Assessing production fulfillment time risk: application to pandemic-related health equipment

Abstract

Manufacturing companies strive to identify and manage the effects of unexpected disruptions (risks) on their production processes, which affect their performance and resilience. In this study, we propose a decision framework to capture the impact of interconnected risk sources, on the efficiency of manufacturing companies. The proposed framework utilises a novel mixed-integer linear programming (MILP) model to minimize the time of satisfying the orders while it considers the risk associated with suppliers and manufacturers. The MILP model considers the relationships among (i) material and suppliers and (ii) work centers to measure the propagation of risks throughout the production system. The proposed framework also utilises the Monte Carlo simulation to calculate the associated likelihood of delay and the distribution of the delivery time of orders. To show the complication of the propagation of risk, two distinct scenarios are compared. The first scenario considers zero risks, while the second one assigns probabilistic risk to the suppliers and work centers. The results highlight the magnitude and the complexity of the risk propagation from various interconnected sources through the production system. It also identifies the most vulnerable components of the production system affected more by various types of risk.