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Patent for Sale:

Secret-Multiattribute Reverse Auction    

Reverse auction algorithm

Overview

Reverse auctions bring forth an increased reach, a more disciplined process and costs reduction of 3% to 40%. Organizations find the process faster, more targeted, and less error prone. They have been adopted by private and public organizations (e.g., GE, HP, US DoD and US Army). The limitation of reverse auctions is its emphasis on price over other values, e.g., quality, service, and delivery. These auctions do not place value on the relationship and the supplier’s accountability, performance and reputation. Over 90% of purchasing managers use both price and non-price attributes in making their procurement decisions. Multiattribute reverse auctions allow for the inclusion of attributes which describe the product (service) as well as the supplier.

Multiattribute auctions either require disclosure of the buyer’s preferences or transformation of the non-price attributes into a single monetary form (e.g., costs). The Imaras reverse auction mechanism does
not have any of these limitations, preferences may remain secret and sellers are given information on every product attribute the buyer is interested in. Imaras also allows for the sellers differentiation based on trust, reputation, and other seller-type attributes. Imaras uses product-type limit sets generated and updated during the auction. These sets direct the bidding process. The mechanism also uses supplier-type limit sets which are used to partition suppliers into groups. While the auction is the same for all suppliers, the product limit sets are not.

Primary Application of the Technology

- E-procurement in logistics services.
- Procurement by public organizations.
- Manufacturing, health, agriculture.

Competitive Advantage

- Bidding over complex products and services in which price and non-price attributes are interdependent (e.g., demand depending on price).
- Secret assessment of bids (e.g., total cost of ownership, revenue, profit, and utility).
- Transparent attributes and their limits generated and updated by the mechanism.
- Secret attributes describing and differentiating suppliers.
- Simple to adapt (e.g., from continuous to round-based auctions) and to use.

Additional Information

TECHNOLOGY DEVELOPMENTAL STAGE
- Key components of the Imaras mechanisms have been implemented in a prototype and tested.
- A video illustrating the system is available.
- The mechanism is extensible and allows for inclusion of components specific to industry and organization.

Patent Summary

U.S. Patent Classes & Classifications Covered in this listing:

Class 705: Data Processing:Financial, Business Practice, Management, Or Cost/Price Determination

This is the generic class for apparatus and corresponding methods for performing data processing operations, in which there is a significant change in the data or for performing calculation operations wherein the apparatus or method is uniquely designed for or utilized in the practice, administration, or management of an enterprise, or in the processing of financial data. It also provides for apparatus and corresponding methods for performing data processing or calculating operations in which a charge for goods or services is determined.