2.1 Disruption-Resilience Studies
Due to on recent years the probabilities of disruptions has been increase and around the world have occurred many events who interrupt the normal flow of products, information and people; researches has been studying the disruption in the supply chain. The way they focus their studies is developing strategies to improve the resilience on the supply chain while is faced a disruption. Some of the researches which proposed different strategies are summary in Table 1.
Table 1. Disruption and Resilience Studies
Paper Author Objective Methodology
Financial
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To analyze disruptions in the supply chain, researchers focus in different views of point, for example, (Papadakis, 2006) presents a real situation, a case study of the disruption caused by an earthquake in Taiwan in 1999 and the impact in computer industry which is recognized because release new products very often. The PC manufacturer companies mentioned in the study represents two different production policies: Dell and Gateway with a make to order (MTO) business strategy, while Compaq, Hewlett Packard and IBM focus on the traditional make to forecast (MTF) system. The differences between both policies are that in a MTF strategy the company holds inventory of end products for a long period and MTO strategy has the advantage of introduce new products without having inventory of previous final goods and also produce based on customer order. The objective of this research is analyzing the financial effects after a disruption based in the increment in pc component´s prices. With the comparisons of the performance based on revenue, earnings and earnings over revenue were concluded that the price of components in the PC market is more vulnerable during disruptions under the business strategy MTO (make to order). However, due to the nature of the disruption (an earthquake) the MTO companies do not need to change their business structure to get more profit during disruptions; by implementing a risk management policy they can face this kind of events.
Also has been conducted researches where was suggested strategies to enhance the resilience capability in supply chain during disruptions. The contribution made by (Tang, 2006), was to recommend nine robust strategies to mitigate disruptions and increase the resilience in a supply chain. The proposed robust strategies are: Postponement, strategic stock, flexible supply base, make and buy, economic supply incentives, flexible transportation, revenue management, dynamic assortment planning and silent product rollover. To achieve resilience, these strategies will focus on increase product flexibility and availability, supply flexibility, transportation flexibility, control product demand and control of product exposure to customers. The advantage to apply these strategies are that will reduce operations costs and improve customer satisfaction in normal circumstances, additionally under disruptions events, will help to handle consequences during the disruption and whereas back to normal performance. At the time of implement these strategies is important analyze the benefits resulting from each strategy, because if the cost on
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implementation vs benefits is too high, is not worth it; moreover, strategies can also not fit with companies business strategies. Another challenge is that the strategies need to be implemented in a proactively manner, that means before the disruption occurs.
The actions to improve resilience in a supply chain can be implemented before, during or after disruptions, in their study (Falasca et al., 2008), proposed a simulation based framework which is a tool which will help to improve the resilience capacity during the design period of a supply chain. This model includes three determinants of supply chain: supply chain density who refers to the quantity and geographical spacing of nodes within a supply chain; Supply chain complexity who is the relation between number of nodes and interconnection between them and the third determinant the node criticality is the relative importance of a given node within a supply chain. The objective of this study is reducing the impacts and the recovery time from a disruption through increasing the performance of the system by the 3 determinants mention above. By simulation using the software platform Arena and Visual Basic for Application (VBA) is analyzed the future consequences on the recovery time of the system and also cost-benefit of each supply chain design.
While (Carvalho, Barroso, Machado, Azevedo, & Cruz-Machado, 2012) use simulation tool to support decision making process in redesign the Portuguese Automotive supply chain in order to improve resilience to a disturbance. The disturbance in this system affects the transportation of material between two SC entities. Through creating 6 different scenarios could compare the performance of the supply chain under redundancy and flexibility strategies. Redundancy capacity means add a buffer stock to be used during shortage time caused by disturbance, whereas flexibility refers to restructuring existing transport. They compare the behavior of the strategies after a disruption based on the lead time ratio and total cost. At the end, they conclude that both strategies are effective in reducing the negative effects of disturbance, but under flexibility strategy the total cost of the supply chain is lower and the lead time ratio is better compared to redundancy strategy.
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A recent research conducted by (Son & Orchard, 2013) studied the impact of two inventory policies in order to mitigate the effects of supply disruptions on the supply chain. The policies utilized are R policy, that focus on maintain a strategic inventory reserve (different from safety stock) and the Q policy, which place large orders with the purpose to hold large stocks of inventory and so meet demand when a disruption occurs; to compare the product availability both policies were simulated under different disruption frequency and recovery rates. The results of the research shows that in a single retail- single supplier system with deterministic demand, the inventory reserve policy is more effective to mitigate supply side disruptions in a supply chain.
These authors presented the different strategies can be applied to create a more resilient supply chain. In contrast with previous studies, this research proposes analyze two strategies: pull and push supply chain systems to accomplish a more resilient supply chain and to reduce the impact because of the disruption. Both systems and also the combined push-pull system will be compared during a disruption in the manufacturing plant during a period of 5 weeks without production.
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