Supply chains and risk

One area in which both business practitioners and policy makers are immediately able to perceive the significance of the supply chain concept is in the new risks that have materialised in an increasingly interconnected world . Isolated events such as the September 11 attack in the United States in 2001, the Eyjafjallajökull volcano in Iceland, the Fukushima disaster resulting from the Tohoku earthquake and tsunami in 2011, and flooding in Thailand in the same year now precipitate waves of uncertainty that travel faster and further than ever before. Perhaps unsurprisingly, the literature on risk and supply chains is one of the most advanced in theoretical development and operational applicability among the supply chain issues reviewed in the literature. In this chapter, we review the central concept of supply chain risk management (SCRM) and provide a more in-depth analysis of the SCRM framework’s underlying concepts of risk identification, assessment, and mitigation.