Resilience of interdependent supply chain networks design and protection under the ripple effect

Abstract

Firms painstakingly assemble vast supply networks of cyber and physical interdependence. Wars, pandemics, and cyber-attacks have disrupted and rippled recently through these networks. The ripple effect in interdependent networks can be caused by functional and structural failures simultaneously, known as mixed ripple effects, which have been studied less in the past. To help managers enhance network resilience against mixed ripple effects, we propose a design and protection strategy from a network structure perspective. This paper is the first to propose a growth-maturity-decline (GMD) model for designing an interdependent network structure. Then, a protection strategy based on node collaboration and redundancy is proposed. Considering that a single resilience metric makes it difficult to distinguish the performance of different strategies, we develop a three-dimensional quantitative framework to evaluate network resilience by conducting case studies on synthetic and real-life supply chain networks. The simulation results indicate that (i) the GMD model enhances network resilience at different phases; (ii) the threshold of the upper capacity limit parameter for cyber-supply networks is 2.7; and (iii) the more uniform the role distribution of firms, the more resilient the network is. This study can provide more informed management decision support for improving network resilience.