Can anticipatory supply chain decision making manage the pandemic's effect? A regime switching game

Arka Mukherjee; Anirban Ganguly; Chitresh Kumar; Priyabrata Chowdhury

doi:10.1016/j.ifacol.2022.09.571

Can anticipatory supply chain decision making manage the pandemic's effect? A regime switching game

IFAC Pap OnLine. 2022;55(10):1307-1312. doi: 10.1016/j.ifacol.2022.09.571. Epub 2022 Oct 26.

Authors

Arka Mukherjee¹, Anirban Ganguly², Chitresh Kumar², Priyabrata Chowdhury³

Affiliations

¹ Concordia University, Montreal, Quebec, Canada.
² O. P. Jindal Global University, Sonipat, Haryana, India.
³ RMIT University, Melbourne, Victoria, Australia.

Abstract

The COVID-19 pandemic has shown that stock outs of essential items like hand sanitizers, tissue papers and other items of hygiene and daily use have been characteristic of a supply chain, especially immediately following a pandemic wave. Consequently, retailers have to indulge in substantial supplier management efforts to ensure product availability during a pandemic wave. Using a piecewise deterministic differential game, we model a scenario where, while anticipating a pandemic wave, a supplier decides on product availability efforts to ensure product availability under the impending threat of stock outs. A market leader coordinating retailer, on the other hand, decides on the proportion of the costs of the efforts to be shared with the supplier.

Keywords: Pandemic; cost-sharing; differential game; product availability; stochastic regime switching.