Robust Supply Chain Network Design Under Facility Disruption by Consideration of Risk Propagation

A supply chain consists of facilities that are subjected to various types of disruption. When one or more facility in the supply chain is disrupted, its impact propagates and reduce the performance of the supply chain. This research paper takes into consideration the probability of a disruption scenario to design a robust network for a supply chain. A stochastic mathematical formulation has been presented as a mixed-integer linear programming model for maximizing the concerned profit. For measuring the supply chain's robustness, the final quantity delivered after risk propagation in the disruption scenario as a robustness index (RI) is utilized. A numerical simulation is conducted to calculate the robustness index at different linking intensity and node threshold. The robustness index is compared under different disruption scenarios to obtain the optimal combination concerning linking intensity and node threshold.