A fuzzy dynamic Inoperability Input–output Model for strategic risk management in Global Production Networks

Ali Niknejad and Dobrila Petrovic

International Journal of Production Economics, 2016, vol. 179, issue C, 44-58

Abstract: Strategic decision making in Global Production Networks (GPNs) is quite challenging, especially due to the unavailability of precise quantitative knowledge, variety of relevant risk factors that needs to be considered and the interdependencies that can exist between multiple partners across the globe. In this paper, a risk evaluation method for GPNs based on a novel Fuzzy Dynamic Inoperability Input Output Model (Fuzzy DIIM) is proposed. A fuzzy multi-criteria approach is developed to determine interdependencies between nodes in a GPN using experts’ knowledge. An efficient and accurate method based on fuzzy interval calculus in the Fuzzy DIIM is proposed. The risk evaluation method takes into account various risk scenarios relevant to the GPN and likelihoods of their occurrences. A case of beverage production from the food industry is used to showcase the application of the proposed risk evaluation method. It is demonstrated how it can be used for GPN strategic decision making. The impact of risk on inoperability of alternative GPN configurations considering different risk scenarios is analysed.

Keywords: Risk management; Inoperability Input Output Models; Global Production Networks; Supply Chain Management Risk; Fuzzy arithmetic; Dynamic models (search for similar items in EconPapers)
Date: 2016
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Citations: View citations in EconPapers (4)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:proeco:v:179:y:2016:i:c:p:44-58

DOI: 10.1016/j.ijpe.2016.05.017

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