Changes in a Service Oriented Enterprise: A Game Theory Approach

Service Oriented Enterprises (SOEs) are subject to constant change and variation. In this paper, the changes are considered from an economic perspective based on service culture notion. Once a change is implemented, the costs of some member services may increase, whereas the costs of some other services may reduce. We construct a game theoretic model trying to capture the possible conflicting interests of different parties in a SOE. Three incentive mechanisms are applied to the model. The first incentive mechanism shares the utility equally among the services involved in the change; the second utilitysharing rule is based on the Nashs bargaining solution, which accommodates the possible biased interdependencies inside the network; and the third rule, based on the Harsanyis modified Shapley value, takes into account the possible coalition formation among the network parties. Since the three rules are analytically solvable, the principles of utility sharing can be implemented, for instance, as exante contracts.

Keywords:

Service Oriented Enterprise , Web Service , Service Culture , Top-Down Change , Economic Analysis , and Game Theory