A novel application of system survival signature in supply chain risk management

Supply chains have become complex because of the globalization and outsourcing, and the lack of visibility across the entire network makes it difficult to manage the risks. The concept of 'System survival signature' has recently been developed for capturing the network configuration of a system comprising different types of components. Its utilization in the evaluation of system reliability is unique in terms of its capability of segregating the network signature from the probability distribution of failure time of components. We introduce this concept in the realm of supply chain risk management. This novel application can be helpful in evaluating supply network reliability through gauging two distinct features of network configuration and risk profiles of the suppliers. The application is illustrated with the help of two simple examples. The technique can be of significant value to the supply chain managers in taking strategic decisions concerning suppliers and network configuration. We have also adapted the existing risk importance measures in the field of reliability engineering for their application in the domain of supply network reliability.