Design and development of an agent-based model for business operations faced with flood disruption

Abstract

Small and medium enterprises (SMEs) constitute a major component of the United Kingdom’s economy, accounting for 99.9% of all private sector businesses and approximately 47% of annual turnover in 2014 [1]. However, these companies can suffer significant financial losses as a consequence of a disruption to business operations, such as a flood event, due to their limited resources and lack of organizational plans. Agent-based modelling is recognized as one approach to enable complex problems in business and social science to be studied. SMEs’ preparedness and response to disruptive events can be complex and interactive processes. Hence, agent-based modelling is an appropriate approach to study these processes and identify any emerging phenomena. With the aim of providing guidance for SMEs regarding how to better prepare and respond to the challenges faced when flooding occurs in the future, an agent-based model (ABM) is currently being designed and developed to represent and simulate SMEs’ existing and potential behaviours immediately prior to, during and in the short-term aftermath of a flood event. This paper describes preliminary work on the ABM’s develop- ment undertaken including the design of the various agents represented, the rules governing agent behaviours, the attributes of agents and the environment in which they operate. The basis of the ABM design draws on a range of sources including semi-structured interviews with SMEs which have experience of significant flood- ing, guidelines from the Environment Agency and local councils, business continuity management systems’ requirements (ISO223301) and academic literature. Further, the paper discusses performance metrics of SMEs which are adopted to assess the level of continuity of business operations in the model.