Supply chain risk mitigation: Rescheduling the risky suppliers using multi criteria linear goal programming

Abstract

Supply chains (SC) are vulnerable to risk. They are the vital contributors of success for any business. Further the business excellence tools like Just in Time (JIT) aggravate the risks to business. Therefore, SC risk mitigation (SCRM) module is proposed to maximize the conformance to schedule and alleviate such risks. This article is a simple data and model-driven Decision Support System (DSS), designed for complex decisions making like supplier selection, helping to analyze various proposition and choosing the best option. This DSS can be deployed via software like R or Excel spread-sheets. Computer based database for supplier performance is created and is kept readily accessible to check, monitor and update; thus, the value is continuously added to the database. Proposed method is based on Goal Programming (GP). It manages the twin objectives of minimizing the risk-cost and maximizing the probability of adherence to schedule, leading to maximize customer satisfaction. Thus, SC managers can beat the likely disruptions arising out of business vulnerabilities and be more successful. This can be accomplished by performing risk analysis, supplier evaluation, calculating supplier risk hazards and establishing risk-cost-budget optimality.