Enhancing Supply Chain Resilience and Efficiency through Fuzzy Logic-based Decision-Making Automation in Volatile Environments

Abstract

In light of recent mutations and economic volatility stemming from unforeseen global events and increasing security concerns, supply chains are confronted with the complex challenge of fulfilling uncertain customer demands while ensuring sustained value addition. This study introduces a novel approach utilizing fuzzy logic decision-making automation to address and mitigate the impact of current disruptions. By employing if-then scenarios, this methodology facilitates the generation of more accurate predictions and smarter supply planning, enabling effective decision-making, particularly in critical areas such as semiconductor supply sourcing. The integration of Artificial Intelligence within this framework provides dynamic visibility into real-world supply chain operations, thereby aiding in more informed and effective regulatory decisions and fostering continuous improvement. The core innovation of this research lies in the development of a unique Mamdani-fuzzy logic model designed to enhance supply planning. This model extends beyond the realm of efficient inventory management to encompass safer demand forecasting and market segmentation, showcasing its superiority in versatility and effectiveness compared to conventional methods, and leveraging expert knowledge to navigate uncertainties. Through the process of fuzzification, relevant indicators such as Consumption Severity, Market Sensitivity, and Commodity Importance are identified and modeled, with input variables being assigned membership functions and categorized into varying degrees of significance. The Mamdani-inference rules are then formulated, and the output of the fuzzy logic model is defuzzified using the centroid technique to derive precise supply quantities. Simulations conducted in MATLAB demonstrate the model's capacity to convert uncertainty into optimal supply measures across diverse scenarios, thereby enhancing safety and efficiency within the supply chain by minimizing excess inventory and preventing stockouts. This hybrid approach, combining mathematical reasoning with human expertise, validates the efficacy and robustness of fuzzy logic as a potent cognitive and modeling technique for facilitating precise and responsive decision-making in the face of unexpected incidents, imprecision, and qualitative factors affecting the supply chain.

An Integrated Inventory-Production-Distribution Model for Crisis Relief Supply Chain Optimization: A Systematic Review and Mixed Integer Programming Formulation

“…A comparative study of LINGO integrated and decoupled approaches' outputs of the model would be an interesting avenue of reflection, that can be extended with predictive analytics, especially demand forecasting like the Mamdanifuzzy logic decision model just recently proposed by three authors of the present article in [87] and last-mile logistics [88]. Indeed, we point out stimulating research perspectives that can enhance the proposed supply chain planning model, including sustainability-based risk pooling [89] and fuzzy optimization to satisfy and adapt scenario-based demand for uncertainty mitigation in a real-world environment.…”