Scope and definition of the assignment problem
Methodology
Introduction
Why are supply chains becaming vulnerabiles?
Definition of risk
Supply risk dimensions
Perception of supply risk
Supply chain risk management
8.1. How to avoid 6 management pitfalls
Conclusions
Bibliography
1. SCOPE AND DEFINITION OF THE ASSIGNMENT PROBLEM
The aim of this paper is to describe and analyse the supply risk management in the field of strategic purchasing.
Starting giving a definition of the concept of risk and describing the risk dimensions, I 'll talk about the perception of supply risk and I 'll finish my assignment describing how firms can manage the risk.
2. METHODOLOGY
Using the course literature, other secondary sources and contents of two courses of my master in Italy (Ratail&channel management and Trade marketing), I tried to give an overall view on risk management in strategic purchasing.
3. INTRODUCTION
Purchasing decisions involve high risks: so strategic purchasing in not just value optimization, but securing and defending the company against potential losses.
The global enviroment is putting under pressure the modern organizations and due to the increased competition, that is becaming stronger, the best solution for remain efficient is to take risks. In the past years, risk has been seen as negative for organizations; today the scenary is changing and risk is seen as an opportunity and a challange for apport innovations in companies. Procurement professionals are changing their mind, shinfting from a risk adverse approach to a modern approach, which means finding new solutions to monitor the risk process step by step, in a proactive and structured way.
4. WHY ARE SUPPLY CHAINS BECAMING VULNERABILES?
There are several factors that are making supply chains more vulnerabiles. These are the main motives:
Globalization of the supply chain
Outsourcing Phenomenon
Volatility of demand
Reduced supplier base
Bibliography: Rn = P(loss)n x I(loss)n Yates and Stone (1992) have completed the Mitchells definition, identifying the three main components of the risk construct: significance of those losses (loss importance for the company) Jacoby and Kaplan (1972) and Roselius (1971) identifies six different types of losses: Time loss Mitchell (1995) extended this division of losses, saying that there are two main forms of losses: Source: Adapted from Deleris and Erhun (2007) 7 Source: Zsidin (2003) He identifies three categories which affect risk perception: Source: Mitchell (1995)