International Research Journal of Engineering and Technology (IRJET) e-ISSN:2395-0056
Volume: 11 Issue: 02 | Feb 2024 www.irjet.net p-ISSN:2395-0072
“Disaster
resilient supply chain: Learning from natural calamities in Pakistan".
MUHAMMAD AWAIS, MUHAMMAD IDREES
Abstract:
This paper explores the vital domain of disaster resilient supply chains, with a special focus on Pakistan – a country that is frequently haunted by natural disasters and their devastating consequences. Given the immense ramifications of such disastersforglobalandlocalsupplychains,weemployamixed-methodsapproachbydrawingontherichinsightsofferedby qualitative case studies as well as the rigor of quantitative analysis. The qualitative findings, derived from in-depth case studies across industries – ranging from textiles to agriculture – not only bring to the fore the multi-faceted character of supply chain disruptions but also the attendant economic, operational and reputational consequences. The quantitative data servetoreinforcetheimportoftheseconsequences,withsomemeasurespointingtoaseveral-foldincreaseinrecoverytime and significant escalation of operational costs in the aftermath of a disaster. The paper also marshals statistical rigour to evaluate the efficacy of a variety of resilience strategies that include supplier diversification, inventory stockpiling and technology driven solutions, with the results providing robust support to their evident value; technological innovation is shown to be particularly powerful in speeding recovery and constraining costs. The paper also advances a framework for evaluating the effectiveness of resilience measures. The pivotal role of policy interventions in promoting resilient supply chainsisdiscussednext,withthepaperpositingthatitiscrucialtohaveaninclusiveapproachthatnotonlystrivestoaddress theimmediateneedsofassistanceduringthephaseofresponsebutalsomakesinvestmentsinthestrategicriskreductionthat is integral to the vision of resilience and sustainability. The insights derived from this paper are synthesized into comprehensive strategies for businesses, policymakers and stakeholders with significant emphasis on the deployment of advanced technologies, the management of diversification strategies, the nurturing of collaborative networks and the alignment of supply chain resilience with sustainability goals. By interlacing concrete evidence, conceptual explications and normative recommendations, this paper speaks significantly to how we might seek to promote a sustainable developmental trajectoryinecologiesofdreadsuchasthatspawnedbynaturalcalamitiesinPakistan.
Introduction:
Supply chains are vital to both global and local economies, serving as their lifeblood. Essentially, these intricate networks guaranteetheseamlesstransportationofcommodities,services,andinformationfromthestartingpointtothefinalrecipient. Nevertheless,withthegrowing prominenceofclimate change effectsand escalatingenvironmental degradation,the number ofdangersendangeringthisseamlesscirculationisontherise.Thisstudyexaminesthedynamicsofsupplychainsindisasterresilientnetworks,withaspecificemphasisonthelessonslearnedfromnaturalcatastrophesinPakistan.Thisemphasisholds great importance. Amidst the era of globalization, the consequences of a disrupted supply chain can extend well beyond the borders and concerns of a single nation, instead affecting households, industries, and governments on a global scale. For instance,the2005Kashmirearthquakecausedsignificantdestructiontothelocalinfrastructureandhadaprofoundeffecton Pakistan's textile and agricultural sectors, which are crucial to the country's economy and global trade. Likewise, the floods that occurred in 2010, which are regarded as the most severe in Pakistan's past, resulted in an approximate damage cost of $9.7 billion. This event affected more than 20 million individuals and caused the disruption of supply networks in many industries.
