Integrating risk assessment and management and performance measurement in agricultural supply chain using agent-based simulation approach (A Case Study)

Document Type : Research Paper

Authors

1 Ph.D. student of Agricultural Economics, Agriculture Faculty, Ferdowsi University of Mashhad, Mashhad, Iran.

2 Professor of Agricultural Economics, Ferdowsi University of Mashhad, Mashhad, Iran

3 Assistance Professor of Social Sciences, Ferdowsi University of Mashhad, Mashhad, Iran

Abstract

The scope and complexity of activities in food supply chains has exposed this networks to more negative risks, so that decision makers and business actors in this chains are forced to identify and evaluate the risks correctly and also adopting the necessary policies to reduce the likelihood of risks occurrence and severity consequences. The purpose of this study is to investigate and measure the supply chain performance in real conditions under different risks and to analyze it with using agent-based simulation. For this purpose, milk supply chain was studied in Zahedan city during 2018 and 2019 period. In this study, the theoretical sampling method of Strauss and Corbin was used. A regular series of purposefully in-depth and semi-structured interviews was conducted with a group of 24 experts and specialists related to the chain to extract qualitative data. Identified 61 risks in the chain in the field research were initially evaluated using the Failure Mode, Effects and Criticality Analysis, then, the active chains in the region was simulated with the agent-based modeling approach and using Net Logo software, and 27 risk reduction scenarios were examined to evaluate the changes in the performance indicators of the chain. Regarding the validation of the results of simulation tests, paired (t) test was performed and also the results of 30 independent replications of the model was compared with each other. Among the identified various risks in the chain, price fluctuations of agricultural inputs (seeds, fertilizers, labor, etc.), milk price fluctuations and lack of information had the most negative impact on chain performance and as a result of appropriate measures such as the use of marketing and futures contracts and other local tools that reduce the level of risk from high to medium level in the chain, some other performance indicators of the chain can be improved while increasing the overall revenue of the chain.

Keywords

References

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Agricultural Economics
Volume 15, Issue 3 - Serial Number 3
December 2021
Pages 21-54

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