO partners at a given period (figure 1). In such situation: (1) Fair play to some of the partners (M 3 ) is ignored, but favoring partners whose trust values were high (M 1 , M 2 , M 4 , M 5, M 6 ) during the base assessment period and (2) Assessment does not provide a target point for a particular partner, looks at a single point for all member to achieve. The impact of this assessment includes: (1) Partners whose trust levels are below mean estimated trust value are deprived of a fair chance to build trust over others; (2) Partners whose trust level scores are above mean estimated level have greater confidence to build trust over others; (3) The model does not give a range for variation in trust level, rather aims at single point and ( 4) The mechanism has a narrow space for trust variation limits. This model is suitable for discovering partners whose levels of trust have fallen below specific VO's mean trust level for removing underperforming partners and replace them with other new partners (figure 2).

Second-Level Model: Mean Deviation

The mean deviation (average deviation) is the mean of the absolute deviations of observations from some suitable average which may be the arithmetic mean, the median or the mode. The difference (how far is each data from the average) between a specific data and the average itself, is called deviation. Considering arithmetic mean for this model, mean deviation is the average of how far is each individual data element from the mean. This difference is given by the following formula.

If the negative sign is ignored, the deviation is written as and is read as mod deviation. For ungrouped data, mean deviation is given by where X i is a VO partner's trust level, X mean is a mean trust level and n is the number of VO partners participating. This model considers trust level for each partner as data sets for computing mean trust level for VO, which is denoted as X mean . Then individual deviation for each VO partner is computed as illustrated in equation 2 and further in equation 3. The mean trust level for all VO partners is computed during the base period. 4). After a lapse of agreed period (say, semi-annual), each individual VO partner's trust level is assessed and compared to see if it range between and above or has fallen below . If the trust level of a particular VO partner is found to range below X mean , then such specific partner is said to fail to sustain its trust level and therefore it is less trustworthy. This is a better model as compared to mean estimation one, because it targets to a range of values (refer figure 3 and figure 4) which is somehow easy to achieve than targeting to a single value which is obviously hard to make. Since deviation is given as absolute value, it is always positive. It does not reflect whether such deviation in trust level was of decrease or increase (figure 3). Though the model creates a customized space for interval limit in trust value for each individual VO partner; the space appears to be biased in one direction. The deviation is an absolute value which is always positive, so that space for interval limit is given by . Its limitations include providing space for trust level limits only in one direction but also it is not standard for all VO partners participating. This approach is very suitable when there is a large set of organizations from which a few need to remain in a VO and thus all those organizations whose trust level has fallen will be first dropped.

Third-Level Model: Standard Deviation

Standard deviation model is a statistical method useful in determining how far is the data spread out in a particular sample or population, and how individual data are close to the mean. This value gives information on how the values of the data set are varying, or deviating, from the mean of the data set. The statistical assessment mechanism which is standard and able to cater for overall weaknesses of both, mean estimation and mean deviation models is a standard deviation model. It requires calculation of trust variation range (Figure 5) based on standard deviation of trust level given by Since standard deviation may be positive or negative, then the range for trust value becomes acceptable within the range V mean -V SD to V mean + V SD . With this model, space interval limits in both directions exists, with their width twice the standard deviation. Since the width is standard, a VO partner becomes equipped with wide space to allow variation in trust level. Such VO partner's individual trust level can vary within its customized acceptable limits evaluated based on its own capacity determined by its current period's trust level to be assessed in the next period. This means, if the VO partner's trust level is within the range, such VO partner has succeeded to strive for its existence and maintained its trust level. If the trust level shoots down below the acceptable minimum trust level, it is said to fail to comply with agreed trust range. The model works by calculating first the mean trust value for all the available VO partners, as Then, it calculates population variance of the trust values based on mean trust value denoted by V variance , as Finally, the model calculates standard deviation for trust level denoted by VSD, as Since the standard deviation for trust values may be positive or negative, this implies that it provides an interval of twice standard deviation for which the trust levels variation is allowed. Mathematically, standard deviation measures how widely spread data points are from the mean (refer Figure 6). If more proportion of trust level for the individual VO partners are very close or near to the mean, standard deviation becomes very small number. Since an experiment that yields data with a low standard deviation is said to have high precision, this implies strong bonding among VO partners and VO collaboration is assured. On the other hand, if a high proportion of trust levels lay far from the mean trust level, then the standard deviation is large, and as such the experiment that yields data with a high standard deviation is said to have low precision. This implies creation of gaps in levels of trust, and consequently weakens collaborative bonds. A score below minimum acceptable range signifies that such particular VO partner threatens and weakens bonding factor and hence affects collaboration. Thus, the partner cannot be trusted any more by other partners in achieving common and shared goals. It is important to think about replacing a failed partner by selecting another member from VBE to join the VO. In such environment, the VO is said to evolve. The implementation of the standard deviation model, employing real case example with real indicators, was done in Trust Sustainability and Evolution (TrustSEv) system; which is not part of this paper.