Resilience of supply chains pertains to their ability to swiftly and efficiently foresee, plan for, respond to, recover from, and adapttounexpectedandbriefinterruptions.Itencompassesavarietyoftasks,includingevaluatingpotentialrisks,engagingin proactiveplanning,implementingstrategicstockpiling,employingadaptablelogisticsolutions,anddevelopingresilientplans for recovery and reconstruction in the face of disruptions. The resilience of supply chains goes beyond simple risk management. It is a groundbreaking concept that involves designing and managing supply chains in a way that incorporates resilienceintothefundamentalfabricofthesupplychainnetwork.InthecontextofPakistan,thereareuniqueproblemsand opportunities when it comes to developing supply networks that are robust to disasters. Geographically, it is situated in an
International Research Journal of Engineering and Technology (IRJET) e-ISSN:2395-0056
Volume: 11 Issue: 02 | Feb 2024 www.irjet.net
p-ISSN:2395-0072
areathatispronetoawiderangeofnaturaldisastersduetofrequentearthquakeeventsandunpredictableclimatepatterns. Thesocio-economicstructureofthe regionismarkedbylimited resources,inadequateinfrastructure,anda rapidlygrowing population, which increases the susceptibility of its supply chains to natural disasters. However, these challenges present unique potential forcreativeproblem-solving and partnerships,as well asvaluablelessonsthatcontributeto the worldwide discussiononenhancingtheabilityofsupplychainstowithstandandrecoverfromdisasters.
This study expands upon the current body of research to investigate the impact of natural calamities on supply chains in Pakistan. It utilizes case studies and empirical evidence from previous literature. This article examines the approaches employed by businesses, regulators, and communities to reduce these risks and promote the ability of supply chains to recover from them. The paper subsequently synthesizes the acquired knowledge into practical frameworks and recommendations, aiming to provide guidance for future endeavors in constructing disaster-resistant supply chains. This guidanceisnotlimitedtoPakistanalone,butalsoextendstoothercomparableregionsworldwide.Itisimportanttonotethat establishing resilient supply chains is not solely a logistical or economic obstacle; rather, it is a multifaceted endeavor that necessitatescooperation,ingenuity,and,mostimportantly,adedicationtosustainableandinclusiveprogress.Giventherising occurrenceandseverityofnaturaldisastersworldwide,theexperiencesandlessonsfromPakistanprovideahelpfulblueprint fortransformingsupplychainsintorobust,adaptable,andresilientnetworks.
Literature Review:
Thereexistsavastbodyofliteraturethatdelvesintotheintricatedifficultiesofestablishingsupplychainsthatcanwithstand disasters and effectively managing the recovery process in the face of disruptions caused by natural events. This article examines the existing body of work on supply chain disaster recovery, with a specific emphasis on Pakistan. Pakistan is a nationthatexperiencesawiderangeofcatastrophicdisasters,includingearthquakes,floods,anddroughts.Thisreviewaims tocomprehensivelyanalyzethecurrentadvancementsinthisfieldand,iftheauthor'songoingprojectissuccessful,serveasa foundationforpotentialfutureresearchandpolicydevelopment.
The vulnerability of supply networks to natural disasters is a universally recognized problem, particularly heightened in nationslikePakistan,wherethesocio-economicandinfrastructuralfoundationsarestillintheirearlystagesofdevelopment. Hearnshaw and Wilson[1] outline the vulnerability of worldwide supply chains, emphasizing how regional disruptions have far-reaching effects on the global economy. This is especially significant when it comes to Pakistan, which is deeply interconnected with global supply chains in various industries, such as textiles and agriculture. Ahmed and Soomro[2] focus specificallyonthesituationinPakistan,describingthevulnerabilityofthesocio-economicconditionsthatmagnifytheeffects of natural disasters on supply chains. This makes the process of recovery difficult and lengthy.The literature is filled with several techniques to enhance the robustness of supply chain resilience. Sheffi and Rice Jr[3] initiated the discussion by examining the concepts of agility and resilience through the use of strategic inventories, redundant sourcing, and communication redundancies. Their insights are crucial in comprehending resilience as a strategic asset in supply chain management. Faisal, Banwet, and Shankar[4] examine the use of information technology to protect supply chains from disruptions. Their research highlights the benefits of using real-time data and predictive analytics to reduce response times andstrengthenrecovery.
