Robust bi-level optimization of relief logistics operations

Abstract

• A hierarchical decision processes with two levels of decision as a robust bi-level optimization model. • Addressing both supply risk and relief items demand coverage robustness. • Optimizing relief operating costs as well as considering penalty cost for unsatisfied victims demand. • TOPSIS method is employed to identify candidate suppliers with lower risk. In this paper, a robust bi-level optimization model is developed for a supply–distribution relief network under uncertainty in demand and supply parameters. It optimizes the relief operating costs as well as considering a penalty term for unsatisfied victims’ demands. Moreover, the proposed framework optimizes the relief commodity flow in a relief chain along with the supply risk minimization by identifying the suppliers with a lower risk. This paper proposes an integrated optimization method in which the supply risk value for each supplier is obtained via the TOPSIS method. Next, these values are utilized in a robust bi-level model to select appropriate suppliers and allocate orders. Finally, the robustness and effectiveness of the proposed model are demonstrated by a case of flood disaster.