4

This paper has presented models that can be applied to develop approaches for rational trust assessment in VO whose collaboration is already in progress. The VO partners need to sustain their levels of trust and undergo evolution if need arises. Since the assessment model for trust assessment during VO formation is insufficient to address trust evolution during VO operations, then devising new approach is promising. The paper has compared three statistical models namely; mean estimation, mean deviation and standard deviation that each is suitable for different cases. The mean estimation is suitable for dropping partners whose performance in terms of trust level is below the mean.

Fig. 1 :

 1 Fig. 1: Trust assessment by mean estimation method

Fig. 2 :

 2 Fig. 2: Linear presentation of cut-off point in the statistical mean estimation method

Fig. 3 :

 3 Fig. 3: Trust assessment by mean deviation method

Fig. 4 :

 4 Fig. 4: Linear presentation of VO member's trustworthiness by mean deviation method

Fig. 5 :

 5 Fig. 5: Model for Trust Sustainability and Evolution Support

Fig. 6 :

 6 Fig. 6: Range of Trust Values Variation


Jyotirmoyee Bhattacharjya
email: jyotirmoyee.bhattacharjya@sydney.edu.au

Peter Kleine-Moellhoff
email: peter.kleine-moellhoff@reutlingen-university.de

Environmental Concerns in the Design and Management of Pallets

Keywords: Pallet life cycle, pallet management, environmental sustainability, stakeholder theory

Planning for sustainable reindustrialization necessitates considerations for environmentally sustainable production processes, packaging and logistics. Pallets are essential for the movement of goods around the world. Millions of pallets enter the global supply chain every year and are used, reused and either discarded or recycled. Since billions of pallets of different types are in use at any time, minimization of overall environmental impacts can be achieved only through process improvements and careful consideration of pallet types for various activities. The paper reviews the current management practices with respect to pallets and identifies issues in different points of the life cycle.

Introduction

A recent observation by John Mead, the previous Chair of the International Organization for Standardization (ISO) Technical Committee (TC) 51, Pallets for unit load method of material handling, provides an useful context for the discussion in this paper: "Although pallets are largely taken for granted, these humble, flat, structures can be said to form one of the basic blocks of global supply chains. Billions are currently in existence, a mark of confidence based on 50 years of worldwide experience" ( [START_REF] Mead | Reliable pallets -Carrying world trade on their backs, ISO Focus+[END_REF], p. 18). His comments highlight two important issues that have an impact on resource scarcity and sustainable landfill usage considerations: pallets are an indispensible component of global trade and millions of pallets enter the global supply chain every year. As various arguments over the environmental impacts of different types of pallets and management practices continue to rage within the pallet industry, there appears to be a growing volume of information in support of all sides of these arguments. Practitioner driven pallet life cycle assessments have served to add more confusion to these arguments. However, there is limited independent academic research that could provide some informed guidance for business decision makers. While there has been a recent attempt at modeling the cost and environmental trade-off for companies when selecting pallets [START_REF] Bilbao | On the environmental impacts of pallet management operations[END_REF], the model does not address the complexity of relationships between various stakeholders and the diversity of conditions influencing pallet choice and usage practices. In practice such choices may be driven by the regulatory environment and the dominant exchange/ pooling services in the region, and there may be a range of issues associated with subsequent management practices. This paper outlines key practices around the globe in relation to different stages of the pallet life cycle and discusses their environmental implications while highlighting the roles played by different stakeholders.

