Supply chain risk in turbulent environments—A conceptual model for managing supply chain network risk

Abstract

Supply risk or the likelihood of supply disruptions is emerging as a key challenge to supply chain management. The ability to identify which supplier has greater potential of a disruption is a critical first step in managing the frequency and impact of these disruptions that often significantly impact on the supply chain. This paper presents preliminary research concepts regarding a new approach to the identification and prediction of supply risk. This approach to the assessment and classification of suppliers is based on supplier's attributes, performances and supply chain characteristics, while it is also modified by factors in the supplier's specific environment. The challenges posed to supply chains due to a turbulent environment (both from within the industry and external influences) are examined. A new method for the assessment and classification of suppliers based on their characteristics, performances and the environment of the industry in which they operate is presented. The findings are explained within the contingency theory.