Disruption Propagation in Global Supply Networks

Supply chain disruptions are interruptions in the flow of materials, services, or information (Kleindorfer und Saad 2005) and entail adverse effects for organizations and their supply chains (Hendricks und Singhal 2003). The propagation of a disruption’s effect in the supply network is referred to as the ripple-effect (Ivanov et al. 2014). Accordingly, organizations are exposed to events that disrupt their operations and the operations of supply chain partners upstream. Structural drivers affect the frequency of supply chain disruptions (Bode und Wagner 2015), which are vertical, horizontal, and spatial complexity (Choi und Hong 2002). In this research, we propose that disruption propagation is a function of vertical, horizontal, and spatial complexity. We consider several scenarios of disruption and build a simulation
model to test how structural complexity emerges and affects the spread of a disruption. To validate the simulation model, we use data from the retail industry. Specifically, we pose the following research question: Does structural complexity (vertical, horizontal, and spatial) affect the extent of disruption propagation in several disruption scenarios?