The Effect of Redundant Capacity Strategy on Supply Chain Resilience Using Simulation

KRISTIAWAN, DAVID OBOE and Widyadana, I Gede Agus (2023) The Effect of Redundant Capacity Strategy on Supply Chain Resilience Using Simulation. In: ICE-SMARTECH, 18-07-2023 - 18-07-2023, Bandung - Indonesia.

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Abstract

Supply chain resilience is an important adaptive capability and must exist in every supply chain network. Disruptions that occur in the supply chain will have a major impact on customer satisfaction. When customers are not satisfied, a company may start dealing with the effects of disruptions to its supply chain over time. Dissatisfied customers will issue fines or switch suppliers to meet their needs. Several strategies need to be implemented to minimize the impact that occurs due to disruption, especially the impact on customers. The total cost and total recovery time will be affected by customer behavior when there is a disruption to the supply chain network. Structural simulation will use agent-based modeling by implementing a redundant capacity strategy at each production plant. The percentage of redundant capacity will vary with several different conditions. Recovery time and total cost from the disruption that occurs will be influenced by customer behavior. Customer behavior is divided into two categories: critical customers and cumulative customers. The two customer behaviors will have a different impact on the strategy chosen. A supply chain resilience assessment index will be obtained for time to recover, and the total cost caused by disruption. The selection of the best strategy must be known before the strategy helps the company analyze recovery times in a disruptive situation using a redundant capacity strategy.

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