Modeling and Mitigating Supply Chain Risk

The previous month has included devastation inflicted by Hurricanes Irma and Maria, not to mention two major earthquakes in Mexico. As neighboring states and countries scramble to help those personally affected, many businesses are also reeling due to the major impacts to their supply chains.  While it may pale in comparison to the human tragedy experienced by the residents affected by these natural disasters,every company’s supply chain is also vulnerable to the major disruptions that result.

From earthquakes to floods, sabotage to blizzards, the world has a way of disrupting even the best-laid plans of supply chain managers and optimizers. Disruptions can have enormous impacts on your company’s supply chain and its bottom line. Even smaller events that don’t make the headlines can still throw a wrench into your day-to-day operations. Although these events cannot be predicted, they can be planned for. As supply chain science has evolved, it has introduced new tools for proactively modeling and mitigating supply chain disruption risk. The question is ‘What is the best way to include these considerations within our planning and models?’

This session will introduce you to some of the ways that disruption risks are considered in supply chain optimization models. We will discuss some “triumphs and fails” that companies have experienced in recent years when faced with disruptions. Then we will review some fundamental supply chain optimization models (such as the EOQ model for inventory optimization and the p-median model for facility location) and discuss how these models can be extended to proactively protect against disruption risk. We will discuss the tradeoff between supply chain cost and supply chain risk to address the question, “is it worth it?”. Finally, we will discuss the first steps that companies might take when starting to add disruption risk to their supply chain planning.

Speaker: Larry Snyder is a Senior Research Associate at Opex Analytics and an Associate Professor of Industrial and Systems Engineering at Lehigh University. He received his Ph.D. from Northwestern University. He has been researching and writing about supply chain disruption risks for over 15 years and has received funding for this research from major corporations and the National Science Foundation. He is co-author of the textbook Fundamentals of Supply Chain Theory, published in 2011 by Wiley, which won the IIE/Joint Publishers Book-of-the-Year Award in 2012. For more information, visit coral.ise.lehigh.edu/larry.

      

  
What Opex Analytics Academy - Session 11: Modeling and Mitigating Supply Chain Risk
When Nov 15 2017 1:00 PM - 2:00 PM (CST)
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