Risk Management for Improving Supply Chain Performance of Sugarcane Agroindustry
Muhammad Asrol, Marimin Marimin, Machfud Machfud, Mohamad Yani, Eizo Taira
Abstract
The purposes of this paper are to evaluate sugarcane supply chain performance, identify supply chain risks, and define mitigation to improve the performance. Supply chains were modeled through a Supply Chain Operation Reference (SCOR) and Fuzzy-Analytic Hierarchy Process (AHP) to evaluate the performance. This paper modeled fuzzy-House of Risk (HOR) to identify and assess supply chain risk. Expert judgment for supply chain risk assessment was aggregated using an Ordered Weighted Average (OWA) model. The supply chain performance of farmers was found to be average, while that of sugar mill was at below average. Our model succeeded in identifying and assessing 15 risk agents for farmer, seven risk agents for sugar mills, and four risk agents for distributors which had to be mitigated. This work offers meaningful guidance for decision-makers to compose strategies to mitigate risk and enhance performance of sugarcane agroindustry supply chains.