Impact Analysis of Proactive and Reactive Inventory Disruption Management on Supply Chain Performance

Abstract

An inventory management system is a complex network of worldwide components that produce, handle and distribute specific products. This heterogeneous components as well as distributed decision making across such components, make this system a complex network that needs a special kind of activities management. These activities allows company to prevent and react more quickly to the dynamic events. For this purpose, an appropriate modeling and simulation tools that allows system performance analysis under various conditions is required. Agent-based technology has been proven as a suitable approach for modeling such complex networks with distributed actors. This paper illustrates the utility of agent-based modeling to evaluate the impact of disruptions on system performance. The model can be useful to prevent and react against the effects of disruption events. The inventory system’s behavior, as well as the effects of handling strategies during disruption situations, is studied. As an illustrative case, agent-based simulation models of distribution chain that buys and distributes final products are introduced. The major observation from the simulation experiments is that our model can be applied to quantify the impacts of key strategies on system performance compared to the non-use of action.