How to Cope with Uncertainty in Supply Chains? - Conceptual Framework for Agility, Robustness, Resilience, Continuity and Anti-Fragility in Supply Chains

Zi zmann, Immanuel Con e ence Pape How o Cope wi h Unce ain y in Supply Chains? - Concep ual F amewo k o Agili y, Robus ness, Resilience, Con inui y and An i- F agili y in Supply Chains P o ided in Coope a ion wi h: Hambu g Uni e si y o Technology (TUHH), Ins i u e o Business Logis ics and Gene al Managemen Sugges ed Ci a ion: Zi zmann, Immanuel (2014) : How o Cope wi h Unce ain y in Supply Chains? - Concep ual F amewo k o Agili y, Robus ness, Resilience, Con inui y and An i-F agili y in Supply Chains, In: Ke s en, Wol gang Blecke , Tho s en Ringle, Ch is ian M. (Ed.): Nex Gene a ion Supply Chains: T ends and Oppo uni ies. P oceedings o he Hambu g In e na ional Con e ence o Logis ics (HICL), Vol. 18, ISBN 978-3-7375-0339-6, epubli GmbH, Be lin, pp. 361-377 This Ve sion is a ailable a : h ps://hdl.handle.ne /10419/209215 S anda d-Nu zungsbedingungen: Die Dokumen e au EconS o dü en zu eigenen wissenscha lichen Zwecken und zum P i a geb auch gespeiche und kopie we den. 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I he documen s ha e been made a ailable unde an Open Con en Licence (especially C ea i e Commons Licences), you may exe cise u he usage igh s as speci ied in he indica ed licence. h ps://c ea i ecommons.o g/licenses/by-sa/4.0/  361 How o Cope wi h Unce ain y in Supply Chains? - Concep ual F amewo k o Agili y, Robus ness, Resilience, Con inui y and An i-F agili y in Supply Chains Immanuel Zi zmann Abs ac Globaliza ion and new echnologies led o he global and lean supply chains ha we see oday. Bu cos -e iciency alone does no c ea e cus ome alue. Goods and se ices ha e o be a ailable a he ime o demand. Sho e p oduc -li e-cycles demand ola ili y and ex e nal dis up ions o ce supply chains o be lexible, adap i e as well as cus ome -o ien ed. A li e a u e e iew iden i ies di e en concep s o achie e hese abili ies. These a e: agili y, obus ness, esilience, con inui y managemen , and an i- agili y. All i e concep s y o handle unce ain ies bu pu sue di e en app oaches. A he beginning o he 21 h cen u y he idea o an agile supply chain was p omo ed. The goal is o lexibly eac o changes. In con as esilience aims o o e come p oblems. Flexibili y is also pa o obus ness. A obus supply chain is supposed o e icien ly manage luc ua ion wi hin he ne wo k. Compa ed o ha , con inui y managemen ies o handle h ea s. Pa s o hese h ea s a e demand o p oduc ion luc ua ions pu also majo dis up ions. To c ea e compe i i e ad an ages ou o hese unce ain ies is he idea o an an i- agile supply chain. This pape compa es ecen concep s o he managemen and design o u u e supply chains. I also p o ides a concep ual amewo k how he di e en app oaches in e ac o c ea e syne gies. An ou look o u u e esea ch is also gi en. Keywo ds: supply chain, unce ain y, handling concep s, amewo k Immanuel Zi zmann 362 1. In oduc ion Today compe i ion akes place be ween supply chains, no be ween single companies (Lambe and Coope , 2000). This leads o alue c ea ing ne wo ks. The ocus on e iciency and he complexi y o global supply chains makes hem ulne able (C aighead, e al, 2007). No only high isks bu also low- p obabili y/high-impac as well as ope a ional unce ain ies jeopa dize alue c ea ion (Klibi, Ma el and Gui oni, 2010; Van Landeghem and Vanmaele, 2002; S ensson, 2000). Such dange s a e inc easing because o sho e p oduc -li e- cycles, ma ke libe aliza ion and new echnologies. The e o e, managemen has o igu e ou how supply chains can be designed and ope a ed wi hou ailu e (Zsidisin, Melnyk and G aga z, 2005). Wi hin he li e a u e o supply chain managemen he concep s o esilien / obus as well as agile supply chains a e p oposed. This a icle will look a hese ideas o e alua e whe he hey a e app op ia e o handling unce ain ies o no . In addi ion, con inui y managemen and he idea o an i- agili y will be conside ed. The aim o his pape is o de ine hese i e app oaches and show whe e di e ences and syne gies lay. To achie e his, he s uc u e will be as ollows: Fi s , supply chain managemen and unce ain y will be de ined. I is ollowed by he in oduc ion o he i e app oaches o handling unce ain ies in he hi d chap e . The sugges ion o a concep ual amewo k will be in oduced in chap e 4. I also ou lines he di e ences and syne gies o he di e en ideas. The inal chap e will be he conclusion. 