Strategic Approach for Assessing Supply Chain Resilience Investment Options

Abstract

In today’s business world, supply chain resilience has been brought to the forefront of management topics due to the increasing number of both natural and manmade supply chain disruptions in the past decades. Without an effective method to identify the most impactful resilience actions to take and the amount of investment needed, companies face challenges in appropriately allocating resources to improve overall resilience of their supply chain networks. In collaboration with researchers from the MIT Center for Transportation and Logistics and with data from a sponsoring company, this project characterizes impactful resilience actions and necessary investments within a supply chain network to increase supply chain resilience for a firm. Furthermore, this project provides a roadmap assessing various disruption mitigation and resilience actions and provides a theoretical methodology to identify a firm's performance loss at risk as an indicator for the maximum amount of investment for a particular resilience action. This methodology serves to support supply chain managers in creating effective and actionable resilience strategies to prepare for and respond to unexpected disruptions and build sustainable operations.