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Such challenges are common in industries such as electronics and automotive manufacturing, in which a shortage of a single part can halt the entire assembly line. The authors develop an optimal procurement mechanism that helps manufacturers decide how much to source from each supplier and how to structure payments contingent on uncertain delivery quantities when suppliers\u2019 production efforts cannot be directly observed. Their analysis reveals a practical menu-based contract under which each supplier selects terms best suited to its situation and the manufacturer subsequently determines order quantities for each component. The study provides both theoretical insights and actionable guidance for managing complex supply relationships in uncertain environments.<\/jats:p>","DOI":"10.1287\/opre.2022.0542","type":"journal-article","created":{"date-parts":[[2025,12,18]],"date-time":"2025-12-18T15:59:18Z","timestamp":1766073558000},"page":"1203-1220","source":"Crossref","is-referenced-by-count":1,"title":["Procurement for Assembly Systems Under Supply Uncertainty: Optimal Mechanisms"],"prefix":"10.1287","volume":"74","author":[{"ORCID":"https:\/\/orcid.org\/0009-0005-7185-0752","authenticated-orcid":false,"given":"Like","family":"Bu","sequence":"first","affiliation":[{"name":"Naveen Jindal School of Management, The University of Texas at Dallas, Richardson, Texas 75080"}],"role":[{"vocabulary":"crossref","role":"author"}]},{"ORCID":"https:\/\/orcid.org\/0000-0001-6956-0856","authenticated-orcid":false,"given":"Milind","family":"Dawande","sequence":"additional","affiliation":[{"name":"Naveen Jindal School of Management, The University of Texas at Dallas, Richardson, Texas 75080"}],"role":[{"vocabulary":"crossref","role":"author"}]},{"ORCID":"https:\/\/orcid.org\/0000-0001-7386-4318","authenticated-orcid":false,"given":"Ganesh","family":"Janakiraman","sequence":"additional","affiliation":[{"name":"Naveen Jindal School of Management, The University of Texas at Dallas, Richardson, Texas 75080"}],"role":[{"vocabulary":"crossref","role":"author"}]}],"member":"109","reference":[{"key":"B1","doi-asserted-by":"publisher","DOI":"10.1287\/msom.2017.0628"},{"key":"B2","doi-asserted-by":"publisher","DOI":"10.1287\/msom.1100.0319"},{"key":"B3","doi-asserted-by":"publisher","DOI":"10.1287\/mnsc.2021.4000"},{"key":"B4","doi-asserted-by":"publisher","DOI":"10.1287\/msom.2020.0918"},{"key":"B5","unstructured":"Elmer-DeWitt P (2014) Apple and GTAT: What went wrong\u2014Update.\n                      Fortune Online\n                      (October 29), https:\/\/fortune.com\/2014\/10\/29\/apple-and-gtat-what-went-wrong."},{"key":"B6","doi-asserted-by":"publisher","DOI":"10.1111\/poms.12199"},{"key":"B7","doi-asserted-by":"publisher","DOI":"10.1287\/msom.2020.0886"},{"key":"B8","doi-asserted-by":"publisher","DOI":"10.1287\/opre.1110.0935"},{"key":"B9","doi-asserted-by":"publisher","DOI":"10.1287\/mnsc.1110.1511"},{"key":"B10","doi-asserted-by":"publisher","DOI":"10.1287\/mnsc.2022.4415"},{"key":"B11","doi-asserted-by":"publisher","DOI":"10.1287\/msom.2017.0672"},{"key":"B12","doi-asserted-by":"publisher","DOI":"10.1111\/poms.12235"},{"key":"B13","doi-asserted-by":"publisher","DOI":"10.1287\/msom.1090.0259"},{"key":"B14","doi-asserted-by":"publisher","DOI":"10.1287\/opre.1120.1084"},{"key":"B15","unstructured":"Kelly G (2023) Apple brings in Samsung to solve iPhone 15 production problem.\n                      Forbes Online\n                      (March 27), https:\/\/www.forbes.com\/sites\/gordonkelly\/2023\/03\/27\/apple-iphone-15-pro-max-oled-display-problem-no-promotion."},{"key":"B16","unstructured":"King I, Wu D (2021) Chip crisis in \u201cdanger zone\u201d as wait times reach new record.\n                      Bloomberg Online\n                      (May 18), https:\/\/www.bloomberg.com\/news\/articles\/2021-05-18\/wait-for-chip-deliveries-increased-in-sign-shortage-persists."},{"key":"B17","doi-asserted-by":"publisher","DOI":"10.1515\/9781400829453"},{"key":"B18","doi-asserted-by":"publisher","DOI":"10.1287\/opre.1120.1155"},{"key":"B19","unstructured":"Lovejoy WS (2010) Conversations with supply chain managers. Ross School of Business Paper No. 1145, University of Michigan, Ann Arbor, MI."},{"key":"B20","doi-asserted-by":"publisher","DOI":"10.1287\/moor.6.1.58"},{"key":"B21","doi-asserted-by":"publisher","DOI":"10.1016\/0304-4068(82)90006-4"},{"key":"B22","doi-asserted-by":"publisher","DOI":"10.1080\/0740817X.2015.1063793"},{"issue":"1","key":"B23","first-page":"96","volume":"92","author":"Simchi-Levi D","year":"2014","journal-title":"Harvard Bus. 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