2. Unce ain y in Supply Chains Supply chain managemen is accep ed as an impo an ield o s udy, bu s ill has no single de ini ion. Fo his pape a combined de ini ion om Ch is ophe (2006) and The Global Supply Chain Fo um (Lambe and Coope , 2000) will be used. Acco ding o hem, supply chain managemen is " he in eg a ion o key business p ocesses om end use h ough o iginal supplie s ha p o ides How o Cope wi h Unce ain y in Supply Chains? 363 p oduc s, se ices, and in o ma ion […] o deli e supe io cus ome alue a less cos o he supply chain as a whole". The goal is o in eg a e unc ions and p ocesses o indi idual depa men s, loca ions and i ms ac oss companies' boa de s o educe cos s and inc ease cus ome alue (Coope , Lambe and Pagh, 1997). Making decisions unde unce ain y is pa o e e y managemen p ocess. The e o e, i has o be conside ed in supply chain managemen as well. Fig. 1: Di e en ia ion be ween isk and unce ain y Unce ain y can be desc ibed as he inabili y o p edic some hing (Milliken, 1987). O en he e m isk is used in e changeably wi h unce ain y. Bu hey a e no he same. The e a e wo opinions how hey can be dis inguished, as can be seen in igu e 1. In bo h cases unce ain y is mo e han isk. I can be di e en ia ed acco ding o i s p edic abili y. I i is possible o quan i y a p obabili y o occu ence, i is called isk, i no i is called unce ain y (Knigh , 1971). The second app oach conside s he consequences o unce ain y. I hey a e posi i e, hey a e called chances; i hey may be nega i e, hen hey a e isks (Simangunson, Hend y and S e enson, 2012). In his pape he second poin o iew will be aken and he e m unce ain y desc ibes bo h, isks and chances. Acco ding o Tang (2006) isks can be ope a ional o dis up i e. Bo h can occu wi hin he supply chain o ex e nal (Wa e s, 2007). Be o e hese di e en ia ions can be applied he concep s will be explained in chap e 3.   Immanuel Zi zmann 364 3. Handling Concep s in Supply Chains Resilien and agile supply chains a e sugges ed o handle unce ain ies in alue c ea ing ne wo ks. Robus ness is some imes used as a synonym. To cla i y his and also o compa e hem o con inui y as well as o an i- agile managemen he i e concep s will be in oduced in he ollowing pa ag aphs. 3.1 Agili y In supply chain managemen li e a u e he de ini ion o Naylo (Naim and Be y, 1999) is used o desc ibe agili y (Ba amichai, Zimme s and Ma angos, 2007; Ch is ophe and Towill, 2000; Mason-Jones, Naylo and Towill, 2000): “Agili y means using ma ke knowledge and a i ual co po a ion o exploi p o i able oppo uni ies in a ola ile ma ke place.” This unde s anding was de eloped in con as o he lean pa adigm (Fishe , 1997), which only wo ks in a s able en i onmen (Mason-Jones, Naylo and Towill, 2000). The agile supply chain on he o he hand is designed o cope wi h changes (Ch is ophe , 2000). The ocus is on sho - e m demand luc ua ions as well as changes in consume beha io . An agile supply chain is able o use hese changes o make p o i . The idea is o design a ne wo k ha is lexible and esponsi e as well as e ec i e (Cha les, Lau as and Van Wassenho e, 2010). I is impo an o no e ha an agile supply chain will be able o eac o demand ola ili y and deli e s a compe i i e ad an age as i is cus ome ocused. Bu i is no designed o handle unce ain ies wi hin he supply chain. 3.2 Robus ness Compa ed o agili y, i is di icul o ind a consis en de ini ion o obus ness in he con ex o supply chain managemen . One eason o his is ha he e m obus ness is o en used bu no de ined a all (Kas sian and Mönningmann, 2011). Vlajic ( an de Vo s and Hend ix, 2008) gi es an o e iew o di e en obus ness de ini ions. In his pape obus ness will be unde s ood acco ding o de Neu ille, e al. (2004) as he “abili y o a sys em o main ain i s ope a ional How o Cope wi h Unce ain y in Supply Chains? 