Information Flow and Mitigation Strategy in a Supply Chain under Disruption
(English)Manuscript (preprint) (Other academic)
Current supply chain systems are structurally and behaviourally complex. The aim of this paper is to investigate the consequences of a supply chain in the case of disruption risk by exploiting the information flow. When studying supply chain disruption, there are two important aspects to be considered; the dynamics of supply chain information flow and the behaviour of supply chain entities towards disruption. Our simulation model proposes a system dynamics approach to cater for the dynamic properties of supply chain information flow when disruption occurs at one of its entities. In particular, we focus on the operational reaction of a supply chain which employs a dualsouring principle with a back-up supplier.
According to our observation, information flow is often transmitted throughout the network, resulting in a continuous influence on individual entities after any change occurs. In addition, each entity reacts differently when it identifies disruption in information flow. This variety of reactions further influences the information flow and may also contribute to the disturbance of information. Severe disruption shows signs of impacts on the supply chain earlier and longer. The implementation of dual-sourcing helps to reduce disruption impacts. An appropriate order shifting and a quick reaction time could further reduce disruption impacts. However, entirely shifting orders to a backup supplier is not always recommended. Furthermore, in most cases, the earlier the revised order splitting is executed, the lower the impact that is observed. We also identify that extensive information sharing applied within a supply chain brings agility, which further results in a better system reaction towards disruption.
Supply chain risk management, simulation modelling, system dynamics, dual-sourcing
Engineering and Technology
IdentifiersURN: urn:nbn:se:liu:diva-78760OAI: oai:DiVA.org:liu-78760DiVA: diva2:535613