Assessing the vulnerability of supply chains using graph theory

Abstract

In today's business environment, harsher and more frequent natural and man-made disasters make supply chains more vulnerable. Supply chain disruptions now seem to occur more frequently and with more serious consequences. During and after supply chain disruptions, companies may lose revenue and incur high recovery costs. If supply chain managers were more capable of measuring and managing supply chain vulnerability, they could reduce the number of disruptions and their impact. In this research we developed an approach based on graph theory to quantify and hence mitigate supply chain vulnerability. Quantification of supply chain vulnerability aids managers in assessing the vulnerability of their supply chains (e.g., across and between supply chains, or over time) and in comparing the effectiveness of different risk mitigation strategies.