Supply Chain Risk Management in Chinese Process Industries

Process industries are important component of Chinese economy. While supply chain risks are going up rapidly under globalization, it affects process industries to operate continuously and safely. Thus it is necessary to research on how to manage risks in process industries supply chain effectively. In this paper, we identify supply chain risks underlying Chinese process industries and present some mitigation strategies. However, the application of mitigation strategies costs much, and different mitigation strategy has different effect on risk reduction. In order to select optimal mitigation strategies effectively without exceeding the expenses budget, we develop a 0-1 ILP model. In the case study, we draw out the needed data after interviewing with managers and operation workers of a chemical company in Shanghai. Moreover, we use software LINDO 6.1.to achieve the optimal solution. Finally we discuss how the change of model parameter affects the optimal solution and present future works.