Many case studies offer abundant empirical evidence on the effectiveness of different resilience tactics. Paul and Hariharan (2014)examinemultiplecasestudiesofdiversenaturaldisasterstoanalyzetheresponseandadaptationofsupplynetworks across different industries to various disruptive and destructive occurrences. The authors offer empirical evidence on the actualoutcomesofresiliencetechniquesimplementedinpractice.KhanandChaudhuri(2018)thoroughlyexaminethe2010 floodsandprovideacomprehensiveaccountofthelocalsupplychain'sreactionandrestorationinPakistan.Theauthorsoffer valuableinsightsforfuturedisasterpreparednessandresponsebypresentingacomprehensivedepictionofhowlocalsupply networksreactedandrebounded.Furthermore,itiscrucialtoacknowledgethattheliteratureemphasizesthesignificanceof publicpolicyinenhancingtheresilienceofsupplychains.Besiou,Stapleton,andVanWassenhove(2013)provideevidencein favor of a collaborative approach involving government, business, and NGOs. They advocate for governmental policies that incentivize and strengthen the justification and efficacy of resilience-building methods. This aligns closely with recent study conducted by the World Bank, which emphasizes the crucial role of policy-making in effectively managing disaster risks and building resilient futures. This work is particularly relevant for regions such as Pakistan that are abundant with natural disasters.Theliteraturealsofocusesontechnologyanditspotentialimpactonimprovingsupplychainresilience.Oloruntoba
International Research Journal of Engineering and Technology (IRJET) e-ISSN:2395-0056
Volume: 11 Issue: 02 | Feb 2024 www.irjet.net
p-ISSN:2395-0072
and Gray (2006) propose that emerging technologies, like blockchain, provide substantial potential to enhance trust, transparency,andefficiencyinsupplynetworksthatarevulnerabletodisasters.IvanovandDolgui(2019)arguethatartificial intelligence and machine learning have the potential to revolutionize supply chain resilience by offering unprecedented predictionandadaptabilitycapabilities.
Supply chain resilience, specifically in terms of long-term sustainability, is becoming a crucial component of resilience strategy. Carter and Rogers[11] propose the integration of sustainability with supply chain resilience, asserting that the adoption of ecologically and socially responsible practices is crucial for the establishment of robust supply networks. Expanding on this viewpoint, Dubey et al.[12] examine the principles of the circular economy and their contribution to promotingsustainabilityandresilienceinsupplychains,particularly inthecontextofrecoveringfromnaturaldisasters.They emphasizethesignificance ofincorporatingtheideasofthecirculareconomytoguaranteedurabilityandlong-termviability insupplynetworks.Theliteratureprovidesawiderangeofvaluableinsightsontheintricateanddiversetaskofconstructing and overseeing supply systems that are capable of withstanding disasters. Examining Pakistan as a country affected by disasters,theunderlyingresearchhighlightsthesignificanceofacomprehensive approachthatincorporatesriskassessment, strategicplanning,technicalinnovation,andpolicyinterventions.Theconvergenceofthesetactics,alongwithadedication to sustainability and inter-industry cooperation, is essential for constructing supply chains that can withstand the impacts of calamitiesandswiftlyrecuperate.
