Tag Archive | Supply Chain Risk Management

Balancing Efficiency and Resilience in Multimodal Supply Chains

In his new report, titled Balancing Efficiency and Resilience in Multimodal Supply Chains, McKinnon (2018) writes: “Over the past twenty years, supply chain resilience has become a hot topic in industrial, government and academic circles – for good reason. Business surveys and a mass of anecdotal evidence have revealed that supply chains have become more vulnerable to disruptions and the consequences of these disruptions become more severe. […] Despite this attention and research efforts, many companies are still at an early stage in the development and implementation of supply chain risk management strategies.” The author examines “how efficiency and resilience can be balanced in the management of multi-modal supply chains”. The author further “investigates the trade-off between supply chain resilience and efficiency, the approaches to sustainability in supply chain management, innovation and technological development, collaboration and alliances and risk mitigation”. The report summarizes findings from a Roundtable of the International Transport Forum held in April 2018. A call for papers deals with supply chain resilience.

McKinnon, A. (2018). Balancing Efficiency and Resilience in Multimodal Supply Chains. International Transport Forum Discussion Papers, OECD Publishing, Paris.

The Missing Link? EU Supply Chains after Brexit

The United Kingdom has been one of the key links in EU supply chains for more than 40 years. BBC Newsnight has recently reported on how Brexit could break that chain and what the consequences could be for manufacturers. I like the video and have used it for my Supply Chain Risk Management course to discuss this topic with my students.

Performance Measurement Systems in the Era of Turbulence

Our new article, titled Accounting for External Turbulence of Logistics Organizations via Performance Measurement Systems (Supply Chain Management: An International Journal, Vol. 21, No. 6), is out now. It deals with the interface of supply chain risk management – a “hot topic” in SCM research – and performance measurement systems (PMS). The article was co-authored by Andreas Bühler, Carl Marcus Wallenburg and me. We address two research objectives: First, we focus on the outcome of PMS design for turbulence: We argue “that accounting for external turbulence via metrics in PMS design is beneficial for logistics organizations and show to what extent it increases organizational resilience and the [performance] of the companies”. Second, we focuses on the antecedents of PMS design for turbulence: We demonstrate “that the approach which the upper management of an organization has toward how to use the PMS in general will strongly impact the extent to which an organization incorporates risk metrics into its PMS”.

Bühler, A., Wallenburg, C.M., & Wieland, A. (2016). Accounting for External Turbulence of Logistics Organizations via Performance Measurement Systems. Supply Chain Management: An International Journal, 21 (6), 694-708 DOI: 10.1108/SCM-02-2016-0040

If you do not have access to the article, the accepted author manuscript can be downloaded for free at Copenhagen Business School’s Research@CBS platform (click on the document in the green box there).

The State of Sustainable Supply Chains

Supply chain management can play a key role to help creating a more sustainable world that leaves no one behind. A new report, The State of Sustainable Supply Chains (pdf), echoes the voices of more than 100 specialists from 70 companies to reveal how companies “are embedding sustainability in their supply chains by managing risks and adopting corporate commitment to human rights, ethics, the environment and the communities from which they source goods and services”. The report was produced by Ernst & Young in association with the United Nations Global Compact. The authors present six main study findings: (1) “Supply chain sustainability can no longer be ignored”; (2) “companies are predominantly risk-driven with aspirations to unlock strategic opportunities and benefits”; (3) “companies tailor their approaches and governance to create sustainable supply chains”; (4) “leading companies are establishing a shared commitment with suppliers”; (5) “technology enables visibility and influence beyond tier 1”; and (6) “collaboration is critical for companies to achieve greater impacts”.

Future Research Themes in Supply Chain Management

What are the future dominant research themes in supply chain management? In my new article, Mapping the Landscape of Future Research Themes in Supply Chain Management, co-authored with Robert Handfield and Christian Durach and published in the Journal of Business Logistics, we make an attempt to answer this important question. Our research is based on survey data collected from 141 SCM scholars. Big data ranks 1st on the list of topics that scholars expect will become important in the next years. Interestingly, this topic does not even appear in the top 10 of the list of topics that scholars think should become important. This list is led by sustainability and risk management instead. We calculated the differences between the will-become-important and should-become-important topics. The largest discrepancies can be found for: (1) the “people dimension” of SCM, (2) ethical issues, (3) internal integration, (4) transparency/visibility, and (5) human capital/talent management. These five under-represented topics could thus be good choices for future research projects or special journal issues.

Wieland, A., Handfield, R., & Durach, C. (2016). Mapping the Landscape of Future Research Themes in Supply Chain Management. Journal of Business Logistics, 37 (3), 1-8 https://doi.org/10.1111/jbl.12131

If you don’t have access to the journal, please feel free to request a copy of the paper via ResearchGate (blue button on their page).

Citations of Excellence Awards 2016

Each year, Emerald awards certificates to highly cited papers, hereby also taking into account the content of the papers (see my previous post). I identified five Citations of Excellence winners related to SCM this year: (1) Technology Designed to Combat Fakes in the Global Supply Chain by Li; (2) The Reduction of Greenhouse Gas Emissions from Freight Transport by Pooling Supply Chains by Pan, Ballot & Fontane; (3) Ensuring Supply Chain Resilience: Development and Implementation of an Assessment Tool by Pettit, Croxton & Fiksel; (4) Closed-Loop Supply Chains: A Critical Review, and Future Research by Souza; and (5) Data Science, Predictive Analytics, and Big Data: A Revolution that Will Transform Supply Chain Design and Management by Waller & Fawcett. All of these articles were selected from articles published in 2013. It can again be observed that articles dealing with sustainability or resilience seem to have a good chance to become highly cited, but also articles about innovative technologies turn out to be quite popular.

