Facility location and re-location decisions are critical managerial decisions in modern supply chains. Such decisions are difficult in this environment as managers encounter uncertainty and risks. The study investigates establishing or moving distribution facilities in the global supply chain by considering costs, fulfilment, trade uncertainties, risks under environmental trade-offs and disruptive technologies.
This paper combines the possibilities and probabilistic scenarios for a supply chain network by proposing the novel Robust Optimisation and Mixed Integer Linear Programming (ROMILP) method developed under the potential uncertainty of demand while considering the costs associated with a four-tier supply chain network. ROMILP has been solved in a real-time logistics environment by applying a case study approach.
The solution is obtained using an exact solution approach and provides optimality in all tested market scenarios along the proposed global logistics corridor. A sensitivity analysis examines potential facility location scenarios in a global supply chain context.
Logistics managers can apply the ROMILP model to test the cost-benefit trade-offs against their facility location and relocation decisions while operating under uncertainty. Future research is proposed to extend the literature by applying data from the OBOR logistics corridor.
This study is the first to examine sustainable dimensions along the global logistics corridor and investigate the global container traffic perspective. The study also adds value to the Middle East logistics corridor regarding facility location decisions.
This paper forms part of a special section “Decision Making in Logistics Management in the Era of Disruptive Technologies”, guest edited by Vijay Pereira, Gopalakrishnan Narayanamurthy, Alessio Ishizaka and Noura Yassine.The authors would like to acknowledge the comments provided by three anonymous (double blind) reviewers, whose comments enhanced the quality of this paper. The authors would like to thank the University of Wollongong in Dubai for partially supporting the research through a university research grant and Ms Golnar Behzadi for supporting the data collection process. The authors would also like to thank an anonymous proof reader for proofreading the article, which improved the readability of the paper. Corrigendum: It has come to the attention of the publisher that the Sundarakani, B., Pereira, V. and Ishizaka, A. (2020), “Robust facility location decisions for resilient sustainable supply chain performance in the face of disruptions”, published in The International Journal of Logistics Management, Vol. ahead-of-print No. ahead-of-print, previously listed incorrect affiliations for the authors Vijay Pereira and Alessio Ishizaka. These have now been updated and appear in the online article. The authors sincerely apologise for this.
Sundarakani, B., Pereira, V. and Ishizaka, A. (2021), "Robust facility location decisions for resilient sustainable supply chain performance in the face of disruptions", The International Journal of Logistics Management, Vol. 32 No. 2, pp. 357-385. https://doi.org/10.1108/IJLM-12-2019-0333
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