Custom Research Paper
Supply Risk Management
It is normal for companies while dealing with services and goods to have to face some kinds of risks. These risks are commonly known as Supply Chain Risks. One particular kind of these risks is related to the purchasing of inbound supply, which are unexpectedly termed as Inbound Supply Risks. In the following are discussed some techniques for Inbound Supply Risk Management.
Inbound Supply Chain Risks
Inbound Supply Chain Risks can be defined as the possible happenings related to inbound supply because of the failures of some individual(s), or the market in which the consequences of these failures end up rendering the buying company unable to meet customer demand or resulting in risk and danger to customer health or safety, or both. Two very important facets of inbound supply risk management are the impact of these risks and the probability of them happening. While a lot of research has been carried out on Outbound Supply Risks, no way near enough has been done for the inbound side of things.
There are three important components of supply chain risks: the probability of them happening, the consequences of some risk event, and the path that leads to that particular event. Proper risk management attempts to cater to all of these components of the risk in question by using analyses of sources, understanding of the forces that drive such events into happening and also of how to manage them so as to enhance the probability of desirable results while reducing that of the possible negative ones. A nice technique in this regard is to use proactive methods that serve to prevent risk events from taking place in the first place. In a similar way to supply chain risks, supply chain-related decisions are also divided into three sub-categories: operational, tactical, and strategic. All of these categories usually work their best with the help of category-specific risk management responses.
Risk assessment can be done with many different approaches. One such approach is the use of a tool that was developed by Microsoft with Arthur Anderson, known as the Comprehensive Outsource Risk Evaluation (CORE) system. This process highlights nineteen risk factors and divides them into these four families: business controls, infrastructure, relationships, and business value.