On metrics for supply chain resilience

Golnar Behzadi, O’Sullivan, Michael Justin and Tava Lennon Olsen

European Journal of Operational Research, 2020, vol. 287, issue 1, 145-158

Abstract: Resilience, defined as the ability to recover quickly and effectively from a disruption, is critically important for supply chains. Yet, it has not been quantified as frequently as supply chain robustness. In this paper we review the existing metrics for supply chain resilience and introduce a new metric, titled the net present value of the loss of profit (NPV-LP). We test these metrics on a small supply chain problem consisting of one supply and one demand node for a perishable good over a multi-period horizon with a possible port shut-down. We use a stochastic programming formulation of the problem. We show how the different metrics cause different investment decisions for the supply chain, and hence why it is important to carefully pick the correct metric when modeling supply chain resilience.

Keywords: Supply chain management; Supply chain resilience metrics; Resilient strategy; Perishability; Stochastic programming (search for similar items in EconPapers)
Date: 2020
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Citations: View citations in EconPapers (18)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:ejores:v:287:y:2020:i:1:p:145-158

DOI: 10.1016/j.ejor.2020.04.040

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