Analysis of Supply Chain Risk Vulnerability and Mitigation Strageties

Open Access
Author:
Zhang, Xijia
Graduate Program:
Industrial Engineering
Degree:
Master of Science
Document Type:
Master Thesis
Date of Defense:
None
Committee Members:
  • Arunachalam Ravindran, Thesis Advisor
Keywords:
  • supply chain vulnerability
  • mitigation strategy
  • goal programming
Abstract:
Based on a combined inventory and transportation model considering disruption risks for a four-stage global supply chain, this thesis focuses on supply chain network vulnerability and risk mitigation strategies. We use the READI (Resiliency Enhancement Analysis via Deletion and Insertion) method to improve supply chain resiliency. First, we use preemptive goal programming and non-preemptive goal programming methods to solve the baseline mathematical model under no disruptions. Then we generate several disruption scenarios of critical facilities and transportation links based on historical records. According to these disruption scenarios and corresponding disruption duration, we estimate the effect of disruption and the vulnerability of chosen nodes and links with respect to changes of the three objectives (profit, backorders and risk). For each node and link, we consider one specific risk mitigation strategy, such as keeping extra inventory, using backup supplier, purchasing insurance, and use of alternative transportation mode to illustrate how the resiliency can be improved for a supply chain network. After re-optimizing the model, we get the changes in each objective compared to the baseline optimization results. Comparing the results, with and without mitigation strategy, the cost benefits of a mitigation strategy is determined.