The Pallet Life Cycle and Environmental Concerns

Pallet Design and Manufacturing

Pallet design and associated innovation needs to be guided by the needs of key players along the supply chain. In essence, a shipper's choice of pallet is informed by the weight of the product, the environment through which a product will travel and the types of vehicles that will be involved in moving the pallet load [START_REF] Witt | Flame-retardant pallets[END_REF]. A pallet buyer must also consider the standard pallet sizes used in a particular industry and in different international destinations [START_REF] Forcinio | Packaging Forum: Particulate-Free Pallets[END_REF]. To facilitate shipping between major trading regions, ISO/TC 51 has defined six sizes of pallets in the standard ISO 6780:2003, Flat pallets for intercontinental materials handling -Principal dimensions and tolerance [START_REF] Mead | Reliable pallets -Carrying world trade on their backs, ISO Focus+[END_REF]. Thus evolution in pallet manufacturing has involved the adoption of a variety of materials and designs.

Pallet buyers are faced with an increasing number of options whose environmental impacts need careful consideration. Wood (see Fig. 1) remains the material of choice for pallet design (estimated to be used in over 90% of applications around the globe) but plastic pallets have been gaining in popularity because of their durability and light weight [START_REF] Mead | Reliable pallets -Carrying world trade on their backs, ISO Focus+[END_REF]. A debate continues to rage over whether wood (which requires the felling of trees) or plastic (created from a non-renewable resource) is the more eco-friendly raw material [START_REF] Lacefield | How green are your pallets? DC Velocity[END_REF]. However, wooden pallets are seen to have an advantage over plastic in terms of the carbon dioxide emissions during the manufacturing process. There are other considerations in the wood versus plastic debate. The requirements outlined in the International Standard for Phytosanitary Measures 15 (ISPM 15) imply additional costs for shippers with the inclusion of processes such as heat treatment or fumigation of wooden pallets [START_REF] Grande | Plastic Pallets Gain Ground in an Eco-Conscious World[END_REF]. This makes plastic pallets an attractive option for shipping time-sensitive products which could be affected by delays in the certification of wooden pallets. As more buyers consider plastic pallets, there is likely to be an increased focus on the flame retardant capabilities of these pallets and the adequacy of sprinkler systems in existing warehouses [START_REF] Witt | Flame-retardant pallets[END_REF]. However, chemicals added to give plastic pallets their flame retardant quality may turn out to be toxic in nature. The plastic pallet company, Intelligent Global Pooling Systems (iGPS), for instance, recently reached a voluntary agreement with the US Environmental Protection Agency (EPA) to end the use of the chemical decabromodiphenyl ether (DecaBDE) as a flame retardant in its pallets over a period of three to four years [START_REF] Harrington | Plastic pallet company defiant in face of DecaBDE phase-out pact[END_REF]. The EPA was concerned by the persistent and toxic nature of the chemical and the possibility of it leaching into food carried by iGPS pallets. The cost and shortage of wood in Asian countries have also led to an examination of other options [START_REF] Mead | Reliable pallets -Carrying world trade on their backs, ISO Focus+[END_REF]. Corrugated paper pallets for lighter loads and pallets made from reconstituted wood are other options. Lightweight aluminium pallets have also become a reliable option. The arguments in favor of steel pallets that are coated to prevent rusting are similar to those for aluminum pallets: light weight, durability and recyclability at the end of a multiyear life [START_REF] Forcinio | Packaging Forum: Particulate-Free Pallets[END_REF].

The Working Life of a Pallet -Pallet Use, Reuse and Repair

Pallets may be custom sized according to user requirements and designed for singleload use [START_REF] Mead | Reliable pallets -Carrying world trade on their backs, ISO Focus+[END_REF]. However, the reuse of general purpose pallets is a more cost-effective and environmentally sustainable solution. While both wooden and plastic pallets can be repaired several times during their working life, the former are easier to repair [START_REF] Lacefield | How green are your pallets? DC Velocity[END_REF]. The ISO standard (ISO 18613:2003) specifies the maximum defects allowed before a flat wooden pallet needs to be repaired; however, the responsibility for carrying out appropriate inspection processes and ensuring the safety of reused pallets lies with companies that maintain pallet pools [START_REF] Mead | Reliable pallets -Carrying world trade on their backs, ISO Focus+[END_REF]. A range of practices have been developed across the globe in relation to pallet reuse.

