The impact of flexibility and redundancy on improving supply chain resilience to disruptions

This paper examines the relative impact on supply chain responsiveness of adding flexibility and redundancy. We seek to investigate the effectiveness of flexibility and redundancy in terms of minimising expected supply chain cost and maximizing expected service delivery when a supply chain is expose...

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Veröffentlicht in:	International journal of production research Jg. 60; H. 6; S. 1992 - 2020
Hauptverfasser:	Kamalahmadi, Masoud, Shekarian, Mansoor, Mellat Parast, Mahour
Format:	Journal Article
Sprache:	Englisch
Veröffentlicht:	London Taylor & Francis 19.03.2022 Taylor & Francis LLC
Schlagworte:	enterprise risk management Flexibility operations management Redundancy Stochastic models Suppliers Supply chain management Supply chains supply network
ISSN:	0020-7543, 1366-588X
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Abstract	This paper examines the relative impact on supply chain responsiveness of adding flexibility and redundancy. We seek to investigate the effectiveness of flexibility and redundancy in terms of minimising expected supply chain cost and maximizing expected service delivery when a supply chain is exposed to supplier and environmental disruptions. Compared to a supply chain that uses neither strategy and is exposed to supplier and environmental disruptions, both practices reduce expected lost sales, reduce expected total cost, and increase the expected service level. Our results show that the backup-suppliers practice is more effective than the flexible-suppliers practice, as measured by cost reduction and service-level improvement. In addition, we show that a hybrid practice created by adding some level of flexibility to a backup-suppliers practice is more desirable in terms of lowering pre-disruption investment, increasing the responsiveness of the supply chain, and lowering the expected total cost. Moreover, the result of the simulation shows that on average, the proposed stochastic model could decrease the company's total cost by 5.51%. It also shows that planning and investing in proactive demand management could decrease the company's total cost by 7.87%. Our findings provide insights into the contingencies that support implementation of each practice.
AbstractList	This paper examines the relative impact on supply chain responsiveness of adding flexibility and redundancy. We seek to investigate the effectiveness of flexibility and redundancy in terms of minimising expected supply chain cost and maximizing expected service delivery when a supply chain is exposed to supplier and environmental disruptions. Compared to a supply chain that uses neither strategy and is exposed to supplier and environmental disruptions, both practices reduce expected lost sales, reduce expected total cost, and increase the expected service level. Our results show that the backup-suppliers practice is more effective than the flexible-suppliers practice, as measured by cost reduction and service-level improvement. In addition, we show that a hybrid practice created by adding some level of flexibility to a backup-suppliers practice is more desirable in terms of lowering pre-disruption investment, increasing the responsiveness of the supply chain, and lowering the expected total cost. Moreover, the result of the simulation shows that on average, the proposed stochastic model could decrease the company's total cost by 5.51%. It also shows that planning and investing in proactive demand management could decrease the company's total cost by 7.87%. Our findings provide insights into the contingencies that support implementation of each practice.
Author	Mellat Parast, Mahour Kamalahmadi, Masoud Shekarian, Mansoor
Author_xml	– sequence: 1 givenname: Masoud surname: Kamalahmadi fullname: Kamalahmadi, Masoud organization: Miami Herbert Business School, University of Miami – sequence: 2 givenname: Mansoor surname: Shekarian fullname: Shekarian, Mansoor organization: Lundquist College of Business, University of Oregon – sequence: 3 givenname: Mahour surname: Mellat Parast fullname: Mellat Parast, Mahour email: mahour.parast@asu.edu organization: Ira A. Fulton Schools of Engineering, Arizona State University
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Snippet	This paper examines the relative impact on supply chain responsiveness of adding flexibility and redundancy. We seek to investigate the effectiveness of...
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SubjectTerms	enterprise risk management Flexibility operations management Redundancy Stochastic models Suppliers Supply chain management Supply chains supply network
Title	The impact of flexibility and redundancy on improving supply chain resilience to disruptions
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