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Supply Chain Risk Essentials
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Flashcards
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10. Capacity Risk
Risk of having insufficient capacity to meet demand or excess capacity leading to inefficiencies. Countermeasures include flexible manufacturing systems, capacity planning, and demand management strategies.
14. Environmental Risk
Risk from environmental challenges such as climate change and resource scarcity. Countermeasures include sustainable resource management, eco-friendly practices, and risk transfer via insurance.
1. Demand Risk
Risk of unpredictable or misunderstood customer demand leading to increased cost or lost sales. Countermeasures include demand forecasting, safety stocks, and adaptive supply chain management strategies.
11. Intellectual Property Risk
Risk of losing proprietary information or infringement on intellectual property rights. Countermeasures include robust IP protection strategies, regular IP audits, and secure information systems.
8. Price Risk
Risk from fluctuation in raw material or component prices. Countermeasures include use of futures contracts, fixed pricing agreements, and adaptable product design.
7. Quality Risk
Risk of product defects or failures in quality control. Countermeasures include implementing stringent quality control procedures, supplier quality audits, and certifications.
2. Supply Risk
Risk of interruption in the flow of key inputs, often due to supplier issues. Countermeasures include supplier diversification, strategic stockpiling, and dual sourcing strategies.
3. Transportation Risk
Risk associated with moving goods which can lead to delays or damage. Countermeasures include route optimization, reliable transportation partners, and contingency planning.
17. Operational Risk
Risk from inadequate or failed internal processes, people, and systems. Countermeasures include process re-engineering, staff training and development, and investment in technology.
13. Project Risk
Risk associated with executing projects, often resulting in delays or cost overruns. Countermeasures include project management best practices, risk assessment procedures, and contingency planning.
4. Geographic Risk
Risk due to geopolitical or natural disaster events in certain regions affecting supply chain. Countermeasures include geographic diversification, political risk insurance, and resilient supply chain design.
15. Compliance Risk
Risk of non-compliance with laws, regulations, and standard procedures. Countermeasures include regular compliance training, compliance audits, and an effective compliance management system.
16. Strategic Risk
Risk arising from changes in business strategy or poor strategic decisions. Countermeasures include strategic planning frameworks, ongoing strategy reviews, and adaptive execution plans.
5. Legal and Regulatory Risk
Risk from changes in laws or regulations that affect supply chain activities. Countermeasures include compliance management systems, regular legal audits, and adaptive operational plans.
9. Currency Risk
Risk from volatility in foreign exchange rates affecting costs and profits. Countermeasures include currency hedging, natural hedging by matching currency for costs and revenue, and multi-currency bank accounts.
12. Reputational Risk
Risk of damage to brand image and customer trust due to various factors. Countermeasures include crisis management planning, proactive public relations, and ethical business practices.
6. Technological Risk
Risks related to technology failure or obsolescence. Countermeasures include investing in technology redundancy, regular technology updates, and cyber security measures.
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