Determining the optimal size of supply base with the consideration of risks of supply disruptions
Determining the optimal size of the supply base has haunted managers for years. A small supply base gives rise to the risk of supply disruption, whereas a large supply base increases the fixed cost. In this paper, we consider the risks of supply disruption due to occurrence of super, semi-super, and unique events in order to formulate a model to determine the optimal size of supply base. We depict the model in a decision tree-like structure and forward a tabular method of solution that obviates the need avoids evaluation of a majority of non-optimal solutions and thus overcomes the problem of dimensionality.
If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
As the access to this document is restricted, you may want to look for a different version under "Related research" (further below) or search for a different version of it.
References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Kull, Thomas & Closs, David, 2008. "The risk of second-tier supplier failures in serial supply chains: Implications for order policies and distributor autonomy," European Journal of Operational Research, Elsevier, vol. 186(3), pages 1158-1174, May.
- Tang, Christopher S., 2006. "Perspectives in supply chain risk management," International Journal of Production Economics, Elsevier, vol. 103(2), pages 451-488, October.
- Berger, Paul D. & Gerstenfeld, Arthur & Zeng, Amy Z., 2004. "How many suppliers are best? A decision-analysis approach," Omega, Elsevier, vol. 32(1), pages 9-15, February.
- Swift, Cathy Owens, 1995. "Preferences for single sourcing and supplier selection criteria," Journal of Business Research, Elsevier, vol. 32(2), pages 105-111, February.
- Tang, Christopher & Tomlin, Brian, 2008. "The power of flexibility for mitigating supply chain risks," International Journal of Production Economics, Elsevier, vol. 116(1), pages 12-27, November.
- Burke, Gerard J. & Carrillo, Janice E. & Vakharia, Asoo J., 2007. "Single versus multiple supplier sourcing strategies," European Journal of Operational Research, Elsevier, vol. 182(1), pages 95-112, October.
- Serel, Dogan A., 2008. "Inventory and pricing decisions in a single-period problem involving risky supply," International Journal of Production Economics, Elsevier, vol. 116(1), pages 115-128, November.
- Sedarage, Dayani & Fujiwara, Okitsugu & Trung Luong, Huynh, 1999. "Determining optimal order splitting and reorder level for N-supplier inventory systems," European Journal of Operational Research, Elsevier, vol. 116(2), pages 389-404, July.
- Brian Tomlin, 2006. "On the Value of Mitigation and Contingency Strategies for Managing Supply Chain Disruption Risks," Management Science, INFORMS, vol. 52(5), pages 639-657, May.
- Wilson, Martha C., 2007. "The impact of transportation disruptions on supply chain performance," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 43(4), pages 295-320, July.
- Yu, Haisheng & Zeng, Amy Z. & Zhao, Lindu, 2009. "Single or dual sourcing: decision-making in the presence of supply chain disruption risks," Omega, Elsevier, vol. 37(4), pages 788-800, August.
- Ranga V. Ramasesh & J. Keith Ord & Jack C. Hayya & Andrew Pan, 1991. "Sole Versus Dual Sourcing in Stochastic Lead-Time (s, Q) Inventory Models," Management Science, INFORMS, vol. 37(4), pages 428-443, April.
- Ruiz-Torres, Alex J. & Mahmoodi, Farzad, 2007. "The optimal number of suppliers considering the costs of individual supplier failures," Omega, Elsevier, vol. 35(1), pages 104-115, February.
When requesting a correction, please mention this item's handle: RePEc:eee:proeco:v:119:y:2009:i:1:p:122-135. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Zhang, Lei)
If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.
If references are entirely missing, you can add them using this form.
If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.
If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.
Please note that corrections may take a couple of weeks to filter through the various RePEc services.