Flexibility and Fragility: The Use of Chaining Strategies in the Presence of Disruption Risks

In this paper, we extend the concept of chaining introduced by Jordan and Graves (1995) for designing a robust supply chain network in which the link and nodes are susceptible to disruptions. We introduce the concept of fragility to quantify the change in system performance resulting from a disruption. Although one may anticipate that networks with longer chains will be more robust (smaller fragility) than shorter ones, our study reveals that this is not always true. We show that the fragility with respect to a single link failure decreases as the size of the chain decreases; however, the fragility with respect to a single node failure increases as the size of the chain increases. We also show that multiple failures in a network can be decomposed into a set of multiple subnetworks with a single failure; hence we can analyze the impact of large-scale disruptions by studying each single failure networks. Simulation experiments are used to extend insights from single link or node failures to multiple failure cases.