Outsourcing strategy for supply chain resilience to unexpected production disruptions

Supply chain resilience has been receiving an attention for the risk management. In this paper, we propose a rescheduling strategy in order to recover the productivity of supply chain after facing unexpected disruptions in manufacturing companies. When suppliers suspend manufacturing processes due to disruptions and products cannot satisfy a given due date, the suppliers reduce the delays and penalty charges for the delays by contracting out the delayed products to external suppliers and restore production capacity to the state before the disruption occurs. This research proposes priority rules using dispatching rules in order to select suitable products for outsourcing from the delayed ones. We carried out computational experiments through the developed simulation system of supply chains. The experimental results demonstrate that outsourcing is effective for the recovery of productivity in supply chains.