The efficient and stable planning for interrupted supply chain with dual‐sourcing strategy: a robust optimization approach considering decision maker's risk attitude

Bing Han, Ying Zhang, Song Wang and Yongshin Park

Omega, 2023, vol. 115, issue C

Abstract: In the face of the complex market environment and the in-depth development of globalization, ensuring the supply chain's stability and cost leadership by developing a differentiated dual-source procurement strategy is extremely important. The present study contemplates the supply chain as the research object. It also considers disruption uncertainty and decision-makers’ risk attitudes. To minimize costs and shortages, we build a dual-objective robust optimization model for a dual-sourcing strategy under interruption risk. The authors aim to explore efficient and robust planning under supply disruption uncertainty in dual-sourcing strategies by different risk attitudes. The research employs the augmented ε-constraint method to solve the proposed model by transforming the model into a single-objective mixed-integer programming model. Additionally, our study uses enterprise examples to prove the feasibility and effectiveness of the model. Moreover, it conducts risk attitude analysis, dual objective function trade-off analysis, and superiority analysis of procurement strategies. Finally, we put forward some management insights to provide a new decision-making idea for real supply chain enterprises in the case of supply interruption risk.

Keywords: Supply disruptions; Dual-sourcing; Risk attitude; Robust optimization; Dual-objective programming (search for similar items in EconPapers)
Date: 2023
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Citations: View citations in EconPapers (1)

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DOI: 10.1016/j.omega.2022.102775

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