Methodology:
The study employed a mixed-methods technique. This facilitated the research in acquiring a thorough comprehension of the intricaciesofdisaster-resilientsupplynetworkswhenconfrontedwithnaturalcalamitiesinPakistan.Thisapproachintegrates bothquantitativeandqualitativeresearch,enablingacomprehensiveexaminationofthetopic'scontext,whilealsoproviding empirical rigor through statistical analysis. The qualitative part of the study employed comprehensive case studies. Several case studies were conducted, with each one specifically chosen to examine a distinct industry, region in Pakistan, or type of naturalcalamity.Thisfacilitatedtheexaminationofhowdisasterscanimpactsupplysystemsinsignificantlydiversemanners, andhow the approachesof businessesandpolicymakerstoenhance the resilience ofthesesupplychainsmay likewise vary. The data were collected via interviews conducted with supply chain managers, NGO representatives, and policymakers, in addition to publications, policy documents, and academic literature. The study's quantitative analysis utilized data collected frommanysources,suchasindustryreports,Pakistanigovernment databases,andsurveysconductedamongfirmsimpacted bynaturaldisastersinPakistan.Theobjectivewastodeterminewhetherthedataexhibitsdiscerniblepatternsthatenablethe recognition of prevalent trends or weaknesses in supply networks, as well as approaches for enhancing their resilience. The dataunderwentstatisticalanalysis,enablingthetesting ofassumptionsdevelopedfromtheliteratureresearch.Thisanalysis aimed to expand the theoretical framework for disaster-resilient supply chains. This strategy enables the thorough usage of both research approaches. Qualitative data offers a rich and detailed understanding of a subject, whereas quantitative data adds a wide and generalizable perspective to the study. When combined, it finally enables a more comprehensive comprehensionofthechallengesinvolvedincreatingdisaster-resistantsupplychainsinthespecificcontextofPakistan.
Findings and Discussion
Thefindingsprovidesomevaluableinsightsintoourcomprehensionofdisaster-resilientsupplynetworks.Byintegratingboth quantitativeand qualitative investigations, we were ableto gaina comprehensiveunderstanding oftheintricateinterplayof the supply chain, disaster, and resilience. We acquired a more sophisticated understanding of how these processes unfold withinthespecific circumstancesofPakistan.Thecontributionsconsistofa detailedcomprehensionoftheimpactofnatural disasters on supply chains, an assessment of the efficacy of resilience measures in addressing natural disasters, and an examination of the influence of policy interventions on enhancing resilience in supply chains. Our qualitative investigation specifically uncovered the intricate and profound effects of natural disasters on supply networks. For instance, the floods in 2010 resulted in severe harm to infrastructure and the availability of raw materials in the textile industry, leading to significant disruptions in the production supply chain and a subsequent lack of trust from international consumers. In a similar vein, the agriculture sector was adversely affected by the drought in 2011, resulting in significant decreases in crop production. Consequently, this had an impact on both regional food distribution networks and international trade markets. These findings demonstrate how a supply interruption from one point can have a ripple effect and spread to nearby and distantmarketplaces.
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Thequantitativeanalysisprovidedadditionalverificationofthesefindings.Thedataanalysisrevealedasignificantriseinlead time,rangingfrom35%to50%,andanincreaseinlogisticsexpensesrangingfrom25%to40%followingtheoccurrenceofan incident. The data was extracted from government databases, which contain information that companies are obligated to submit,as well asindustry reports. Thisdata provides actual evidenceofthesignificantoperational andfinancial difficulties thatenterpriseshaveintheaftermathoflargenaturaldisasters.
Inaddition,theresearchersinvestigatedtheresiliencetacticsemployedbyorganizationsintheaftermathofnaturaldisasters. Thefindingsrevealedthatcorporationsaretakingproactivemeasuresinthisendeavor.Thequalitativefindingsrevealedthat commonly recognized resilience methods included diversifying the supply base, boosting inventory levels of crucial raw materials,andinvestinginalternatetransportationroutes.Thequalitativefindingssuggestedthattheadoptionoftechnologydrivensolutions,suchasreal-timetrackingandpredictiveanalytics,playeda crucial roleinallowingsupplychainresilience. Thesetechnologiesempowerfirmstopromptlydetectandreacttointerruptions.
Thequantitativeanalysisyieldedmoreprofoundinsightsintotheefficacyofthesetactics.Thestudyrevealedthatcompanies with more varied supply chains experienced less impact from the longer lead times (15-20%) if they kept larger levels of crucialmaterialinventoriescomparedtocompaniesthatstoredsimilarinventoriesinmorecentralizedlocations.Inthesame vein, companies who employed sophisticated technological solutions witnessed a roughly 30% swifter recovery to regular operations following a calamity. These findings offered concrete proof of the advantages of implementing a comprehensive resilienceplanthatintegratesconventionalriskmanagementmethodsandcutting-edgetechnologicaladvancements.
