Impact-oriented risk management: guiding practitioners towards a resilient supply chain design

Abstract

ABSTRACT In times of crisis, resilience has become a popular buzzword in supply chain management as a counterpart to efficiency and lean management. But how can supply chain resilience be addressed by companies and how can a process for assessing it be designed and established? The aim of this paper is to highlight the issue from both a practical and a scientific perspective, and to point the way forward for practical research. We present the strategic concept of an impact-oriented approach that, in contrast to standard risk management, proposes to first analyze the material flows of a supply chain to uncover its vulnerable elements before identifying specific risk events. The approach is flanked by three Practitioner Principles for resource-efficient application: i) use existing data in a reduced and structured manner, ii) examine Key Resilience Areas to assess vulnerabilities, and iii) consider the resilience appetite of supply chain managers.