Enhancement of supply chain resilience through inter-echelon information sharing

Supply chains in the globally interconnected society have complex structures and thus are susceptible to disruptions such as natural disasters and diseases. The impact of the risks and disruptions that occur to one business entity can propagate to the entire supply chain. However, it has been proposed that cooperation amongst business entities can mitigate the impact of the risks. This paper aims to investigate the value of information sharing in a generalized three-echelon supply chain. The supply chain model is built in a system dynamics software, and three decision-making rules based on different levels of information sharing are developed. Performances of the three ordering policies with shock applied are compared. The results of the experiments prove the value of information sharing in the supply chain when shock exists.