Thestudyalsoexaminedtheimpactofgovernmentalactionsonimprovingtheresilienceofsupplychains.Thequalitativedata unequivocally demonstrated that industry stakeholders typically expressed their appreciation for the prompt restoration of infrastructure and the financial support provided by governments in the aftermath of disasters. In addition, they held the beliefthat there shouldbea greateremphasisonimplementingwell-organizedand long-termstrategiesaimed atenhancing disasterpreparednessandstrengtheningtheresilienceofsupplychains.
The intricate level of information in the quantitative data strengthens the subtle and refined quality of the policy actions. According to the econometric models, implementing prompt policy measures such as post-disaster subsidies and tax reliefs resultedina15-20%enhancementinthespeedofrecoveryfortheindustriesthatwereimpacted.Nevertheless,theabsence of well-defined and comprehensive long-term strategies resulted in a gradual although limited enhancement in the overall robustnessofthesupplychain.Thishighlightsthesignificanceofadoptingapolicystrategythateffectivelymanagesboththe urgentrequirementsforrecoveryandthelong-termexpendituresaimedatenhancingresilience.
Discussions
The study's findings offer valuable insights into the intricate nature of disaster resilience in supply chains. A thorough approach to risk assessment and management is necessary due to the multiplying effect of natural disasters on supply networks.Theeffectivenessofresiliencesolutions,namelytheimpactoftechnologicalinnovationanddiversifiedsupplychain structures,highlightsthesignificanceofadaptiveandproactiveplanningandforesight.Thestudy'smostnotablefindingmay liein the ways governmental actionsfacilitateandstrengthensupplychain resilience.An importantlessonfromthestudy is the necessity of incorporating cutting-edge technologies into supply chain management. The strong connection between the useoftechnologyandthequickrecoveryafteradisasterindicatesthesignificantimpactthatdigitaltechnologiesmayhave on improving the ability of supply chains to withstand and recover from disruptions. However, this discovery also prompts inquiries regarding the accessibility and cost-effectiveness of these technologies, specifically for small and medium-sized businesses. Thestudyhighlights thatestablishing robustsupplynetworksisa collectiveobstacle,butitalsorevealspossible remedies. The advantages of sharing risks and pooling resources, as demonstrated by the reduced cost of recovery for a company within a collaborative network, indicate that establishing partnerships between companies, government agencies, andnon-governmentalorganizationscouldbeaneffectivesolutionforimprovingdisasterresilience.
This study is the first, as far as we know, to provide empirical evidence that investments in new technology can effectively enhance organizations' ability to respond to disruptions in the supply chain. Our research indicates that policymakers and organizations dedicated to addressing systemic poverty can reduce the effects of natural disasters by assisting companies in developing supply chains that are resistant to such disasters. Therefore, it is imperative for policy makers to prioritize a comprehensive strategy that encompasses several aspects. This includes directing resources towards disaster-resistant
International Research Journal of Engineering and Technology (IRJET) e-ISSN:2395-0056
Volume: 11 Issue: 02 | Feb 2024 www.irjet.net p-ISSN:2395-0072
companies by providing accessible loans (similar to the ones examined in our study), encouraging technological advancements, and facilitating collaborative efforts among companies to safeguard supply chains from natural disasters. Theseinitiativescanbefurtherenhancedbyastrongandwell-definedpolicyframework.
Thisstudyenhancesourcomprehensionofdisaster-resilientsupplychainsandoffersempiricalevidenceandvaluableinsights to businesses, policymakers, and other stakeholders who seek to establish resilient supply chains in the face of natural disasters. By doing so, these supply chains can contribute to the sustainable development of economies that are particularly susceptibletoextremeenvironmentalrisks,suchasmanydevelopingcountries.
