Open AccessA System Dynamics Approach to Investigate The Effects of Disruption on The Supply Chain with A Mitigation Strategy
Author(s) -
Maizaton Atmadini Abdullah,
Hawa Hishamuddin,
Nen Bazin
Publication year - 2019
Publication title -
iop conference series. materials science and engineering
Language(s) - English
Resource type - Journals
eISSN - 1757-899X
pISSN - 1757-8981
DOI - 10.1088/1757-899x/697/1/012024
Subject(s) - supply chain , system dynamics , supply chain risk management , stock (firearms) , risk analysis (engineering) , operations management , computer science , lead time , supply chain management , business , service management , economics , engineering , marketing , mechanical engineering , artificial intelligence
In this paper, a system dynamics approach is used to simulate a three stages supply chain system experiencing supply disruption. The supply chain system consists of single supplier, manufacturer and retailer. The model is developed suggesting backlogged and inventory as the primary performance measure. The model is tested under three conditions, which are normal condition, disruption condition and disruption with a mitigation strategy. The main findings from the study are lead time changes on the entire system directly impact the inventory of the entire stages in the system. Furthermore, the disruption occurence produces an adverse effect on supply chain performance for a period longer than the actual period of the disruption and likewise, influence system performance. The study further identifies that by incorporating safety stock as a mitigation strategy in the event of a supply disruption, will significantly reduce the disruption impact. The proposed simulation model and experimental findings are important to assist management in their inventory and risk control decision-making in the event of disruptions.