Economics at your fingertips  

Selection of Optimal Redundancy Strategies for a Supply Network

Abroon Qazi, John Quigley, Alex Dickson, Barbara Gaudenzi and Şule Önsel

A chapter in Innovations and Strategies for Logistics and Supply Chains: Technologies, Business Models and Risk Management, 2015, pp 419-450 from Hamburg University of Technology (TUHH), Institute of Business Logistics and General Management

Abstract: Supply chains have become more vulnerable because of increased globalization and interdependency between network actors and risks. It is, therefore, extremely important to model interdependency between risks taking into account the supply network configuration. In this paper, we have followed the existing concept of modelling supply network as a Bayesian belief network capturing network configuration, probabilistic interdependency between risks and losses resulting from the realization of risks. We propose a new method for evaluating efficacy of different combinations of redundancy strategies. For each node of the network, we incorporated a strategy of adding redundant resource as a risk management approach that would disengage the particular node from its parent node(s). The model was solved against the bicriteria objective of maximizing normalized expected utility for loss exposure and normalized utility for cost of redundancy strategies keeping into account different risk attitudes and criteria weights. The model also helped in identifying optimal combination of strategies for specific allocation of budget as there could be different combinations of allocating redundant resources across the network resulting in supoptimal values of risk measures.

Keywords: Supply Network Configuration; Bayesian Belief Network; Redundancy Strategies; Risk Attitudes (search for similar items in EconPapers)
Date: 2015
References: View references in EconPapers View complete reference list from CitEc
Citations: Track citations by RSS feed

Downloads: (external link) (application/pdf)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link:

Access Statistics for this chapter

More chapters in Chapters from the Proceedings of the Hamburg International Conference of Logistics (HICL) from Hamburg University of Technology (TUHH), Institute of Business Logistics and General Management
Bibliographic data for series maintained by ZBW - Leibniz Information Centre for Economics ().

Page updated 2023-03-27
Handle: RePEc:zbw:hiclch:209264