We review empirical evidence from practice and general theoretical conditions, under which simple rules of thumb can help to make operations flexible and robust. An operation is flexible when it responds adaptively to adverse events such as natural disasters; an operation is robust when it is less affected by adverse events in the first place. We illustrate the relationship between flexibility and robustness in the context of supply chain risk. In addition to increasing flexibility and robustness, simple rules simultaneously reduce the need for resources such as time, money, information, and computation. We illustrate the simple-rules approach with an easy-to-use graphical aid for diagnosing and managing supply chain risk. More generally, we recommend a four-step process for determining the amount of resources that decision makers should invest in so as to increase flexibility and robustness.
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June 2018
Research Article|
June 05 2018
Less can be more: How to make operations more flexible and robust with fewer resources
Special Collection:
Supply Network Dynamics
Çağrı Haksöz;
Çağrı Haksöz
a)
1
Krannert School of Management, Purdue University
403 W. State St., West Lafayette, Indiana 47907, USA
and Indian School of Business
, Gachibowli, Hyderabad, Telangana 500 111, India
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Konstantinos Katsikopoulos;
Konstantinos Katsikopoulos
b)
2
Southampton Business School, University of Southampton
, Highfield, Southampton SO17 1BJ, United Kingdom
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Gerd Gigerenzer
Gerd Gigerenzer
c)
3
Max Planck Institute for Human Development, Harding Center for Risk Literacy
Lentzeallee 94, 14195 Berlin, Germany
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Chaos 28, 063102 (2018)
Article history
Received:
January 30 2018
Accepted:
May 14 2018
Citation
Çağrı Haksöz, Konstantinos Katsikopoulos, Gerd Gigerenzer; Less can be more: How to make operations more flexible and robust with fewer resources. Chaos 1 June 2018; 28 (6): 063102. https://doi.org/10.1063/1.5024259
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