Recommendations for Businesses:
New technologies such as real-time tracking, advanced analytics and automated inventory management systems can be a major part of how a company can add visibility and flexibility to its supply chain as part of a leading-edge disaster response organisation.Butinanenvironmentwherenaturaldisastersarebecomingmorefrequent,actionplanshavetobecreatedand revised often. A business continuity planning for disaster management is where all of these levers come together. So is the timetoexpandthesupplierbaseandinvestinstrategicreservesofkeycommodities.Divertingfromasole-sourceproviderfor themostessentialproductionmaterialsisaconservativeriskcheckandbalancestoguardagainstbeingcashpoorwhenever an unpredicted event occurs. It’s also the time to have a comprehensive plan for disaster preparedness and response. What stepsshouldyoutake?Whatshouldyouthrowoverboard?Whatcommunicationtacticsshouldbe streamlined?Whatarethe prioritiesinrecovery?
Policy makers are essential in directing the development and shape of catastrophe resilience. Policies can help create organizedandstablepolicyframeworksthatmakeitmoreattractiveforbusinessestoinvestindisasterresilience.Offeringtax incentivestoinvestindisasterresilience,providingsubsidiestoadoptdisasterresilienttechnologiesandreducinginsurance premiums and providing low-interest loans for businesses that invest in risk mitigation will drive business investment in disaster resilience. It’s also important to invest in resilient infrastructure and advanced technologies on a national scale to ensure the nation as a whole is resilient. Resilient infrastructure requires developing a robust transportation and communicationinfrastructure,whileadvancedtechnologiesrequireadvancementsinsupplychainmanagement,includingthe development and implementation of distributed ledger technology (DLT) to enhance supply chain transparency and auditability.
Finally, the development of cooperative ecosystems among business, government and non-governmental organizations (NGOs)isessential.Theseecosystemssharingtheriskandpoolingofscarceresourcesandexperientiallearningthatiscentral tobuildingamoreresilientsupplychainecosystem.Stakeholdersmustbededicatedtoongoingeducationandenhancement, keeping informed about the latest trends in and best practices for catastrophe resilience. Regular participation in webinars andknowledge exchangeplatforms,aswell asattendanceatconferencesand workshops,cansignificantlyfacilitatereaching this objective. In addition, catastrophe resilience techniques must be synchronized with broader goals of sustainability and social responsibility. Use of environmentally sustainable practices, ensuring fair labor practices, and actively working to support the socio-economic advancement of local communities should be key components of resilience plans. It is crucial to createmechanisms forthecontinuousevaluationandoversightofsupplychainrobustness.Thiswillinvolveputtinginplace keyperformanceindicators(KPIs)relatedtoriskexposure,timetorecovery,andcostefficiency,andusingthesemeasuresto drivedecision-makingandcontinuousimprovement,guaranteeingthatthesupplychainisalwaysresilientandagile,capable ofenduringwhatevermaycomeitsway.
References:
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[2] Ahmed, K., & Soomro, M. A. (2014). Impact of natural disasters on supply chains and their resilience strategies: A case studyofPakistan.NaturalHazards,71(1),201-213.
[3]Sheffi,Y.,&RiceJr,J.B.(2005).Asupplychainviewoftheresiliententerprise.MITSloanManagementReview,47(1), 4148.
International Research Journal of Engineering and Technology (IRJET) e-ISSN:2395-0056
Volume: 11 Issue: 02 | Feb 2024 www.irjet.net p-ISSN:2395-0072
[4] Faisal, M. N., Banwet, D. K., & Shankar, R. (2006). Supply chain risk mitigation: modeling the enablers. Business Process ManagementJournal,12(4),535-552.
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[12]Dubey,R.,Gunasekaran,A.,&Papadopoulos,T.(2019).Disastermanagement:Aresilience-basedapproachforacircular economy.AnnalsofOperationsResearch,283(1-2),15-40.