Modelling of Supply Chain Risk Contagion Based on System Dynamics

Abstract

In view of the risk contagion in supply chain (SC) regarded as a complex and non-linear system and its severe threat to the entire SC system, it is very necessary for the research on risk contagion of SC. Based on the analysis of risk contagion process for SC and the theory of system dynamics, from the perspective of the risk management decision-making behavior of enterprise in SC, this paper creatively constructs the risk contagion model. Next, simulation for this model was carried out to explore the evolution and mechanism of SC risk contagion, and reveal the risk contagion effects of individual enterprises on SC system. The results show that enterprises with different risk resistances have different abilities to control risk contagion, and need to start risk control under different conditions. Thus, the longer the incubation period of the SC risk, the more harmful the risk contagion for the three types of enterprises. At the same time, enterprises with different risk resistance and risk control capabilities, the contagion effect of risk in the three types of enterprises are different, enterprise should develop different strategies for risk management decisions at different times. Moreover, for enterprises in SC, enhancing their risk immunity is far more important than simply emphasizing risk control technology. On some extent, the research findings can help risk decision-makers verify the feasibility of risk control strategies, also help enterprises to analyze the contagious risks being faced, and to take effective measures to avoid those problems. It can also provide some reference to scholars for the related study.

Risk Management System at an Engineering Enterprise in Conditions of Ensuring Security

“…Examining the literature of leading scientists [1][2][3], we found that most of them support the view that risk management is a specific, solitary management process that plays an auxiliary role in the management system of an engineering enterprise. It becomes especially important in an unstable economy, so ignoring or non-systematic implementation of risk management functions harms the performance of the entire enterprise.…”

Modeling of the Assessment System of the Main Risks of Investing in Engineering Enterprises in the Conditions of the Development of the Knowledge Economy

“…In general, the number of existing risks of investing in an enterprise is practically no limit. For example, longing for those only known and presented in the scientific and practical literature Kryshtanovych et al [4], Jiang and Liu [5], Lorincová et al [6], we can talk about almost 200 such risks. Among them, there are systematic, arising at the macro level and not dependent on the activities of the economic entity, and non-systemic risks, which the enterprise can influence in a certain way.…”