Supply Chain Risk Management Approaches Under Different Conditions of Risk

Abstract

A recent Deloitte study of 600 Supply Chain and C‐Level executives revealed that 45% felt that their supply chain risk management programs were only somewhat effective or not effective at all, while a mere 33% used risk management approaches to proactively and strategically manage supply chain risk based on conditions in their operating environment. Using a two‐method approach, the research summarized in this paper investigates the effectiveness of different supply chain risk management approaches by examining how performance varies when these approaches are applied under different risk conditions. The results counter prevailing knowledge regarding the appropriate use of such widely acknowledged risk management approaches as postponement and speculation, and highlight the dangers of functionally isolated decision making. The results lend credence to increasing calls for interdisciplinary research to address broad‐based supply and demand chain problems, and support the need to utilize performance metrics such as net profit to accurately assess supply chain decisions.

Exploring impact factors of shippers’ risk prevention activities: A European survey in transportation

“…They also aim at the mitigation and minimisation of risks and damage. Manuj et al (2014) point out the importance of adapting corporate risk management activities with regard to the specific risk conditions and to increase their effectiveness. Within corporate risk management structures, companies predict the probability of occurrence and the extent of a risk within a continuous monitoring (Dash Wu et al, 2010).…”

“…As a result, several different definitions are available in literature and associated with several classifications and frameworks of SC risks as well as with measures and models are presented (see for example Esmaeilikia et al, 2014;Heckmann et al, 2015;Jüttner et al, 2003;Peck, 2006;Tang, 2006. Risk itself is an elusive construct that has a variety of different meanings, measurements and interpretations depending on the academic research field. In this research a hazard-focused interpretation common in risk management is used which presents risk in the following understanding: risk equals the probability (of a given event) multiplied with its severity (negative financial business impact) (March and Shapira, 1987).…”

To be or not to be (loyal): Is there a recipe for customer loyalty in the B2B context?

“…In addition, the link between customer satisfaction and loyalty is highly variable depending on the industry, the nature of the variables, and the presence of several factors (Kumar, Dalla Pozza, & Ganesh, 2013). The supply chain management literature has also provided evidence that in a B2B context, service attributes such as having a robust product returns management process can play an important role in predicting customer loyalty (Manuj, Esper, & Stank, 2014;Mollenkopf, Rabinovich, Laseter, & Boyer, 2007).…”

Detecting disturbances in supply chains: the case of capacity constraints

“…Described as unplanned and unanticipated events that disrupt the normal flow of goods and materials in a supply chain and expose associated firms to operational and financial risks (Craighead et al, 2007), disturbances could be catastrophic such as earthquakes, fires, hurricanes and terrorist attacks, or recurring, such as delays in material deliveries, process losses and inappropriate information processing (Chopra and Sodhi, 2004). Together with risks which can be characterized as potential occurrence of disturbances, disturbances in supply chains have been a subject of intense research in recent times (Juttner, 2005;Wagner and Bode, 2008;Thun and Hoenig, 2011;Manuj et al, 2014). The important area of disturbance detection however, appears to have been overlooked.…”