Global supply chains are increasingly under pressure. Natural disasters, political instability, and particularly the Covid-19 pandemic have revealed major vulnerabilities—especially in procurement. This paper explores the concept of Supply Chain Risk Management (SCRM) with a specific focus on procurement-related risks.
It begins by defining key terms and illustrating them with practical examples. The paper then examines the core risk management process, including risk identification, assessment, controlling, and monitoring. Analytical tools such as SWOT analysis and utility analysis are discussed as methods to support supplier-related decision-making. A case study of the company AGCO highlights how modern technologies and alternative sourcing strategies can enhance supply chain resilience.
The aim of this paper is to present practical approaches that enable companies to secure their procurement processes and build more crisis-resistant supply chains.
Table of Contents
- 1. Introduction
- 1.1. Brief overview
- 1.2. Structure of the essay
- 2. Fundamentals of supply chain management (SCM) and supply chain risk management (SCRM)
- 2.1. Supply chain management (SCM)
- 2.2. Supply chain risk management (SCRM)
- 2.2.1. Risk Types and Categories
- 2.2.2. The Covid-19 pandemic and procurement risks
- 3. Risk management process and its steps
- 3.1. Risk identification
- 3.2. Risk assessment
- 3.3. Risk controlling
- 3.4. Risk monitoring
- 4. Supplier Relationship Management and practical approaches to manage risks
- 4.1. Utility analysis regarding suppliers
- 4.2. Procurement Balanced Scorecard
- 4.3. Supply chain transparency and alternative sourcing strategies
- 4.4. A practical example - the company AGCO during the Covid-19 pandemic
Objectives and Key Themes
This essay aims to explore how companies can mitigate risks, particularly procurement risks, within their supply chains to enhance resilience and responsiveness to current and future crises. It analyzes the impact of events like the COVID-19 pandemic on global supply chains and examines practical approaches to supply chain risk management (SCRM). * The impact of globalization and digitalization on supply chains. * The role of supply chain management (SCM) in mitigating risks. * Effective risk management processes and their implementation. * The importance of supplier relationship management in risk mitigation. * Practical approaches to managing supply chain risks.Chapter Summaries
1. Introduction: This introductory chapter sets the stage by highlighting the significant impact of globalization and digitalization on global supply chains. It emphasizes the challenges posed by recent events, such as the COVID-19 pandemic and the war in Ukraine, which underscored the critical need for robust supply chain risk management. The chapter lays the groundwork for the essay by outlining the importance of understanding and implementing effective risk management strategies to build more resilient supply chains capable of withstanding future disruptions. The introduction also provides a brief overview of the essay's structure. 2. Fundamentals of supply chain management (SCM) and supply chain risk management (SCRM): This chapter defines the core concepts of supply chain management (SCM) and supply chain risk management (SCRM). It traces the evolution of SCM from its origins in the early 1980s, emphasizing the shift towards a more holistic view of logistical activities. The chapter also defines a supply chain as a network encompassing all entities involved in creating and delivering products or services to the end customer, including the flow of materials, finances, and information. It highlights the complexities of managing these diverse flows while optimizing costs and quality, ultimately positioning SCRM as a crucial element within the broader context of effective SCM. 3. Risk management process and its steps: This chapter details the systematic steps involved in a comprehensive risk management process. It breaks down the process into distinct phases, starting with risk identification, where potential vulnerabilities within the supply chain are pinpointed. The subsequent risk assessment phase involves evaluating the likelihood and impact of identified risks. The chapter then outlines risk controlling mechanisms, detailing strategies to mitigate or eliminate identified risks. Finally, it discusses risk monitoring, emphasizing the importance of continuous surveillance and adjustment to ensure the effectiveness of implemented risk management strategies. 4. Supplier Relationship Management and practical approaches to manage risks: This chapter delves into practical approaches for managing supply chain risks, focusing heavily on supplier relationship management. It explores tools and techniques such as utility analysis to evaluate supplier performance and identify potential vulnerabilities. The chapter also introduces the procurement balanced scorecard as a framework for comprehensive risk assessment and management. Furthermore, it discusses the benefits of supply chain transparency and alternative sourcing strategies in mitigating risk exposure. A practical example, focusing on the AGCO company's response during the COVID-19 pandemic, is provided to illustrate the application of these strategies in real-world scenarios.Keywords
Supply chain risk management, supply chain management, procurement risks, risk mitigation, resilience, COVID-19 pandemic, globalization, digitalization, supplier relationship management, utility analysis, balanced scorecard, alternative sourcing, risk identification, risk assessment, risk control, risk monitoring.
Frequently asked questions
What is the purpose of this document?
This document provides a comprehensive language preview, including the title, table of contents, objectives and key themes, chapter summaries, and keywords, designed for academic use to analyze themes related to supply chain risk management in a structured and professional manner.
What are the main topics covered in this document?
The main topics covered include supply chain management (SCM), supply chain risk management (SCRM), the risk management process, and supplier relationship management, along with practical approaches to managing risks, particularly in the context of events like the COVID-19 pandemic.
What are the key themes discussed in the essay?
The key themes are: the impact of globalization and digitalization on supply chains, the role of SCM in mitigating risks, effective risk management processes, the importance of supplier relationship management, and practical approaches to managing supply chain risks.
What are the steps in the risk management process, as described in this document?
The risk management process includes: risk identification (pinpointing potential vulnerabilities), risk assessment (evaluating the likelihood and impact of risks), risk controlling (implementing strategies to mitigate risks), and risk monitoring (continuous surveillance and adjustment).
How does this document address supplier relationship management?
The document discusses supplier relationship management as a crucial aspect of managing supply chain risks. It explores tools and techniques such as utility analysis and the procurement balanced scorecard to evaluate supplier performance and identify vulnerabilities. It also highlights the benefits of supply chain transparency and alternative sourcing strategies.
What is the significance of the COVID-19 pandemic in the context of this document?
The COVID-19 pandemic is highlighted as a recent event that underscored the critical need for robust supply chain risk management, exposing vulnerabilities and disruptions in global supply chains. A practical example focusing on the AGCO company's response during the pandemic is provided.
What keywords are associated with this document?
Keywords include: Supply chain risk management, supply chain management, procurement risks, risk mitigation, resilience, COVID-19 pandemic, globalization, digitalization, supplier relationship management, utility analysis, balanced scorecard, alternative sourcing, risk identification, risk assessment, risk control, and risk monitoring.
What is the overall objective of the essay this document previews?
The essay aims to explore how companies can mitigate risks, particularly procurement risks, within their supply chains to enhance resilience and responsiveness to current and future crises.
What is the role of digitalization discussed in the essay?
The essay considers the impact of digitalization on global supply chains, highlighting its role in both creating new risks and providing opportunities for improved risk management through enhanced transparency and real-time data.
- Arbeit zitieren
- Ali Assadi (Autor:in), 2023, Supply Chain Risk Management, München, GRIN Verlag, https://www.grin.com/document/1576909
