Annals of Operations Research

, Volume 257, Issue 1–2, pp 15–44 | Cite as

Robust supply chain network design: an optimization model with real world application

  • Shiva Zokaee
  • Armin Jabbarzadeh
  • Behnam Fahimnia
  • Seyed Jafar Sadjadi


This paper presents a robust optimization model for the design of a supply chain facing uncertainty in demand, supply capacity and major cost data including transportation and shortage cost parameters. We first present a base model that aims to determine the strategic ‘location’ and tactical ‘allocation’ decisions for a deterministic four-tier supply chain. The model is then extended to incorporate uncertainty in key input parameters using a robust optimization approach that can overcome the limitations of scenario-based solution methods in a tractable way, i.e. without excessive changes in complexity of the underlying base deterministic model. The application of the approach is investigated in an actual case study where real data is utilized to design a bread supply chain network. Numerical results obtained from model implementation and sensitivity analysis experiments arrive at important managerial insights and practical implications.


Supply chain design Location Allocation Uncertainty Robust optimization Case study 


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Copyright information

© Springer Science+Business Media New York 2014

Authors and Affiliations

  • Shiva Zokaee
    • 1
  • Armin Jabbarzadeh
    • 1
  • Behnam Fahimnia
    • 2
  • Seyed Jafar Sadjadi
    • 1
  1. 1.Department of Industrial EngineeringIran University of Science and TechnologyTehranIran
  2. 2.Institute of Transport and Logistics Studies (ITLS)The University of Sydney Business SchoolSydneyAustralia

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