Pallet use and reuse may occur between members of a designated industry group in a particular country or region. In the US, the Grocery Manufacturers Association (GMA) exchange pallets that constantly circulate between various owners with the ownership of a pallet being transferred with the product load [START_REF] Associates | Life cycle inventory of wood pallet systems -Final summary report[END_REF]. In Canada, the Canadian Pallet Council (CPC) provides a pallet exchange system (a pool of about seven million distinctive orange hardwood pallets) for its 1200 pallet-user members. While initially created in 1977 on the basis of pallet ownership, the CPC now provides pallet rental, repair and retrieval services through its pallet industry members. Its services also include the provision of online asset management tools. In Europe, the European Pallet Association (EPAL) was formed in 1991to maintain a Europe-wide exchange wooden pallet pool for the European Railways. Its membership includes users, producers, dealers, repairers and transporters. It undertakes regular inspection of pallets produced by EPAL licensed manufacturers.

Pallet reuse may sometimes be facilitated through partnerships between individual companies with different core capabilities The UK based building materials provider, CEMEX addressed the need for reuse by forming an alliance with packaging specialists European Logistics Management to ensure the collection, repair and return of pallets. Without such an arrangement these pallets would either have to be thrown or shredded. From the perspective of both CEMEX and its customers there were financial benefits from the implementation of such a system. The cost of wooden pallets had risen by 15% in 2007 and 20% in 2008 and the landfill tippage charges were increasing as well [START_REF]CEMEX: 20% of pallets returned in first year of CEMEX's pallet retrieval scheme[END_REF]. By the end of the first year the company claimed to have recovered 20% of the 250,000 pallets sent out to customers.

With the growth of pallet pooling services, it has become less of a necessity for suppliers/ manufacturers to buy and own their own pools. Pallet pooling service providers such as CHEP, iGPS and Loscam provide similar services which involve issuing pallets to manufacturers or growers, collection of empty pallets from downstream supply chain partners and performing inspections and repairs of the returned pallets. The pooling process has its share of problems as highlighted by this recent court case in Australia between the hardware chain Bunnings Warehouse and CHEP Australia : "In May 2010, Justice McDougall in the Supreme Court of New South Wales ordered Bunnings to pay $11 million in damages to Chep for conversion and detinue of 64,690 pallets it had unlawfully detained over a five year period……This is despite the fact that during that entire time, a customer of Chep (whomever that may be) was paying hire charges for precisely the same pallets" [START_REF] Andrews | Pallet Hire Mystery Victoria Transport Association Inc[END_REF]. Inadequate auditing of pallets remains a common occurrence within the pallet hire industry in Australia. As illustrated by the judgement in favour of CHEP, such incidents can prove to be quite costly for pallet hirers and companies that exchange pallets with them in the course of their normal business processes. John Stuart, owner of the Melbourne based consultancy firm Pallet Loss Prevention Pty Ltd, aptly summarizes the problem: "If someone doesn't transfer their pallets off their account into your account, they will lose them… Pallet controllers on the receiving end can see that they haven't put their transfers through. Standard practice at the moment is not to tell them because everybody is losing pallets, so they can't afford to tell anybody else… Pallets are like a black art. People don't understand how easy it is to lose pallets. When you lose pallets, if you don't realize, they keep on paying and paying the hire charges, in the hope they will get them back, and they don't" ( [START_REF] Gregory | Preventive Measures: Avoid Pallet Loss[END_REF], p. 89). Although hire agreements are in place between pallet hire companies and hirers in Australia, the application of these agreements in the practices of companies that use hired pallets when conducting business with each other is fairly limited. The Pallet Hire Industry Code of Conduct (2010) has recently been developed for the local industry in Australia but this is voluntary. The use of appropriate software packages, much greater emphasis on the development of adequate internal policies and procedures for pallet control, better relationships between pallet controllers in adjacent companies in the supply chain and appropriate training for truck drivers transporting the pallets have all been suggested as potential solutions for addressing this problem [START_REF] Gregory | Preventive Measures: Avoid Pallet Loss[END_REF]. In essence, for pallet pooling to continue to be an environmentally sustainable solution it needs to remain a cost effective option for different players in the supply chain. However, the right combination of people, process and technology in this context still appears to be eluding many companies.