365 capabili ies unde di e en ci cums ances”. The supply chain is he sys em ha is conside ed he e. The ope a ional capabili y ha should be main ained is i s goal: ma ch demand. The ollowing de ini ion summa izes aspec s o di e en au ho s (Goe schalckx, Huang and Mi al, 2012; Klibi, Ma el and Gui ouni, 2010; Leung and Wu, 2004; Van Landeghem and Vanmaele, 2002) and desc ibes a obus supply chain as: "A supply chain ha is able o ma ch demand and ope a e on a good cos and p o i line in an unce ain en i onmen ." Fig. 2: Le els o a obus supply chain The e e ence o cos s is in eg a ed o gua an ee pe o mance o ien a ed managemen . Supply chain managemen li e a u e as well as obus op imiza ion app oaches iden i y wo le els o a obus supply chain which a e isualized in igu e 2 (Pan and Nagi, 2010; Leung and Wu, 2004; Van Lendeghem and Vanmaele, 2002; Mul ey, Vande bei and Zenios, 1995; Kou elis, Ku awa wala and Gu ié ez, 1992). These a e design a iables which a e ixed and include edundancies. They build he ounda ion and p o ide he necessa y lexibili y o he second s age. He e con ol a iables adjus o he en i onmen and handle unce ain ies. P ac ical ools o bo h le els ha e o be iden i ied.  Immanuel Zi zmann 366 3.3 Resilience Ch is ophe and Peck (2004) de ine esilience in he supply chain con ex as “ he abili y o a sys em o e u n o i s o iginal s a e o mo e o a new, mo e desi able s a e a e being dis u bed”. The ocus o a esilien supply chain lays on majo dis up ions o he alue c ea ing ne wo k e.g. ea hquakes, shu downs o ac o ies o labo dispu es (She i, 2007). Such e en s ha e d ama ic impac on he supply chain pe o mance as can be seen in igu e 3. I shows he impac o he dis up ion and how long i akes o eco e om i . These e en s a e no co e ed by adi ional isk managemen because hey a e low- p obabili y/high-impac inciden s. The ocus o isk managemen lays on high- p obabili y/high-impac isks. Fig. 3: Impac o dis up i e e en s on supply chain pe o mance (She i and Rice, 2005) Tomlin (2006) summa izes he di e en app oaches and iden i ies wo majo quali ies o a esilien supply chain: mi iga ion and con ingency. Klibi (Ma el and Gui ouni, 2010) uses di e en e ms bu ha e he same in en ion by desc ibing a oiding/ ans e ing isks and using esponsi eness as he wo componen s o a esilien supply chain. In he bes case success ul mi iga ion  How o Cope wi h Unce ain y in Supply Chains? 367 means ha he dis up ion does no a ec he supply chain a all o a leas educes he impac . These s a egies ha e o be execu ed be o e an e en occu s. Responsi e abili ies a e only applied when disas e hi s, bu s ill ha e o be planed and implemen ed in o a supply chain. Pe i (Fiksel and C ox on, 2010) poin s ou ha using all s a egies o c ea e a esilien supply chain is no always he bes . I is impo an o conside he ade-o be ween he cos o esilience capabili ies and he ulne abili y o low-p obabili y/high-impac e en s. 3.4 Con inui y Managemen Business con inui y managemen has i s oo s in disas e eco e y as well as business con inui y planning (He bane, 2010). I is seen as pa o he s a egic managemen o handle he impac o c ises (Adamou, 2014; Pi and Goyal, 2004). Acco ding o he B i ish S anda ds Ins i u ion (2006), Ellio (Swa z and He bane, 2010) de ines i as: "A holis ic managemen p ocess ha iden i ies po en ial h ea s o an o ganiza ion and p o ides a amewo k o building esilience and he capabili y o an e ec i e esponse ha sa egua ds he in e es s o i s key s akeholde s, epu a ion, b and and alue c ea ing ac i i ies." The ocus o he business con inui y app oach lays again on dis up i e e en s o eme gencies and how o eco e om hem (Sa age, 2002). As a managemen concep he in eg a ion in o an o ganiza ion, is essen ial (Ellio , Swa z and He bane, 2010). Bu i is only he hi d s ep wi hin he business con inui y managemen p ocess ha is shown in igu e 4. A e he ini ia ion, a con inui y plan needs o be de eloped. The e a e di e en app oaches o he planning p ocess (Zsidisin, Melnyk and Raga z, 2005; Pi and Goyal, 2004; Sa age, 2004). They ange om ou o nine s eps and a e simila o isk managemen concep s (Zsidisin, Melnyk and Raga z, 2005). Al hough he p ocess is designed o an en e p ise, he mindse o con inui y managemen oday is a supply chain wide. Immanuel Zi zmann 368 Fig. 4: The business con inui y managemen p ocess (Ellio , Swa z