An Inoperability Input-Output Model (IIM) for disruption propagation analysis

Today's Supply Chains (SCs) are global and getting more complex, due to the exigencies of the world economy, making them hard to manage. This is exacerbated by the increasingly frequent occurrence of natural disasters and other high impact disruptions. To stay competitive, companies are therefore seeking ways to better understand the impact of such disruptions to their SCs. In addressing this need, this paper proposes an approach for disruption propagation analysis. We develop a method based on a variation of an Inoperability Input-Output Model (adapted from a Leontief I-O model) to quantify the impact of disruptions across the entire SC. We then analyse the factors that have the most influential impacts on the SCs during disruptions. Initial results show that trading volume handled by a company/ node is an important factor in determining the disruption impact to SCs, besides the number of SC partners (connections) as implied from previous work.