The Working Life of a Pallet -Transportation

The more durable the pallet, the more trips it can make during its lifetime. While manufacturers of plastic pallets claim these are more durable than wooden ones [START_REF] Schiavo | A pallet for every taste, Frozen Food Age[END_REF] and others highlight the durability of aluminium and steel pallets (e.g., [START_REF] Forcinio | Packaging Forum: Particulate-Free Pallets[END_REF]), there is a lack of independent estimates regarding the number of trips that can be handled by pallets built from different materials. The fact that these pallets may be used for very different purposes also makes the comparison a complex issue. Two key sides of the debate iGPS (leading plastic pallets pooling service) and CHEP (leading wooden pallet pooling service) continue to disagree over the number of trips that their respective pallets can handle [START_REF] Lacefield | How green are your pallets? DC Velocity[END_REF]. A significant issue in relation to pallet transportation is the weight of the pallet. It is argued that the transportation of plastic pallets requires the consumption of less diesel fuel since these pallets generally weigh only about half as much as wood ones. Apart from transportation needs associated with the working life of a pallet, the repair and reuse of pallets, discussed in the previous section, also implies the need for transportation of damaged pallets to repair locations and hence additional fuel consumption. CHEP claims to have minimized greenhouse gas emissions from repair related pallet transportation in the US by building service centres close to where their customers use these pallets [START_REF] Lacefield | How green are your pallets? DC Velocity[END_REF]. However, there is inadequate research regarding the practices of pallet related service providers around the globe.

Pallet End-of-Life

There are issues to consider in managing end-of-life related issues as well. The disposal of plastic pallets is also problematic as plastic is not biodegradable and emits methane gas when it starts to decompose [START_REF] Lacefield | How green are your pallets? DC Velocity[END_REF]. While wood does not have the same problem, landfill disposal of wooden pallets has become an unwelcome practice across many states and municipalities in the US (e.g., Buehlmann, et al., 2009). Recycling is increasingly seen as the acceptable option. Wooden, plastic, aluminium and steel pallets can all be recycled ([4]; [START_REF] Lacefield | How green are your pallets? DC Velocity[END_REF]). A damaged wooden pallet can be used ground up and used to produce mulch or animal bedding. A plastic one can also be melted to produce a new plastic pallet, but there is an energy cost associated with this process. Recyclability brings other problems with it as well. Between November 2010 and May 2011 the Los Angeles County Sheriff's department has been reported to have recovered US$1.3 million in stolen pallets and reusable packaging [START_REF] Leblanc | 1.3 million in stolen reusable packaging and pallets recovered in Los Angeles -A $10 million annual problem[END_REF]. Such thefts have been attributed to factors such as the lack of adequate security in larger stores and inadequate secure storage space in smaller ones and have been estimated to have cost businesses in the San Gabriel Valley around US$10 million per year. These incidents have led to lawsuits against some recyclers and highlighted the need for law enforcement authorities to work with recyclers to prevent the purchase of stolen plastics. This also suggests that the point at which a pallet is recycled may depend on issues other than ISO standards and inspection processes of pallet owners. While theft results in an obvious cost for businesses from which they are stolen, the repeated recycling of pallets has significant energy costs associated with it as well. These issues suggest the need for further research into the implementation of end-of-life solutions for different types of pallet in the context of business practices in different industry sectors, law enforcement and regulatory environments.

