Resilience Assessment of Supply Chain Networks Considering Continuously Varying Sates of Firms in Ripple Effect: A Comprehensive and Dynamic Operational-Structural Analysis

Abstract

This study aims to develop a comprehensive assessment approach for supply chain network resilience from structural and operational perspectives in the presence of ripple effect, i.e., localized disruptions due to risk events can propagate rapidly within the network, leading to large-scale failure. The existing assessment works have two non-negligible problems. The first one is neglecting the continuous change of firms’ operation capacities and corresponding multiple states during disruption propagation. Another one is the lack of dynamic modeling of network-level operational resilience. These problems make previous studies fall short of the realistic scenario and cannot comprehensively assess the resilience of supply chain networks. This paper models the continuously changing operational capacities of firms and the corresponding multiple states transition relationship, which provides a more realistic and finer-grained portrayal of disruption propagation in supply chain networks, and serves as a foundation for accurately assessing performance changes of supply chain networks. This study also quantifies the dynamic changes in network-level operational performance based on viable supply chain theory by maximizing the total units delivered flow, enabling a more accurate and comprehensive assessment of operational resilience. Based on the results of large-scale simulation experiments and a real-world case study of Apple's supply chain network, we comprehensively analyzed how resilience factors including network type, network structure and firm risk capabilities influence different dimensions of supply chain network resilience. Based on our findings, we summarize several important managerial implications and provide suggestions for decision-making.