What it takes to design a supply chain resilient to major disruptions and recurrent interruptions

Global supply chains are more than ever under threat of major disruptions caused by devastating natural and man-made disasters as well as recurrent interruptions caused by variations in supply and demand. This paper presents an optimization model for designing a supply chain resilient to (1) supply/demand interruptions and (2) facility disruptions whose probability of occurrence and magnitude of impact can be mitigated through fortification investments. Numerical results and managerial insights obtained from model implementation are presented. Our analysis focuses on how supply chain design decisions are influenced by facility fortification strategies, a decision maker’s conservatism degree, demand fluctuations, supply capacity variations, and budgetary constraints. Finally, examining the performance of the proposed model using a Monte Carlo simulation method provides additional insights and practical implications

A resilient and sustainable supply chain: Is it affordable?

Developing environmentally and socially sustainable supply chains has become an integral part of corporate strategy for virtually every industry. However, little is understood about the broader impacts of sustainability practices on the capacity of the supply chain to tolerate disruptions. This article aims to investigate the sustainability-resilience relationship at the strategic supply chain design level using a multi-objective optimization model and an empirical case study. The proposed model utilizes a sustainability performance scoring method and a novel programming approach to perform a dynamic sustainability tradeoff analysis and design a “resiliently green” supply chain

Sustainability Analysis under Disruption Risks

Resilience to disruptions and sustainability are both of paramount importance to supply chains. This paper presents a hybrid methodology for the design of a sustainable supply network that performs resiliently in the face of random disruptions. A stochastic bi-objective optimization model is developed that utilizes a fuzzy c-means clustering method to quantify and assess the sustainability performance of the suppliers. The proposed model determines outsourcing decisions and buttressing strategies that minimize the expected total cost and maximize the overall sustainability performance in disruptions. Important managerial insights and practical implications are obtained from the model implementation in a case study of plastic pipe industry

Supply Chain Greening versus Resilience

The relationship between supply chain resilience and environmental sustainability (greening) has been a topic of peripheral discussion in the research literature. The aim in this paper is to investigate, from a supply chain modeling perspective, the extent to which supply chain greening and resilience strategies are supportive of each other. A strategic supply chain design model is introduced that utilizes an environmental performance scoring approach and a new robustness measure, called “elastic p-robustness”, to (1) explore the relationship between greening and buttressing (building resilience), and (2) identify potential tradeoffs to develop “resiliently green” and “greenly resilient” supply chains. Utilizing real data from a multinational apparel company, our analyses and investigations arrive at important practical implications and managerial insights and set the stage for additional research in this area

How green is a lean supply chain?

This article presents a supply chain planning model that can be used to investigate tradeoffs between cost and environmental degradation including carbon emissions, energy consumption and waste generation. The model also incorporates other aspects of real world supply chains such as multiple transport lot sizing and flexible holding capacity of warehouses. The application of the model and solution method is investigated in an actual case problem. Our analysis of the numerical results focuses on investigating relationship between lean practices and green outcomes. We find that (1) not all lean interventions at the tactical supply chain planning level result in green benefits, and (2) an agile supply chain is the greenest and most efficient alternative when compared to strictly lean and centralized situations

Supply Chain Carbon Management

Sustainable supply chain and carbon management have seen a growing interest in the last decade due to the increasing concerns about global warming and climate change. Policymakers, researchers, and executives have taken various roles in efforts to better measure and control greenhouse gas emissions. This book chapter aims to discuss the current state of the art, and key motivations for businesses to decrease emissions, and different policies and regulations that have been designed to incentivize carbon reduction and enhance the environmental awareness of all stakeholders. The chapter also examines the methodologies for measuring and managing carbon emissions of an organization and its supply chain. Further, it discusses carbon management issues related to reverse logistics, life cycle assessment and double counting of emissions

A Framework to Model and Compare Rest Break Policies in Logistics Industry

Carriers and postal companies are under increasing pressure to reduce their operating costs and increase efficiency. One way to reduce costs is to improve the utilisation of drivers’ working hours by employing more efficient rest break policies. A rest break policy is a set of rules consistent with (but more restrictive than) national regulations for Hours of Service (HOS). We develop and test a novel framework to model a class of these policies that concern the location of the rest breaks. In particular, we compare two representative rest break policies using data from a major Australian postal carrier. The first policy imposes no restriction on the location of a rest break. The second policy requires the driver to return to a depot for rest taking allowing time for socialising with others and making use of full amenities at the depot. Our numerical experiments focus on investigating the impact of each policy on postal delivery services in Sydney Metropolitan Area. Our analysis arrives at some interesting managerial insights and identifies important directions for future research in this area

Modelling and Performance Evaluation of Containerised Parcel Delivery

This paper investigates different factors that affect the performance of containerised transportation in parcel delivery networks. Motivated by a situation facing a postal delivery company in Australia, we study how container utilisation rate, sortation activities, and changes in cost parameters can affect the overall performance of a parcel delivery network. Mixed-integer programming and machine learning are employed to model a realistic parcel delivery network considering sortation activities and to evaluate the performance of this network using data from a major postal service provider. The findings of this study can help parcel delivery companies to make more informed investment decisions and introduce more effective performance improvement initiatives

A hidden anchor: The influence of service levels on demand forecasts

Demand planning is informed by demand forecasts, service level requirements, replenishment constraints, and revenue projections. “Demand forecasts” differ from “demand plans” in that forecasts only represent the distribution (or the most likely value) of product demand. Motivated by common forecasting practices in industry, our research examines whether forecasters recognize this difference between demand forecasts and demand plans. Based on a lab experiment informed by data from two large FMCG companies, we found that forecasters factor service levels into their demand forecasts, even when they are clearly instructed to predict the most likely demand and incentivized to minimize the forecast error. We establish that this result holds for students and practitioners alike, and show that this behavior is driven by the service level information, and not some other anchor. We use data from a recent industry survey to support the external validity of our key findings

Managing and measuring sustainability performance of supply chains

Sustainable development from an industrial perspective has extended beyond organisational boundaries to incorporate a supply chain approach. This paper provides a framework which can assist focal companies in development of sustainable supply chains. The literature related to sustainable supply chain evaluation is reviewed incorporating concepts from four organisational theories including the resource based, institutional, stakeholder and social network perspectives to illustrate key drivers and enablers of sustainability initiatives in the supply chain. A conceptual multidimensional framework is then developed which can serve as a tool for research scholars and supply chain practitioners in identifying and assessing various economic, environmental and social performance indicators