Formation of Failure Models for the Evaluation of the Reliability of Supply Chains

Logistics and supply chain management is a comparatively new scientific field which has been rapidly developing.

Apart from the criterion of total logistics costs, that is used to evaluate the efficiency of supply chains, another criterion - total satisfaction of consumer needs - is being increasingly used for the same purpose. It can be explained by the transition to such new logistics concept as the sustainability of supply chains, which is characterized not only by flexibility, rate of response, strength, adaptability, but mostly by the reliability of functioning of the logistics system's elements.

The paper presents critical analysis of the existing approaches to the formation of failure models in supply chains, the methodical approach and classification of failures for the key logistics functions (purchasing, order processing, transportation, storage, warehousing and materials handling) as well as some developed and improved failure models for a number of logistics functions and operations; there have been also given some examples of calculating the reliability indices for the elements of the supply chain.