Introducing Risk Considerations into the Supply Chain Network Design

Abstract

Supply chains (SC) aim to provide products to the final customer at a certain service level. However, unforeseen events occur that impede supply chain objectives. SC Risk has been studied in the literature, providing frameworks and methodologies to manage SC failures. Nevertheless, more efforts are needed to prevent hazardous and disruptive risks and their consequences. These risks must be considered during the process of designing a supply chain. Some methodological contributions concerning risk in the supply chain network design (SCND) are conceptual frameworks for mitigating SC disruptions, which suggest strategies and measures for designing robust and resilient SCs. Although such contributions are valuable, they do not indicate how to cope with risk when designing a SC. The main objective of this research is to describe a methodology aimed at including risk considerations into the SCND. Our proposal aims to be, on the one hand, a comprehensive approach that includes a risk identification and assessment procedure in each of the stages of the SCND process and, on the other hand, a tool for decision-making in SC design or redesign processes when SC risks need to be considered. The methodology proposed is an extension of a SCND methodology including risk considerations in order to improve the performance of the supply chains. A case study illustrates how the proposed methodological works, achieving the identification of SC risks already observed in previous works.

Sustainable supply chain management towards disruption and organizational ambidexterity: A data driven analysis

“… I17 Supply chain network design SC network design represents the facility location problem, and SC management contains facility location determination, magnitude, network capabilities and the material flow among the located facilities. Pishvaee and Razmi (2012); Fattahi et al (2020 b); Benedito et al (2020) ; Hamdan & Diabat (2020) ; Fazli-Khalaf et al (2019) ; Diabat et al (2019) ; Snoeck et al (2019) ; Li & Zhang (2018) ; Jabbarzadeh et al (2018) ; Fattahi et al (2017) ; Jabbarzadeh et al (2013); Azad (2014); Hasani et al (2020) ; Nezamoddini et al (2020) . I18 Supply chain resilience SC resilience define as the SC adaptive ability to respond to disruptions, react to unexpected occasions, and then recover by continuously maintaining operations at the desired balanced of connectedness and control over the SC function and structure.…”

The derivation and visualization of supply network risk profiles from product architectures

“…Suffo and Brome 22 provide a methodology for risk management in the aeronautical sector which, similar to Oliveira et al. and others, such as Benedito et al., 23 include risk identification, assessment, action, implementation, and control and monitoring. By focusing on the identification of risk, both Suffo and Brome and this paper provide decision makers with opportunities to select design alternatives based on supply chain risk.…”

Developing Knowledge of Supply Chain Resilience in Less-Developed Countries in the Pandemic Age

“…Supply chain risks are driven by a variety of internal and external sources of vulnerability. Moreover, Benedito et al [52], distinguish between three broad categories of supply chain vulnerability sources: (1) endogenous assets (equipment, human resources, inventories, distribution, recovery and service centers); (2) supply chain partners (customers, suppliers and subcontractors); (3) and exogenous geographical factors (natural disasters, major accidents and intentional attacks).…”

“…Decisions at the supply chain level are taken by the partners, and in case of disruption, the partners look for new alternatives. Suppliers are generally recognized as having an important role in the supply chain disruption, as mentioned by Bode et al [39], Wagner et al [40] and Benedito et al [52]. On the one hand, because they understand the way the company works, the deadlines and the necessary quantities of raw materials that the company needs (Company A) ensure that the products arrive at their destination in the agreed times (Company B) and help adjust the company's production in case of changes in its supplied products (Company D).…”