A Simulation Based Evaluation Approach for Supply Chain Risk Management Digitalization Scenarios

Supply Chain wide proactive risk management based on real-time risk related information transparency is required to increase the security of modern, volatile supply chains. At this time, none or only limited empirical/objective information about digitalization benefits for supply chain risk management is available. A method is needed, which draws conclusion on the estimation of costs and benefits of digitalization initiatives. The paper presents a flexible simulation based approach for assessing digitalization scenarios prior to realization. The assessment approach is integrated into a framework and its applicability will be shown in a case study of a German steel producer, evaluating digitalization effects on the Mean Lead time-at-risk.