Study On Supply Networks Risk Management Using System Dynamics

The interdependence between companies has been reinforced by the rapidly changing market. And then, the supply networks appear. In many business environments, networking is almost an inevitable solution to help companies respond fast to market changes. In network collaboration companies deepen their relationship with partners and thus become more dependent on each other. Collaborations among companies not only present the companies with much more profits, but also bring some added risks. As the degree of the dependency between companies increases and deepens, the risks they bring to each other become more uncertain and complex. They bring challenges to risk management in supply networks.This thesis regards the supply networks risk management as the main object. Based on the literature review of the risk management in supply chain, this thesis considers the complexity and dynamics, examines the supply networks as a whole, and researches the risk management in supply networks using the theory of system dynamics. Firstly, I introduce the theory of system dynamics regarded as the theoretical basis of this thesis. Secondly, I introduce the meaning of supply chain risk and the concept of supply chain risk management. And then, analyze the nature of supply networks and supply networks risk management. Based on these, I analyze the feasibility of using system dynamics to supply networks risk management. Then I build up a model of supply networks risk management using system dynamics. The conclusions illustrate that using system dynamics can efficiently work out the complex and dynamic problems in supply networks risk management. The case study illustrates that the severities of risk factors have been changed because of the interaction between different risk factors. And some counterintuitive results are obtained as considering the feedbacks.