Designing a Robust Supply Chain for Military operations

Abstract

Supply chains are to be found in almost every corporation around the world. When tryingto manage a supply chain often two types of disturbance can jeopardize the effectiveness of a supply chain. These are supply and demand uncertainty. This thesis tries to investigate the effects of those two types of disturbances in a supply chain and seeks to find a remedy. When taking a closer look at supply chains, robust supply chains are considered to withstand a higher level of supply and demand uncertainty. Robustness knows many definitions but is mostly characterized by the responsiveness and adaptability of a supply chain. Responsiveness implies a degree of quick reaction to sudden changes, while adaptability is defined as the capacity to deal with new circumstances. This thesis tries to relate robustness according to a level of resistance of supply and demand uncertainties. The supply chain of the royal dutch land forces is prone to such sudden changes. Therefore this research incorporates the context of a military supply chain to perform experiments on. The military supply chain in operational areas is selected and identified as a 3-echelon-multiple tier-supply chain, where the implementation of a networked supply chain can result in an increase in robustness. The research uses three key performance indicators to ”measure” a degree of robustness. With the use of a multi-agent discrete-event model that incorporates a highly dynamic environment including real-time transportation and order handling simulations. The model also contains an
nteger supply optimization module using CPLEX and a distance-based swarming
algorithm to emulate the lifelike situation of the supply chain concerning order handling and ”Notice to move”. Three experimental setus have been created that try to quantify robustness levels according to networked supply chain operations while coping with demand and supply uncertainty. First, a sensitivity analysis is performed, revealing the basic relationships between the indicator and
emand/supply fluctuation. Second, an extensive model testing according to three different load cases in uncertainty is performed. Thirdly a case study specified for a military context is done. It is found that robustness can be increased by increasing the amount of networked forward supply nodes and interesting dependencies are revealed between the amount of forward supply centers and robustness. The findings of this research can be applied to other industries that have a similar supply chain design.