Pallet Life Cycle Assessments

Both CHEP and iGPS provide online calculators in a bid to assure customers of their green credentials. Both have commissioned studies by independent consultancy firms to make their respective cases. The report developed by Franklin Associates for CHEP concluded that CHEP's pallet pooling systems "produce much less production waste and recycling/disposal waste than exchange and one-way systems because of the high material efficiencies and controlled end-of-life management for CHEP pallets" ( [START_REF] Associates | Life cycle inventory of wood pallet systems -Final summary report[END_REF], p. ES-5). Another life cycle assessment by consultancy firm Environmental Resources Management for iGPS concluded that, "iGPS plastic pallet had lower environmental impacts in all impact categories compared to the typical pooled wooden pallet, and a substantially smaller environmental footprint than the single-use pallet" ( [START_REF]Streamlined life cycle assessment of iGPS, 15. typical pooled wooden pallets, and single use wooden pallets[END_REF], p. ii). A subsequent study by CHEP in 2009 suggested that wooden pallets perform better than their plastic counterparts in relation to the generation of solid waste, energy consumption and greenhouse gas emission [START_REF] Brindley | Life Cycle Analysis Underscores Environmental Challenges of Plastic Pallets[END_REF]. Clearly, independent studies which take into account a broader range of pallet types as well as industry and country/region specific pallet management practices could help to provide some clarity and better inform the decisions made by pallet hirers/owners.

A Stakeholder Theory Perspective

A useful theoretical perspective in this context is stakeholder theory which is built on the premise that effective firms need to manage all relationships that affect or are affected by the achievement of the objectives of the organization [START_REF] Freeman | Strategic Management: A stakeholder approach[END_REF]. Broadening Freeman's [START_REF] Freeman | Strategic Management: A stakeholder approach[END_REF] original conceptualization, Clarkson [START_REF] Clarkson | A stakeholder framework for analysing and evaluating corporate social performance[END_REF] defines the concept of primary stakeholders as: "Primary stakeholder groups typically are comprised of shareholders and investors, employees, customers, and suppliers, together with what is defined as the public stakeholder group: the government and communities that provide infrastructure and markets, whose laws and regulations must be obeyed, and to whom taxes and other obligations may be due" (p. 106). Stakeholder groups have been classified in a number of different ways in relation to issues such as power, dependence, reciprocity, legitimacy and actual and potential relationships. Synthesizing the relevant literature, Mitchell et al. [START_REF] Mitchell | Toward a theory of stakeholder identification and salience: Defining the principle of who and what really counts[END_REF] provide a comprehensive classification which identifies the following types of firm-stakeholder relationships: a firm and a stakeholder are in a non-trivial relationship (potentially of a transactional nature); stakeholder is dominant; firm is dominant; stakeholder and firm are mutually dependent; stakeholder and firm are in a contractual relationship (the contract is the basis for legitimacy); and stakeholder has an interest in the firm (legitimacy is not implied). While the development of stakeholder theory has taken a number of directions, the basic ideas of the influence of stakeholders on the firm and vice versa and the classification of different stakeholder groups could provide useful lenses for examining activities of different organizations involved in the life cycle of a pallet. Wal-Mart, for example, requires its globally distributed suppliers to complete a sustainability assessment [START_REF] Bair | Why Walmart's better supplier scorecard is a big deal[END_REF]. However, the impact on the pallet management practices of upstream supply chain partners based on the environmental sustainability requirements of downstream players requires further research. Practices of government agencies around the globe are likely to vary from those of the EPA as well.

Pallet life cycle assessment appears to be an area where further work is required beyond the claims and counterclaims of dominant pooling services. Stakeholder influences on life cycle assessments has recently been discussed in the research literature in the context of oil and gas and agricultural biotechnology [START_REF] Matos | Integrating sustainable development in the supply chain: The case of life cycle assessment in oil and gas and agricultural biotechnology[END_REF]. Similar considerations for greater stakeholder engagement could potentially enrich the analysis of pallet life cycles. Furthermore, broadening the concept of life cycle assessment to economic-ecological efficiency analysis and incorporating both environmental impact and costs/value added could provide greater value for pallet hirers.

Discussions

This paper highlights key practices and sustainability issues in the management of the pallet life cycle around the globe. While the diversity in pallet life cycle management practices poses many challenges, it presents a great opportunity for researchers to identify solutions that are sustainable in the long term. The authors are currently involved in modeling environmental impacts for different pallet types based on current pallet life cycle management practices and a number of data sources. The outcomes of the modeling exercise will be presented at the conference.

Fig. 1 .

 1 Fig. 1. A single-use wooden pallet (European size: 1200 mm X 800 mm X 150 mm). (Source: Second Author)