Risk Mitigation Strategies on Supply Chain PT. X

Abstract

Every supply chain activity in a company is not separated from risk, therefore risk management in a company is strongly required for risk handling. PT. X is a manufacturing company that produces food flavors. Dependence with suppliers and consumers causes uncertainty in the company’s supply chain flow. This uncertainty can lead to adverse effects called risk. Risk can be minimized by carrying out risk management. This study aimed to design a risk management by identifying risk events from the company’s business processes based on Supply Chain Operation Reference (SCOR), to determine the causes of priority risks and then identifying risk mitigation strategies using House of Risk stage 1 (HOR1), and ranking risk mitigation strategies by considering company criteria in determining risk mitigation strategies using the Analytical Hierarchy Process (AHP). From the results of the study, 21 risk events dan 13 priority risk causes’ identified, and 9 risk mitigation strategies’ determined. Risk mitigation strategies’ rank sequentially were conducting briefings and evaluations every day, coordinating with suppliers continuously, making signboards at the warehouse, tightening the implementation of Standard Operating Procedures (SOP), providing ongoing training, evaluating supplier performance, monitoring more frequently, demand management with considering safety stock and service levels, and had supplier reserves. So, this study suggests PT.X to implement the risk mitigation strategies for minimizing the risks in the company.