Vulnerability of Supply Chains

Asbjemslett, Bjorn Egil. 2008. Assessing the Vulnerability of Supply Chains. In Supply Chain Risk — A handbook of Assessment, Management, and Performance, eds. G. A. Zsidisin and Bob Ritchie Springer Science-I-Business Media, LLC. 

The most common classification of risk sources for a supply chain is a division into internal and external sources. The Research at Cranfield School of Management sponsored by the British Department of Transport has shown that the most important factors affecting the vulnerability of supply chains are (Braithwaite 2003, pp. 6-7) ... 

At the same time the vulnerability of supply chains to disturbance or disruption has increased. It is not only the effect of external events such as natural disasters, strikes or terrorist attacks but also the impact of changes in business strategy. Many companies have experienced a change in their supply chain risk profile as a result of changes in their business models. For example, the adoption of lean practices, the move to outsourcing and a general tendency to reduce the size of the supplier base potentially increase supply chain vulnerability. 

Risks and vulnerabilities in supply chains are widely acknowledged as a challenge for corporations, see e.g. Manuj Mentzer (2008), Paulsson (2004) andVanany etal. (2009). However, while there are a niunber of proposed conceptual frameworks, few seem to give clear answers to performing supply chain risk management. 

Svensson, G. 2000. A conceptual framework for the analysis of vulnerability in supply chains. International Journal of... 

This chapter presents important problems in supply chain risk management that extend beyond the traditional treatment of supply chain management commonly found in textbooks. We discuss in detail the vulnerability, driven by globalization, of supply chains around the world to a disruptive event in one part of a single country. This chapter presents models and methods to answer the following queshons ... 

Ritchie B., Brindley C., 2009, Effective Management of Supply Chains Risks and Performance, in T. Wu, J. Blackhurst (eds). Managing Supply Chain Risk and Vulnerability, Tools and Methods for Supply Chain Decision Makers, London Springer. 

Svensson G., 2000, A Conceptual Framework for the Analysis of Vulnerability in Supply Chains, International Journal of Physical Distribution Logistics Management, 30(9), pp. 731-749. 

Stecke, Kathryn E., and Sanjay Kumar. Sources of Supply Chain Disruptions, Factors that Breed Vulnerability, and Mitigating Strategies. Journal of Marketing Channels 16, no. 3 (2009) 193-226. 

Dr. Bjorn Asbjornslett tackles the issues associated with analyzing the potential vulnerabihty of supply chains, enabling a more proactive approach to SCRM. Having introduced the concepts of vulnerability and resilience in the context of the supply chain, the author examines the contributory factors influencing both vulnerabihty and resilience. The chapter concludes with the exposition of a detailed approach to assessing the vulnerability of the supply ch providing practical iUustrations, guidance and advice on associated tools that may be employed to support the analysis and assessment. 

Many supply chains are particularly vtrlnerable because management is not fully aware of the threats that the system is exposed to and the vulnerable situation these threats impose on the supply chain. This chapter has outlined an approach to stmcture, imderstand arrd analyse vulnerability in supply chains. The approach could be a part of SCM, especially to test changes in vulnerability after clmges in the supply chain network. The approach is based on seven steps, with three main issues ... 

We believe that through this approach, vulnerability and resilience management may become a practical part of SCM, establishing a formal and conscious process of understanding, analysing and handling risks and vulnerabilities in supply chains. 

Peck, H. (2005). Drivers of supply chain vulnerability An integrated framework. International Journal of Physical Distribution and Logistics Management, 35(3/4), 210-232. 

Firstly, the supply chain to be analysed has to be defined. In the methodology, the SME can select a supply chain for the subsequent detailed risk analysis by positioning either all or an intuitive short hst of supply chains in a portfoho with two dimensions strategic importance and vulnerability (see Fig. 13.5). 

While a supply chain disraption is the trigger that leads to the occurrence of risk, it is not the sole determinant of the final loss. It seems consequential that also the susceptibility of the supply chain to the harm of this situation is of significant relevance. This leads to the concept of supply chain vulnerability. The basic premise is that supply chain characteristics are antecedents of supply chain vulnerability and impact both the probability of occurrence as well as the severity of supply chain dismptions. 

The firm s benevolence-based trust towards the powerful partner facilitates the information power s effect on the firm s predisposition to share information and know-how. When the partner is providing information regarding the benefits of supply chain collaboration, the firm is vulnerable to the benevolence of the partner (Lee, 1997). With high level of benevolence-based trust, the firm is more likely to perceive that the partner is promoting joint interests constructively by providing this information (Dwyer et al., 1987). Thus, it takes more face value of this information and is more willing to be influenced by this partner. 

Even on the basis of these very rough distinctions, the possibilities for action and restrictions on action for companies can be better comprehended in the case studies, by looking at the markets in which they are active. These competitive conditions constitute a broad scope for impact and vulnerabilities for companies or supply chains with regard to external factors that are closely related to effects arising from their position within the supply chain. 

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