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Resilience of supply chain networks to major disruptions can now be measured using a multi-factor test

November 01, 2018 / Phys.org

By analyzing the structure of a supply chain network and the resilience of its components, A*STAR researchers have developed an analytic measure that will allow a company to determine its vulnerability to major supply chain disruptions. The measure has the potential to dramatically improve decision-making in supplier management and lower financial risk across many sectors. Disruptions in the supply chain can have severe consequences for an unprepared venture. Think of a milk processor without a supply of milk, or a car manufacturer without a supply of engine parts. This can have immediate effects downstream in the network, as well as knock-on effects on other businesses dependent on the network for survival. When such disruption occurs on a massive scale, the economic fallout can be catastrophic and widespread. The possible scale of loss prompted Rick Goh and his team at A*STAR's Institute of High-Performance Computing to start looking at ways to measure supply chain risk.