Measuring and managing risks in supply chain planning
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Date
2023
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Thesis (M.S.) - Bogazici University. Institute for Graduate Studies in Science and Engineering, 2023.
Abstract
In today’s globalized world, supply chains have global characteristics as well. Instead of geographically separated supply chains, there exists a global single supply chain in the world. Because of this circumstance, disruptions even at geographically distant locations can have severe impacts on all businesses globally. This nature of business increases the importance of supply chain risk management (SCRM) more than ever. Manufacturing plants require accurate tools to measure and manage risks effectively and profitably. In this study, an enhancement to Material Requirements Planning (MRP) type production planning is proposed such that supply chain risk can be measured precisely and risk management policies can be developed accordingly. Initially, supply chain disruptions are defined and categorized and buffers used against these uncertainties are introduced to the MRP optimization model. With this new model and a risk function defined in terms of backlogs, an SCRM framework in the form of buffer management is proposed. Afterwards, the performance of the model with different settings is observed with simulation experiments and the statistical analysis is conducted on the data. Although the most significant buffering policy was found to be the supplier lead times, many findings were discovered on the effects of buffers on the supply chain (SC) risk and the profitability of the business.