Supply Chain Risk Management in India: An Empirical Study of Sourcing and Operations Disruptions, their Frequency, Severity, Mitigation Methods, and Expectations

Abstract

With an annual growth of almost 20% since the year 2000, Indian merchandise exports exceeded 300 billion U.S. dollars in 2012. The country is becoming a major supplier to the world. However, companies sourcing products and operating in India are experiencing a variety of supply chain disruptions that impede their operations and finances. The purpose of this dissertation is to investigate the frequency, impact and severity of supply chain risks experienced by companies in India, as well as assess the usefulness of mitigation methods and enquire about future expected disruptions. It is hoped that the results will prepare managers to better prioritize their supply chain risk management efforts and investments. The scope of this study is upstream (sourcing and operations) disruptions that affected Indian supply chains over the past three years, including the areas of logistics and transportation. The methodology is a quantitative, empirical study, using a survey instrument in the form of a questionnaire distributed electronically to thousands of members of four prominent trade associations in India.The platform for the questionnaire is a modification of a traditional risk analysis progression: mapping, identifying, assessing, mitigating and improving, also dubbed "MIAMI".The main findings are that there are major and significant differences in severity (frequency and impact) between the thirteen risk categories presented. There are also significant group differences among the respondents. Traditional mitigation methods differ with respect to usefulness, and expected risks are somewhat different than past ii risks. Conclusions reached are that chronic risks such as inadequate transportation, logistics and utilities infrastructure, supplier and labor problems, and bureaucracy/red tape are more severe than highly publicized and visible risks such as natural disasters, terrorism and crime. Traditional mitigation methods are useful for many of the disruptions, but ineffective for non-physical risks. There is a certain optimism with respect to future infrastructure related disruptions.Limitations of the study include a relatively low response rate, the classic difficulty in risk analysis of comparing and scaling the impact of disruptions, and that it is not fine grained enough to fully describe any specific industry sectors. This study contributes to the field of supply chain risk management by adding crucial empirical information from a heretofore unexplored market.iii DEDICATIONThe dissertation is dedicated to my faithful wife, Kari, who not only financed a great deal of my self-actualization project, but also suffered through more than five years of stress, distractions and excuses. Obtaining a doctorate at middle age is hard on the family.I cannot thank her enough. 1 According to Webster's Dictionary, both disturb and disrupt mean to "throw into disorder". This dissertation uses the term disruption most of the time, but occasionally the synonym disturbance is applied (Merriam-Webster, 1976). Disruption can b...

Barriers to Adoption of Supply Chain Management in India: A Theoretical Model and Scale Development

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“…Existing scales, where available, were selected, keeping in mind that they adequately covered the domain, were internally consistent and were parsimonious (Churchill, 1979). The items were also classified as existing, modified, derived, and newly proposed, similar to the classification done by Ungan, 2002. The scale items for "SCM attributes" have been adapted from the studies of Rogers, 2003;Tornatzky and Klein, 1982;Ramamurthy, 1990;Breckon, 2009. The scale items for "top management factors" have been adapted from the studies of Hambrick and Mason, 1984;Ramamurthy, 1990;Min and Mentzer, 2004;Cohen and Roussel, 2005;Min et al, 2007;Kotzab et al, 2011. The scale items for "organizational factors" have been adapted from the studies of Narver and Slater 1990; Ungan, 2002;Denison and Fey, 2003;Dehning et al, 2004;Braunscheidel, 2005;Cohen and Roussel, 2005;Netland et al, 2007;Dobni, 2008;Flatten et al, 2011;Prem, 2011. The scale items for "business environment factors" have been adapted from the studies of Ramamurthy, 1990;Teo et al, 2003;Udbye, 2014. Table 2 provides a summary of the source references of the survey for scale items used in this study.…”

“…Table 2 provides a summary of the source references of the survey for scale items used in this study. Ramamurthy, 1990;Ungan, 2002;Denison and Fey, 2003;Dobni, 2008;Flatten et al, 2011;Prem, 2011 Modified 30 Narver andSlater 1990;Ramamurthy, 1990;Denison and Fey, 2003;Teo et al, 2003;Min and Mentzer, 2004;Braunscheidel, 2005;Netland et al, 2007;Dobni, 2008;Flatten et al, 2011;Udbye, 2014Derived 23 Rogers, 2003Tornatzky and Klein, 1982;Hambrick and Mason, 1984;Ramamurthy, 1990;Teo et al, 2003;Dehning et al, 2004;Cohen and Roussel, 2005;Min et al, 2007;Netland et al, 2007;Breckon, 2009; Kotzab et al, 2011 Newly Proposed 29 Total 94…”

A novel classification of supply chain risks: Scale development and validation

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The thematic landscape of literature on supply chain management in India: a systematic literature review

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