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A Fuzzy Risk Assessment Model for Warehouse Operations
Alp Ustundag

With the increasingly competitive nature of industry today it is very critical for organizations that supply chains continue to work as planned, with smooth and uninterrupted flows of materials from initial suppliers through to final customers. For an efficient supply chain management, risks should be identified, analyzed and managed accurately throughout the whole supply chain. Particularly, warehouse processes in supply chain operations contain risks to consider which lead to a poor supply chain performance. Therefore, risk assessment has been an important task for warehouse management. Failure mode and effect analysis (FMEA) is a suitable method for identifying all failure modes within a system, assessing their impact, and planning for corrective action. The traditional FMEA determines the risk priorities of failure modes, which require the risk factors like the occurrence (O), severity (S) and detection (D) of each failure mode to be evaluated. However, it has some drawbacks so that affect the risk evaluation and correction action. It is very difficult for three risk factors to be evaluated precisely. Additionally, traditional FMEA doesn’t consider the relative importance of three risk factors. In this paper, a risk assessment model using fuzzy FMEA method is proposed to evaluate the risks of warehouse operations. The rating of three factors is expressed as triangular fuzzy number and the relative importance among O, S and D is also considered as triangular number with respect to the judgments of experts. For defuzzification, α-cut and satisfactory index β are used in the model. The proposed model is applied to determine the most critical failure modes for warehouse operations of a food retail distributor in Turkey.

Keywords: Warehouse management, risk assessment, fuzzy FMEA, risk priority

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