and He bane, 2010) 3.5 An i- agili y The concep o an i- agili y is ac ually no a concep a all. I is mo e an idea which is p omo ed by Taleb (2012). I is based on his ecogni ion o "black swans" (Taleb, 2010). These a e dis up i e e en s ha ha e a low p obabili y o occu ence bu when hey occu hey ha e a la ge impac on he co esponding sys em. I he sys em is an i- agile i would no lose bu p o i om he e ec . In he con ex o his pape he sys em would be he supply chain. The idea o an i- agili y is o c ea e a alue ne wo k ha h i es om an impac as shown in igu e 5. The e o e, an i- agili y is de ined as "any hing ha has mo e upside[s] hen downside[s] om andom e en s" (Taleb, 2012). How ha should be achie ed is no clea . A concep o amewo k s ill needs o be de eloped. Fig. 5: Pe o mance o an i- agile and agile sys ems 4. Di e ences and syne gies To in e ela e he concep s in oduced in he p eceding chap e , we will i s look a ou aspec s in o de o iden i y di e ences and simila i ies. The  How o Cope wi h Unce ain y in Supply Chains? 375 Re e ences Adamou, C., 2014. Business con inui y managemen in in e na ional o ganisa ions. Jou nal o Business Con inui y & Eme gency Planning, 7(3), pp. 221-229. B i ish S anda ds Ins i u e, 2006. BS25999-1 Code o P ac ice o Business Con inui y Managemen and BS25999-2 Speci ica ion o Business Con inui y Managemen . London: B i ish S anda ds Ins i u e. 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Ringle Co e design F ede ik Duchâ eau, Mo i z Pe e sen Co e pho o Vik o Rosen eld / lic.k /p/e7ujK3 (CC BY-SA 2.0) ISBN 978-3-7375-0339-6 Copy igh : This book a e licensed unde he C ea i e Common A ibu ion-Sha eAlike 4.0 In e na ional License. This book can be downloaded a HICL (hicl.o g) o a he TUBdok – Publica ion Se e o he Hambu g Uni e si y o Technology (doku.b. u-ha bu g.de) – ISBN: 978-3-7375-0339-6 A p in ed e sion o his is a ailable in you lib a y o book s o e – ISBN 978-3-8442-9879-6 An al e na e e sion o you ebook eade is a ailable h ough online ebook s o es – ISBN: 978-3-7375-0340-2 P e ace Today’s business en i onmen is unde going signi ican changes. Demand pa e ns cons an ly claim o g eene p oduc s om mo e sus ainable supply chains. Handling hese cus ome needs, embedded in a sophis ica ed and complex supply chain en i onmen , a e pu ing he playe s unde a cons an p essu e: Ecological and social issues a ise addi ionally o challenges like echnology managemen and e iciency enhancemen . Concu en ly each o hese holds inc edible oppo uni ies o sepa a e om compe i o s, ye also inc eases chain complexi y and isks. This book add esses he ho spo s o discussion o u u e supply chain solu ions. I con ains manusc ip s by in e na ional au ho s p o iding comp ehensi e insigh s in o opics like sus ainabili y, supply chain isk managemen and p o ides u u e ou looks o he ield o supply chain managemen . All manusc ip s con ibu e o heo y de elopmen and e i ica ion in hei espec i e a ea o esea ch. We would like o hank he au ho s o hei excellen con ibu ions, which ad ance he logis ics esea ch p og ess. Wi hou hei suppo and ha d wo k, he c ea ion o his olume would no ha e been possible. We would also like o hank Sa a Khei a a , Tabea T essin, Ma hias Ehni and Niels Hackius o hei e o s o p epa e, s uc u e and inalize his book. Hambu g, Augus 2014 P o . D . D . h. c. Wol gang Ke s en P o . D . Tho s en Blecke P o . D . Ch is ian Ringle Table o Con en s I. A Look In o he Fu u e - Oppo uni ies and Th ea s Iden i ica ion o Mega ends A ec ing Complexi y in Logis ics Sys ems............. 3 Wol gang Ke s en, Bi gi on See and Henning Ski de Planning App oach o Robus Manu ac u ing Foo p in Decisions .................. 29 Philipp Sp enge , Ma hias Pa lings and Tobias Hegmanns Fu u e P oblems in Logis ics Due o Demog aphic Change ............................. 51 Ma hias Klumpp, Sascha Bioly and Ch is ian Wi e Logis ics T ends 2020: A Na ional Delphi S udy Conce ning he Ge man Logis ics Sec o ................................................................................................ 69 S ephan Zelewski, Alessa Münchow-Küs e and René Föh ing Vision o a Se ice Value Ne wo k in Ma i ime Con aine Logis ics .................. 