Supply chain risk management professionals have to contend with a large number of internal, external, network, economic, environmental, geo-political, and compliance risks on a daily basis. From an internal perspective, there could be production line failures, quality problems, unpredictable raw material or parts shortages, sabotage by disgruntled employees, strikes, and pandemics that cause a large portion of the workforce to become suddenly unavailable for work. From an external perspective, a new technology or business model could emerge that disrupts normal operations across the supply chain. From a network perspective, outsourcing, third party logistics, and vendor managed inventory carry their own risks as do communication network failures, customs delays, and supplier bankruptcies. From an economic perspective, an organization has to contend with the inherent unpredictability of supply and demand, currency valuations, and global financial markets. From an environmental perspective, an organization has to be prepared for natural disasters such as earthquakes, hurricanes, and typhoons. From a geo-political perspective there are acts of sabotage, theft, terrorist attacks, and wars to contend with. And from a compliance perspective there are dozens of security, free trade zone, and customs acts and regulations that need to be satisfied.

Fortunately, modern strategies for supply assurance and cost containment are varied and more complex than the classic strategies of safety margins, just-in-case inventory, reserved capacity, and order expediting which often carried as much risk as they mitigated. Today, supply chain risk managers employee production versatility, concurrent processes, decision postponement, advanced sourcing strategies, business process management techniques, market intelligence, incentives, price hedging, and forward-thinking contracts as part of their risk-mitigation tool kit, tackling strategy, market, implementation, performance, demand, and human risk in the process.

For a much deeper dive into Supply Risk Management, I refer you to the e-Sourcing wiki paper^*. For more information on select areas of risk management and mitigation strategies, please see the following posts:

• A Great Guide to Outsourcing Risk Management, Part I
• A Great Guide to Outsourcing Risk Management, Part II
• A Great Guide to Outsourcing Risk Management, Part III
• A Great Guide to Outsourcing Risk Management, Part IV
• A Great Guide to Outsourcing Risk Management, Part V
• Managing Business Risk
• Key Concepts for Major Procurements
• Real Risk
• Five Types of Supply Risk, and How to Mitigate Them
• Winning the Battle on Risk: Information and Technology
• Disaster Management Lessons from the Private Sector
• Procurement Contract Risk Management
• Tips to Manage Demand and Compliance Risk
• Avoiding Risk Management Pitfalls
• Purchasing’s Best Practices in Risk Management
• What You Can’t Afford Not to Know About Your Suppliers
• Risk is Everywhere!
• Risk is Everywhere! Part II
• Strengthen Your Supply Chain
• Supply Risk — Seize the Initiative!
• Risk is on the Rise … But You Can Do Something About It!
• Equipment Breakdown Risk Management
• Get a Grip on Supplier Risk
• Supplier Management Works … Even in the Public Sector
• SCM Implementation Risk Minimization
• Is Your Legal Team Ready?

^* The e-Sourcing Wiki was created and maintained by Iasta, which was acquired by Selectica in 2014 (which renamed itself Determine in 2015). It was retired by Determine (which did not actively maintain it) before Determine was acquired by Corcentric in 2019