Flexibility in Global Supply Chains: A Hybrid Energy Consumption Simulation Approach

The modern manufacturing industry often relies on complex global supply chains requiring extensive production procedures and flexible and robust supply chain management. The more flexible the supply chain, the easier it responds to disruptions. Flexibility, however, comes with a toll, such as environmental impacts and flexibility inherent costs. This study presents a simulation model based on a robust design framework to analyze and overcome these challenges. The model uses a multi-method simulation approach called ‘processes inside agents’ hybridly combining Discrete Event Simulation and Agent-Based Modeling to investigate an optimum point of flexibility regarding the energy consumed. An enhanced flexibility formula developed reveals the impact of the used flexibility in the supply chain network. The study illustrates that limited flexibility can achieve better results than higher flexibility for lowering the energy consumption per product. The results also demonstrate that no single optimum point of flexibility can generate optimal results for the whole supply chain network. However, there is a local and case-specific optimum point of flexibility for each degree of forecast accuracy.