INPROFORUM 2017

Financial Health as a Key Factor for Improving the Stability of Supply Network
Jaroslava Pražáková, Martin Pech

Language: en
Last modified: 2018-04-10

Abstract


The relationships with companies in supply network provide the opportunity for the company to influence others. The network stability depends on many factors including financial health of each company. Relationships are also a force for these others to influence the company financial health and can bring financial threats. The main aim of the paper is to evaluate core part of network based on financial health of companies linked by their mutual relationships.The paper applies the TOPSIS method to company relationships description (strength and difference of relationships weighting). With respect to standard ratio financial analysis (liquidity ratios, asset management, debt management and profitability) on nodes, TOPSIS weightings on company links are developed. TOPSIS method should enhance the typical network characteristics for things like centrality, betweenness, and others. Results show the important role of companies creating the core of network for improving supply network stability.

Keywords


financial health; network stability; TOPSIS; sensitivity analysis

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