Facility location decisions with random disruptions and imperfect estimation

Manufacturing and Service Operations Management

Volumn 15, Issue 2, 2013, Pages 239-249

  Lim, Michael K ^a   Bassamboo, Achal ^b   Chopra, Sunil ^b   Daskin, Mark S ^c  

^a UNIVERSITY OF ILLINOIS AT URBANA CHAMPAIGN   (United States)

^b NORTHWESTERN UNIVERSITY   (United States)

^c UNIVERSITY OF MICHIGAN   (United States)

Author keywords

Continuous approximation; Correlated disruptions; Estimation error; Facility network design; Logistics and transportation; Supply chain disruptions

Indexed keywords

CONTINUOUS APPROXIMATIONS; CORRELATED DISRUPTIONS; ESTIMATION ERRORS; LOGISTICS AND TRANSPORTATIONS; NETWORK DESIGN; SUPPLY-CHAIN DISRUPTIONS;

COSTS; ESTIMATION; SUPPLY CHAINS;

PROBABILITY;

EID: 84881298732     PISSN: 15234614     EISSN: 15265498     Source Type: Journal    
DOI: 10.1287/msom.1120.0413     Document Type: Article

References (37)

1. Bakkaloglu M, Wylie JJ, Wang C, Ganger GR (2002) On correlated failures in survival storage systems. Technical Report CMUCS- 02-129, Carnegie Mellon University, Pittsburgh.
2. Ball MO, Lin FL (1993) A reliability model applied to emergency service vehicle location. Oper. Res. 41(1): 18-36.
3. Baron O, Berman O, Krass D (2008) Facility location with stochastic demand and constraints on waiting time. Manufacturing Service Oper. Management 10(3): 484-505.
4. Batta R, Mannur NR (1990) Covering-location models for emergency situations that require multiple response units. Management Sci. 36(1): 16-23.
5. Beckmann M (1968) Location Theory (Random House, New York).
6. Ben-Tal A, Chung BD, Mandala S, Yao T (2011) Robust optimization for emergency logistics planning: Risk mitigation of humanitarian relief supply chains. Transportation Res. B. 45(8): 1177-1189.
7. Berman O, Krass D, Menezes M (2007) Facility reliability issues in network p-median problems: Strategic centralization and colocation effects. Oper. Res. 55(2): 332-350.
8. Berman O, Krass D, Menezes M (2009) Locating facilities in the presence of disruptions and incomplete information. Decision Sci. 40(4): 845-868.
9. Chopra S, Sodhi MS (2004) Managing risk to avoid supply-chain breakdown. MIT Sloan Management Rev. 46(1): 53-61.
10. Chopra S, Reinhardt G, Mohan U (2007) The importance of decoupling recurrent and disruption risks in a supply chain. Naval Res. Logist. 54(5): 544-555.
11. Church RL, Scaparra MP (2007) Protecting critical assets: The r-interdiction median problem with fortification. Geographical Anal. 39(2): 129-146.
12. Cui T, Ouyang Y, Shen Z-JM (2010) Reliable facility location design under the risk of disruptions. Oper. Res. 58(4): 998-1011.
13. Daganzo CF (2005) Logistics System Analysis, 4th ed. (Springer, Berlin).
14. Daganzo CF, Erera AL (1999) On Planning and Design of Logistics Systems for Uncertain Environments, in New Trends in Distribution Logistics (Springer, Berlin).
15. Dasci A, Verter V (2001) A continuous model for productiondistribution system design. Eur. J. Oper. Res. 129(2): 287-298.
16. Drezner Z, Hamacher HW (2002) Facility Location: Applications and Theory (Springer, Berlin).
17. Hall RW (1984) Travel distance through transportation terminals on a rectangular grid. J. Oper. Res. Soc. 35(12): 1067-1078.
18. Hendricks KB, Singhal VR (2005) An empirical analysis of the effect of supply chain disruptions on long-run stock price performance and equity risk of the firm. Production Oper. Management 14(1): 35-52.
19. Kleindorfer PR, Saad G (2005) Managing disruption risks in supply chains. Production Oper. Management 14(1): 53-68.
20. Langevin A, Mbaraga P, Campbell JF (1996) Continuous approximation models in freight distribution: An overview. Transportation Res. B. 30(3): 163-188.
21. Li X, Ouyang Y (2010) A continuum approximation approach to reliable facility location design under correlated probabilistic disruptions. Transportation Res. B. 44(4): 535-548.
22. Li J, Chen J, Wang S (2011) Risk Management of Supply and Cash Flows in Supply Chains (Springer, New York).
23. Lim M, Daskin MS, Bassamboo MA, Chopra S (2010) A facility reliability problem: Formulation, properties and algorithm. Naval Res. Logist. 57(1): 58-70.
24. Mak HY, Shen ZJ (2011) Agility and proximity considerations in supply chain design-An analytical approach. Working paper, Hong Kong University of Science and Technology, Hong Kong.
25. Munich Re Group (2008) Topics Geo natural catastrophes 2007. Report. Accessed August 2011, http://www.munichre .com/publications/302-05699-en.pdf.
26. Newell GF (1973) Scheduling, location, transportation and continuous mechanics: Some simple approximations to optimization problems. SIAM J. Appl. Math. 25(3): 346-360.
27. Ouyang Y, Daganzo CF (2006) Discretization and validation of the continuum approximation scheme for terminal system design. Transportation Sci. 40(1): 89-98.
28. Pirkul H, Schilling DA (1988) The siting of emergency service facilities with workload capacities and backup service. Management Sci. 34(7): 896-908.
29. Rice JB, Caniato F (2003) Building a secure and resilient supply network. Supply Chain Management Rev. 7(5): 22-30.
30. Sheffi Y, Rice J (2005) A supply chain view of the resilient enterprise. MIT Sloan Management Rev. 47(1): 41-48.
31. Snyder LV, Daskin MS (2005) Reliability models for facility location: The expected failure cost case. Transportation Sci. 39(3): 400-416.
32. Snyder LV, Daskin MS (2006) Stochastic p-robust location problems. IIE Tran. 38(11): 971-985.
33. Swiss Re (2009) Sigma report: Natural catastrophes and Manmade disasters. Report. Accessed August 2011, http://www .swissre.com/resources/ dd6346004d4e9669ac76eecedd316cf3 -sigma2-2009-e.pdf.
34. Taleb N (2007) The Black Swan: The Impact of the Highly Improbable (Random House, New York).
35. Tang CS (2006) Perspectives in supply chain risk management. Internat. J. Production Econom. 103(2): 451-488.
36. Tomlin B (2006) On the value of mitigation and contingency strategies for managing supply chain disruption risks. Management Sci. 52(5): 639-657.
37. Wang N, Lu JC, Kvam P (2006) Reliability modeling in spatially distributed logistics systems. IEEE Tran. Reliability 55(3): 525-534.