Investigating Resilient Supply Chain Design Determinants Using Monte Carlo Simulation

Modern supply chains are faced by various internal and external disruptions with random severities that may affect the production capacities of different facilities (suppliers, factories and distributors). In order to minimize the reduction in profit when disruption hits facilities, the resilient supply chain network structure must be reached that has ability to resist disruptions. The proposed research presents a tool for designing resilient supply chain networks. Different structures are proposed considering the design determinants of supply chain density and node criticality. The ability of each structure to resist disruptions is tested by randomly disrupting factory production capacities using Monte Carlo simulation. Reductions in profit due to disruption are calculated and compared to reach the resilient structure with optimum determinants values. The proposed research shows the effect of increasing customer demand on reaching resilient supply chain network structures.