87 Jü gen W. Böse, Ca los Jahn and Raman Sa in II. Sus ainabili y E o s Wi hin he Supply Chain Logis ics Pe o mance Measu emen o Sus ainabili y in he Fas Fashion Indus y ........................................................................................................... 113 Anna Co inna Cagliano, Muhammad Salman Mus a a, Ca lo Ra ele and Gio anni Zenezini Design o Sus ainable T anspo a ion Ne wo ks ............................................. 137 Wendelin G oss and Ch is ian Bu z Explo ing Sus ainabili y in Cons uc ion Supply Chains.................................. 161 Ma ghe i a Pe o, Eleono a Bo ani and Ba ba a Biglia di VII Table o Con en s Is Money Really G een? - An In es iga ion In o En i onmen al Supply Chain P ac ices, wi h a Cos Focus .......................................................................... 183 John Banc o Rele an Pu chase C i e ia o Basic Requi emen : Cus ome Pe spec i es on G een Logis ics .............................................................................................. 195 Ma hias Klumpp, Julia Nask en and Nikolaus A. D. Hohl In o ma ion Sys ems and Re e se Logis ics: Examining D i e s o Implemen a ion on Mul iple Case S udy Scena io .......................................... 211 Josip Ma ic, Flo ence Rodhain and Y es Ba le e Analysing he Role o Rail in U ban F eigh Dis ibu ion ................................. 223 Ka ien De Langhe T uck Loading Dock P ocess – In es iga ing In eg a ion o Sus ainabili y ...... 245 Niels Hackius and Wol gang Ke s en How o A ac Ai F eigh Business: De ining C i ical Success Fac o s o Regional Ai po s ............................................................................................ 273 Da id M. He old, Simon Wilde and Na alie Woj a owicz Ea ly Supplie In eg a ion in Cas P oduc De elopmen Pa ne ships – A Mul iple Case S udy o En i onmen al and Cos E ec s in he Ge man Found y Value Chain .................................................................................................... 289 Robe Ch is ian Fandl, Tobias Held and Wol gang Ke s en Sus ainable Logis ic Scena ios in he NSR Region ........................................ 311 Jacob K onbak, Angela Münch, Liping Jiang and Lisbe h B øde Jepsen III. Handling Risk - Concep s Towa ds Robus SCM A Se ice P oduc ion Planning Model In eg a ing Human Risk Fac o s ......... 345 Nguyen Vi Cao and Emmanuel F agnie e VIII Table o Con en s How o Cope wi h Unce ain y in Supply Chains? - Concep ual F amewo k o Agili y, Robus ness, Resilience, Con inui y and An i-F agili y in Supply Chains ....................................................................................................................... 361 Immanuel Zi zmann Flexible Supply Chain Design unde S ochas ic Ca as ophic Risks .............. 379 Yingjie Fan, F ank Schwa z and S e an Voß A Risk Managemen App oach o he P e-Se ies Logis ics in P oduc ion Ramp-Up ........................................................................................................ 407 Pa ick Filla and Ka ja Klingebiel The Imbalance o Supply Risk and Risk Managemen Ac i i ies in Supply Chains: De eloping Me ics o Enable Ne wo k Analysis in he Con ex o Supply Chain Risk Managemen .................................................................... 423 Ch is ian Zube , Hans-Ch is ian P ohl and Ul ich Be bne Risk Assessmen in Managing he Blood Supply Chain ................................. 447 Phongchai Ji amai and Wijai Boonyanusi h Supply Chain Risk Managemen in In e na ional T ade Ope a ions Be ween Ge many and B azil ........................................................................................ 469 Meike Sch oede and Rena o Ba a a Gomes The Fo es Supply Chain Managemen : An En opic Pe spec i e .................. 487 Ta ik Saikouk, Ismail Bad aoui and Alain Spalanzani A Mul i-Agen Based App oach o Risk Managemen in a Po Con aine Te minal ......................................................................................................... 515 Lo ena Bea zo i and Rosa Gonzalez Au ho s ............................................................................................................ 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