Automated negotiation in multi-agent based e-business

Negotiation is one of the most important activities for organisations in conducting electronic business. Traditional purchasing and selling have been conducted through complex processes involving negotiation that includes coordination and cooperation. To conduct automated negotiation for electronic business, a multi-agent system is needed where agents interact with each other. To perform this activity effectively and efficiently agents need to be able to negotiate, coordinate and cooperate with each other within the system. The research detailed in this thesis investigated the negotiation process in business-to business (B2B) transactions in supply chain management for multi-agent based electronic business (e business). Specifically, it answers the following research question: How can the negotiation process in B2B transactions be formulated and applied in multi-agent based e-business? The research strategy utilized an exploratory case study framework, with methods from decision theory, game theory, fuzzy logic and simulation for analysis. A series of integrated studies were undertaken to develop: an automated negotiation protocol; negotiation strategies; and a coordination and cooperation model. These were analysed in the context of the case study, Trading Agent Competition Supply Chain Management (TAC SCM) game scenario. Currently, the TAC SCM is the only international competition involving an electronic marketplace (e market). The studies involved the negotiation strategy between two agents, where the agents will be able to solve a problem by finding the best feasible strategy to bind an agreement for negotiation. By adopting a maximin and minimax strategy, this research proposes that agents will reach a reasonable positive intention approach towards negotiation, and will increase the agreement binding rate. A negotiation strategy was also examined by Fuzzy Logic using possibility theory and linguistic variables in which it also proposes a negotiation strategy in an uncertain situation for the TAC SCM. This will aid in binding the agreement to achieve the agent?s expected profit. Next, this research reviewed the TAC SCM game and explored the procurement performance of agents.The monotonic concession negotiation protocol, which determines the rules in which the agents can offer and counter-offer in the negotiation process was investigated. The author proposes two types of protocols. The first protocol is a Non-Monotonic Protocol with theoretical analysis. The second protocol is an Extended and Flexible Iterated Negotiation Process. This research also developed an Extended Bilateral Negotiation Model based on OMG (1999). The Negotiation Mechanism involving Offering and Counter-Offering models were also developed. Next, this research reviewed the cooperation and coordination process. This study identified problems in conducting e-business and supply chain management and expected benefits for supply chains with agents working together in coordinated and cooperative processes. The utilization of the multi-agent system in supply chain management with the Enhanced and Effective Cooperative Processing Stages is discussed. To apply these stages, the author proposes an architecture of Effective Cooperative Processing for Agents, and some characteristics in modelling coordination and cooperation for TAC SCM have been outlined. The research detailed how the negotiation process in B2B transactions can be formulated and applied in multi-agent based e-business. Through the proposal of a Flexible and Iterated Negotiation Framework, consisting of an Extended Bilateral Negotiation Model and a Cooperation and Coordination Model, the research community moves further towards the ultimate goal of an efficient, economic and automated negotiation process. In summary, the main contributions of the thesis include: a theoretical analysis of the negotiation process with coordination and cooperation; proposed models for an automated negotiation process; development of strategies and protocols for automated negotiation; and the coordination and cooperation model that can be used not only in supply chain management but also in any type of e-business.