Risk control for staff planning in e-commerce warehouses

Internet sale supply chains often need to fulfil quickly small orders for many customers. The resulting high demand and planning uncertainties pose new challenges for e-commerce warehouse operations. Here, we develop a decision support tool to assist managers in selecting appropriate risk policies and making staff planning decisions in uncertain conditions. Multistage stochastic modelling has been used to analyse risk optimisation approaches and expected value-based optimisation. Exhaustive numerical and practical validations have been performed to test the tool's applicability. We demonstrate, using a Dutch e-commerce warehouse, that the multi-period conditional value at risk appears to be most applicable.