Supply-side risk modelling using Bayesian network approach

ABSTRACT

Organisations’ vulnerability to risks exponentially increased in the past decade, thereby highlighting the need to develop additional effective risk management strategies. This research uses a systematic literature review as a foundation for designing a supply risk model that uses a Bayesian belief network. The proposed model aims to identify the most critical objective and subjective risk factors influencing supply chain networks. Moreover, the proposed methodology has been demonstrated through a case study conducted in an Indian manufacturing, in which inputs were taken from supply chain and risk management experts. Hugin Expert software was used to design and run simultaneous simulations on the Bayesian network. The top three factors found to influence business profitability were delays, product technology, and fuel price. The proposed model can be reengineered as conditions change and new information becomes available, thereby ensuring that risk analysis remains current and relevant along the timeline of the any disruption.

KEYWORDS:

• Supply-side risk
• modelling
• Bayesian network
• sensitivity analysis

Disclosure statement

No potential conflict of interest was reported by the author(s).

Additional information

Notes on contributors

Satyendra Kumar Sharma

Dr. Satyendra Kumar Sharma is BE, MBA from MNIT Jaipur and PhD from BITS Pilani. Dr. Sharma carried out his Phd research on Supply chain risk management. He has more than 2 years of experience in industry and 14 years in academics. Currently he is working as a Associate Professor in Department of Management. He has served as Nucleus member of planning cell in Practice school division, BITS Pilani. Currently he is also heading Center for Innovation, Incubation and Entrepreneurship (CIIE). His research interest areas are Supply Chain Risk Management, Project Risk Management and Multicriteria Modelling. He has successfully completed two sponsored R & D Projects. He has published more than 50 papers in international journals of repute, and more than 22 papers in international conferences and four Case studies. He has guest edited tow special issues of Emerald Publishing. He has conducted several MDP’s. He is a member of professional bodies like Society of operations and production management and AIMS international

Srikanta Routroy

Srikanta Routroy received the Bachelor of Technology Degree in Mechanical Engineering from College of Engineering and Technology, Bhubaneswar and the Master of Technology Degree in Industrial Engineering and Management from IIT, Kharagpur. He received the PhD Degree in the area of Supply Chain Management from Birla Institute of Technology and Science (BITS) Pilani, Pilani. He is currently working as an Associate Professor (Mechanical Engineering Department) in Birla Institute of Technology and Science Pilani, Pilani. His research interests are in the areas of supply chain management, production and operations management, evolutionary computation and manufacturing management.

Udayan Chanda

Udayan Chanda is currently working as Associate Professor in Department of Management, Birla Institute of Technology & Science (BITS) Pilani. Earlier he was associated with Industrial Statistics Lab., Department of Information & Industrial Engineering Yonsei University as Post Doctoral Fellow and Department of Operational Research, University of Delhi as Assistant Professor (Ad-hoc). He received his Ph.D. degree in Marketing Models and Optimization (Operational Research) from University of Delhi, Delhi. He has published numerous papers in the area of Marketing Models, Optimization, Software Reliability and Inventory Management in international journals and conference proceedings. His current research interests include Marketing Models, Inventory Modeling, Software Reliability Growth Modeling, and Dynamic Optimization Techniques.