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Introduction:
Supply chain serves as the backbone to any organization’s business activities. It allows keeping the overall activities intact. The disturbance in the supply chain processes can result in serious turbulence. Supply chain being involved with external elements and stakeholders is subject to many risks; these risks may be as a result of slow processing, physical constraints, communication obstacles, environment or any other factor that impedes the natural flow of activity. A recently published survey established that the rate of direction and concentration towards supply chain risks faced is considerably low, and only in three organizations pay heed to the risks faced on this front (Allan, 2013), this comes despite the fact that the businesses have gone global and digital and minor disturbance in this ambit can create real havoc in the ranks of organization.
Thesis Statement:
Presence of an effective supply chain has become imperative in modern times, at the same time the risks have grown multi fold and effective policies and scheme of actions must be in place in order to have successful supply chain operations working.
The first step to mitigation of any challenge or obstacle is the identification of risks faced. The same runs valid for supply chain activities, and thereby the determination of areas and domains that possess any risks must be identified at earliest level of operations and processing.
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Supply Chain Risk Management:
SCRM constitutes the plan, policy and course devising that enables solving the problems, risks and challenges faced in field of supply chain. During this course the possible causes are determined, their impacts are evaluated and estimated and furthermore course of pattern is designed and defined through which any intended and potential obstacles are prevented from occurrence. SCRM enables looking into all the facets that may pop up as a challenge and obstacle. It looks into the processing part, the financial segment of the organization and partnership, the resources used, the material incorporated and the logistics used. Ericson (Reference) is one similar name and company that comes to mind which suffered heavily due to the turbulence in the field of supply chain and it can be attributed to the weak or non presence of effective SCRM(Musa, 2012).
Prioritization:
The next level and wise move is to prioritize the risks and subsequent activities. Prioritization allows for preventing any major loss and enables operating in a step wise process.
Types of risks:
Supply chain risks may show up in any form, ranging from electronic means to physical; to communication interruption; loss of partners; delay in processing; societal and geographic nay different elements can come up and pose a threat to the entire process of supply chain.
Channels of communication:
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Numerous elements serve as variables of risks posed by supply chain operations; one of the basic challenge that may be faced is in form of the communication channels in place. The channels so existent must be supported by backups that will facilitate the performance of activities even if the first source goes down. In modern times when everything is reliant on the digital means of communication, establishing multiple networks and paths is vital in this regard. Communication may also refer to the physical paths and terrains that are in route and used for transportation of goods and other valuables between the partners within a business venture (Sounderpandian & Sinha 2007, 282).
Geographical factor consideration and impact:
The location of a warehouse is highly important and of central value towards effective supply chain, making sure that the operations are being carried out between the given regions that enjoy complete peace and stability in terms of the transportation, and other basic requirements fulfillment of the supply chain operations. A war hit country or a country with no assurance of safe transit for goods and services from and across the borders will only add to the risks with regard to the supply chain operations.
The type of government in place:
Governmental mood, infrastructure and policies have large impact on the overall supply chain activities. A business friendly government will definitely add and aid the business operations; they will be mindful of the facts which encourage the free and safe business functions and at the same time would also make sure eliminating any obstacles that stand in the way of successful business activities between partners spread across the spectrum. Political stability is another
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factor, politics of violence, aggression, turbulence and agitation leads to build up of positive economic prosperity.
Ensuring accuracy in delivery processes:
In the course of supply chain activities, the timing of delivery is highly precious. A delay either way can lead to failure of the entire venture undertaken, thereby making sure that all the channels of communication are intact, synchronization is established and the right kind of items and services are delivered at the appropriate time constitute the delivery accuracy constraint. Keeping a correct account of inventory is another solution to countering the risks (Kersten, 2011,69).
Industrial processes:
Making sure that the internal processes and manufacturing plants live up to the expectations and deliver the goods and other services in time, this makes up for one of the dimension of covering the risks posed in the field of supply chain. Clarifying the dos and don’ts to the employees about the processes and plant machines also constitute for successful supply chain operations.
How to mitigate the risks:
The mitigation process may include short scale to mid and large scale activities and options. Brainstorming, providing the right kind of tool and technique, guiding the individuals involved in the organization who directly deal with the supply chain operations, ensuring transparency in processes, creating good relationship with the member partners across the board( both within the
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organization and outside), creating an effective SCRM team and planning action all constitute the mitigation plan of course.
Contingency plans:
Always keeping a second option in bag allows for completion of the journey in a safe manner. Thereby alternatives must be up the sleeve in form of routes, communication sources, plans and policies, partners and all other variables that may fall short and may be subject to any kind of dispersal and distortion in the entire course of supply chain activity.
Conclusion:
Ever since the supply chain mechanism has embroiled into a global phenomena of exchange, it is almost a sin to consider and allow for negligence in the field of supply chain operations. The realization is gradually gaining momentum across the board and organizations are hiring special teams and experts who would enable them countering the challenges faced. It can be safely said that the success in supply chain domain of organization is akin to the success of overall organization and its businesses undertaken.
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Works Cited:
Allan, C. (2013, August 12). Firms pay "Marginal attention" to supply chain risks. Retrieved from supplymanagement: http://www.supplymanagement.com/news/2013/firms-pay-marginal-attention-to-supply-chain-risk/
Kersten, W. (2011). International Supply Chain Management and Collaboration Practices. BoD – Books on Demand.
Musa, S. N. (2012). Supply Chain Risk Management:Identification, Evaluation and Mitigation Techniques. Linköping: Linköping University.
Sounderpandian, J., & Sinha, T. (2007). E-business Process Management: Technologies and Solutions. Idea Group Inc.
