  We study the management of product transitions in a semiconductor
manufacturing firm that requires the coordination of resource allocation
decisions by multiple, autonomous Product Divisions using a multi-follower
bilevel model to capture the hierarchical and decentralized nature of this
decision process. Corporate management, acting as the leader, seeks to maximize
the firm's total profit over a finite horizon. The followers consist of
multiple Product Divisions that must share manufacturing and engineering
resources to develop, produce and sell products in the market. Each Product
Division needs engineering capacity to develop new products, and factory
capacity to produce products for sale while also producing the prototypes and
samples needed for the product development process. We model this
interdependency between Product Divisions as a generalized Nash equilibrium
problem at the lower level and propose a reformulation where Corporate
Management acts as the leader to coordinate the resource allocation decisions.
We then derive an equivalent single-level reformulation and develop a
cut-and-column generation algorithm. Extensive computational experiments
evaluate the performance of the algorithm and provide managerial insights on
how key parameters and the distribution of decision authority affect system
performance.