Li, L. (2013). Technology Designed to Combat Fakes in the Global Supply Chain. Business Horizons, 56 (2), 167-177 https://doi.org/10.1016/j.bushor.2012.11.010

Pan, S., Ballot, E., & Fontane, F. (2013). The Reduction of Greenhouse Gas Emissions from Freight Transport by Pooling Supply Chains. International Journal of Production Economics, 143 (1), 86-94 https://doi.org/10.1016/j.ijpe.2010.10.023

Pettit, T., Croxton, K., & Fiksel, J. (2013). Ensuring Supply Chain Resilience: Development and Implementation of an Assessment Tool. Journal of Business Logistics, 34 (1), 46-76 https://doi.org/10.1111/jbl.12009

Souza, G. (2013). Closed-Loop Supply Chains: A Critical Review, and Future Research. Decision Sciences, 44 (1), 7-38 https://doi.org/10.1111/j.1540-5915.2012.00394.x

Waller, M., & Fawcett, S. (2013). Data Science, Predictive Analytics, and Big Data: A Revolution That Will Transform Supply Chain Design and Management. Journal of Business Logistics, 34 (2), 77-84 https://doi.org/10.1111/jbl.12010

How We Should Tackle Risk in Global Supply Chains

Managing risks in a global supply chain can be a difficult task, as I argue in my new essay, titled Managing the Unknown: How We Should Tackle Risk in Global Supply Chains. Most importantly, there are substantial differences between two systems: “the company” and “the supply chain”. In a company it might be relatively easy to get an overview about all the risks that might occur. But a supply chain consists of hundreds, sometimes thousands of companies. Consider all the suppliers, suppliers’ suppliers etc. in an automotive supply chain. Approaches to manage risks that occur in a company are, therefore, not necessarily scalable to manage all the risks that occur in a system as complex and dynamic as a supply chain. As I also argue, we need to increase the robustness of a supply chain instead. Based on the results of our research, my essay presents both intra-organizational and inter-organizational factors that can help companies to increase the robustness of their supply chains.

Supply Chain Integrity: Protecting Our Blind Spots

Research on supply chain risk and resilience has focused a lot on accidental disruptions, caused for example by an earthquake or the fire at a supplier’s plant. A sometimes overlooked element of supply chain risk management are disruptions that are caused by malicious intent, for example fraud. Indeed, due to their complexity, modern supply chain systems have become vulnerable to deliberate harm. A recently published report by Zurich Insurance Group and SICPA, titled Supply Chain Integrity: Protecting Companies’ Blind Spots, is focused on such types of risk. The authors argue that “companies can increase their ability to safeguard against deliberate supply-chain ‘infiltration,’ such as that caused by counterfeit or tampered products”. In their study, they “offer numerous recommendations and examples gathered in interviews with government and industry experts, enforcement specialists, risk managers and executives at large corporations”. I believe this report makes an important contribution to widen our understanding of supply chain risk and resilience.

A Theory of Robust Supply Chains

Strategies and practices to achieve supply chain resilience have been at the heart of supply chain management practice and research for almost a decade. However, such efforts have often focused on ways to make supply chains more reactive to turbulence and disruptions. In our recent article, Antecedents and Dimensions of Supply Chain Robustness, my co-authors, Christian F. Durach and José A.D. Machuca, and me build a theoretical framework that depicts antecedents and dimensions of a second, rather proactive construct: supply chain robustness. We define supply chain robustness as the ability of a supply chain to resist or avoid change. Some of my previous research has shown that this construct is even more positively related with business performance than supply chain agility. Through reviewing 94 articles, and a Q-sorting exercise, we identify four (i.e. leadership commitment, human capital, relationship magnitude, and risk management orientation) important intra-organizational robustness antecedents and four (i.e. node centrality, bargaining power, visibility, and network complexity) inter-organizational robustness antecedents.

Durach, C., Wieland, A., & Machuca, J. (2015). Antecedents and Dimensions of Supply Chain Robustness: A Systematic Literature Review. International Journal of Physical Distribution & Logistics Management, 45 (1/2), 118-137 https://doi.org/10.1108/IJPDLM-05-2013-0133

More Complexity = More Disruptions?

Trends in management towards a concentration on core competencies and outsourcing of non-core activities have created complex networks, i.e., global supply chains. At the same time, it has been discussed that this increased complexity has also made companies more vulnerable. An interesting paper, Structural Drivers of Upstream Supply Chain Complexity and the Frequency of Supply Chain Disruptions, co-authored by Bode and Wagner, is currently forthcoming in the Journal of Operations Management. Herein, the authors distinguish between three drivers of upstream supply chain complexity: (1) horizontal complexity (= the number of direct suppliers in a firm’s supply base), (2) vertical complexity (= the number of tiers in the supply chain), and (3) spatial complexity (= the geographical spread of the supply base). Based on survey data, the authors find that all of these three drivers increase the frequency of supply chain disruptions. It is further found that these three variables even amplify each other’s effects in a synergistic fashion.

Bode, C., & Wagner, S. (2015). Structural Drivers of Upstream Supply Chain Complexity and the Frequency of Supply Chain Disruptions. Journal of Operations Management, 36, 215–228 https://doi.org/10.1016/j.jom.2014.12.004