Robustness of multimodal and multi-commodity production and distribution chains

[Pieter Vansteenwegen]

[for professor Ben Immers - I hope this is the right place to put this proposal]
A possible innovative research concept:

Robustness of multimodal and multi-commodity production and distribution chains

The production and distribution infrastructure of many companies is becoming more and more intertwined. Some important reasons explaining this development are (amongst others) trends in customer oriented production, lean production methods, the extreme limitation of stocks, the effort to accelerate throughput time, etc.. In order to survive the competition with other companies higher demands are imposed on the efficiency and effectivity of the production and distribution chain. The higher demands reflect themselves in a higher criticality of the integrated production-distribution chain (supply chain, production, warehousing and distribution).
Unfortunately these developments also has severe drawbacks. In further optimising the integrated production and distribution chain it is often overseen that the real world environment exhibits a great variety of characteristics that are often unpredictable in nature, in general difficult to deal with and that these characteristics may subsequently pose a serious threat to the well-functioning of the production-distribution chain.
This is one of the reasons why at present companies are quite often confronted with serious disruptions in their operations. In fact, while focussing on a further improvement of the efficiency of the production-distribution chain one often assumes that each component of the chain will function correctly according to some preformulated specifications in all real world situations. However there is a great variety of situations that may endanger the correct functioning of each of the various separate components of the production-distribution chain, thereby jeopardising the functioning of the chain as a whole. A consequence of the above evolution is that the production-distribution infrastructure in many Western European countries is becoming more and more vulnerable. Examples of factors responsible for this situation are growing congestion on the infrastructure network (supply and distribution network), strikes, fire, bankruptcies of suppliers, faulty implementations of WMS or ERP systems, and the effects of external disruptions such as natural disasters or political unrest.

This research proposal aims at a better understanding of the mechanisms that influence the vulnerability of the multimodal and multi-comodity production and distribution process. The envisaged end result of this research would consist of the design of an architecture leading to a better insight in the underlying mechanisms. The architecture for the design of a robust production-distribution chain would consist of the following components:
• a functional analysis of the production-distribution chain,
• a specification of the design standards,
• a specification of the design process, integrated production, warehousing and distribution strategies
• a test of the robustness of the designed production and distribution chain.

The architecture should be applicable to all types of production-distribution chains (multi-modal and multi commodity)..

Design Principles for Improving the Robustness of a PDChain
When thinking about robustness it is useful to distinguish four aspects of robustness:
- Redundancy: the robustness of a system can be improved by introducing a certain amount of spare capacity in the network. This spare capacity is often referred to as redundancy.
- Interdependency: congestion in a production-distribution chain should remain localised and should not quickly spread over the entire chain. In a chain with a great deal of interdependency this aspect is very relevant.
- Resilience: this refers to the capability of the production-distribution chain to recover over and over again and as quickly as possible from temporal disturbances.
- Flexibility: flexibility means that the capacity of the various components of the chain can easily adapt to changing circumstances

Definition of Robustness
In this context we define robustness as the extent to which a production and distribution chain is able to maintain the functions it was originally designed for under all circumstances that deviate from normal conditions. Vulnerability is the opposite of robustness.

Indicators for Robustness
Examples of indicators for production-distribution chain robustness could be: spare capacity, availability and quality of alternative components in the chain, time lost in the chain, production loss per time unit, etc.

Specification of design standards
An important consideration in the specification of the design standards of a production-distribution chain is that robustness measures should not impede the other qualities of the chain.

Besides the more technology oriented approach in our research we also intend to address other factors that are known to have a significant influence on the robustness of a production-distribution chain, e.g.:
• to what extent are companies aware of risks in the PDchain
• what are those risks from a company viewpoint and how can they be prioritised.

Feel free to comment on this topic.
Kind regards,
Pieter