Visualisation of ripple effect in supply chains under long-term, simultaneous disruptions: a system dynamics approach

Abstract

Supply chains (SCs) are exposed to multiple risks and vulnerable to disruption propagation
\n(i.e., the ripple effect). Despite established literature, quantitative analysis of the ripple effect
\nin SCs considering simultaneous, long-term disruptions (i.e., induced by the COVID-19
\npandemic) remains limited. This study defines, applies and demonstrates the capability of
\nsystem dynamics modelling to recognise and visualise the ripple effect subject to supply,
\ndemand, and logistics disruptions as well as a combined, simultaneous disruption of supply,
\ndemand and logistics. Simulation results for these four risk scenarios indicate that disruption
\npropagation and its impacts vary based on risk type, combination of risks and the impacting
\nnode. The bi-directional, increasing effect is significant for disruptions of longer duration.
\nRetailers and manufacturers are most fragile to multiple disruptions due to broader risk
\nexposure points. In generalised terms, systems theory-based study provides insights into the
\ncomplex behaviour of simultaneous risks and associated disruptions occurring at a node and
\nacross the SC. The outcomes derived can help practitioners visualise and recognise the dynamic
\nnature of the ripple effect cascading across the SC network. In addition, some novel insights
\non the systemic nature and delayed impact of disruption propagations are uncovered and
\ndiscussed.