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Exiting the COVID-19 pandemic: after-shock risks and avoidance of disruption tails in supply chains
(2021)
Entering the COVID-19 pandemic wreaked havoc on supply chains. Reacting to the pandemic and adaptation in the “new normal” have been challenging tasks. Exiting the pandemic can lead to some after-shock effects such as “disruption tails.” While the research community has undertaken considerable efforts to predict the pandemic’s impacts and examine supply chain adaptive behaviors during the pandemic, little is known about supply chain management in the course of pandemic elimination and post-disruption recovery. If capacity and inventory management are unaware of the after-shock risks, this can result in highly destabilized production–inventory dynamics and decreased performance in the post-disruption period causing product deficits in the markets and high inventory costs in the supply chains. In this paper, we use a discrete-event simulation model to investigate some exit strategies for a supply chain in the context of the COVID-19 pandemic. Our model can inform managers about the existence and risk of disruption tails in their supply chains and guide the selection of post-pandemic recovery strategies. Our results show that supply chains with postponed demand and shutdown capacity during the COVID-19 pandemic are particularly prone to disruption tails. We then developed and examined two strategies to avoid these disruption tails. First, we observed a conjunction of recovery and supply chain coordination which mitigates the impact of disruption tails by demand smoothing over time in the post-disruption period. Second, we found a gradual capacity ramp-up prior to expected peaks of postponed demand to be an effective strategy for disruption tail control.
The coronavirus (COVID-19) outbreak shows that pandemics and epidemics can seriously wreak havoc on supply chains (SC) around the globe. Humanitarian logistics literature has extensively studied epidemic impacts; however, there exists a research gap in understand-ing of pandemic impacts in commercial SCs. To progress in this direction, we present a systematic analysis of the impacts of epidemic outbreaks on SCs guided by a structured lit-erature review that collated a unique set of publications. The literature review findings sug-gest that influenza was the most visible epidemic outbreak reported, and that optimization of resource allocation and distribution emerged as the most popular topic. The streamlining of the literature helps us to reveal several new research tensions and novel categorizations/classifications. Most centrally, we propose a framework for operations and supply chain management at the times of COVID-19 pandemic spanning six perspectives, i.e., adap-tation, digitalization, preparedness, recovery, ripple effect, and sustainability. Utilizing the outcomes of our analysis, we tease out a series of open research questions that would not be observed otherwise. Our study also emphasizes the need and offers directions to advance the literature on the impacts of the epidemic outbreaks on SCs framing a research agenda for scholars and practitioners working on this emerging research stream.