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Industrial Engineer Engineering and Management Solutions at Work

March 2014    |    Volume: 46    |    Number: 3

The member magazine of the Institute of Industrial Engineers

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Costly supply chain disruptions

Intelligent software helps increase visibility and resilience

By Denis Hübner, Tobias Larsson, Stephan M. Wagner and Andrea Christ

Specialization and globalization have resulted in a world of highly complex supply and demand networks. These world-spanning networks allow corporations to tap regional know-how and resources to offer cost advantages. During the recession that resulted from the financial crisis of 2008, numerous cost saving programs optimized supply chains and reduced slack wherever possible. When the tide turned and economies began to recover, the increased efficiency led to record profits for manufacturing firms. But such efficiency comes at a cost: Complex and tightly coupled systems such as modern supply chains are extremely vulnerable to internal and external shocks.


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