The ripple effect of disruption on a supply chain means local problems can become widespread. Studying the impact of this effect and recovery policies was the focus of research by Dr. Dmitry Ivanov et. al.
The study has two parts. First, it considers the ripple effect in general and provides a case study from the $4.6 billion Australian dairy industry. Disruption due to natural events occurs frequently in Australia and many supply chains for perishable goods are considered time-critical.
Second, the team investigates both proactive and reactive recovery policies. Proactive policies include the development of plans to mitigate disruption and the possibility of building resilience into a supply chain. Reactive recovery policies focus on adjustments to a supply chain during and after an event.
Experiments using simulation are the only way to efficiently test mitigation policies. Dynamic simulation modeling can capture the details and characteristics of each supply chain element and show their complex interdependencies over time. The researchers were able to study supply chain disruption and the effectiveness of recovery policies using anyLogistix.
The research found that both the study of recovery policies and the study of time-critical supply chains is not yet well developed. While contributing to these growing fields of study, the results of the research also provide new tools for supply chain management. Planners can now estimate the impact of real and potential disruptions as well as determine effective stabilization and recovery measures.
The full paper is available for review.
