Abstract
Purpose
International supply chains can be severely disrupted by failures in international logistics processes. Therefore, an understanding of international logistics risks, or causes of failure, how these may interact with each other, and how they can be mitigated are imperatives for the smooth operation of international supply chains. This research specifically investigates the interactions between international logistics risks within the prevailing structures of international supply chains and highlights how these risks may be interconnected and amplified. A new dynamic supply chain logistics risk analysis model is proposed which is novel as it provides a holistic understanding of the risk event interactivity.
Design/methodology/approach
The paper applies Interpretive Structural Modelling (ISM) to data collected from a survey of leading supply chain practitioners, in order to analyse their perspectives of risk elements and interactions. The risk elements and their contextual relationship were derived empirically through the use of focus groups and subsequent Delphi study. The two stages of the research rely on experts’ views on risk events and clusters and the level of interactions among those clusters.
Findings
A key finding of this research is that supply chain practitioner’s perception of risk consists of interconnected four levels; (1) value streams risks, (2) information and relationship risks, (3) risks in international supply chain activities and (4) external environment. In particular, since Level 2 risk creates feedback loops of risks, risk management at Level 2 can dampen the amplification effect and the strength of the interactions.
Practical implications
Several managerial implications are drawn. Firstly, the research guides managers in the identification and evaluation of risk events which can impact on the performance of their international logistics supply chain operations. Secondly, evidence is presented that supports the proposition that the relationships with trading partners and LSPs, and the degree of logistics information exchange, are critical to prevent, or at least mitigate, logistics risks which can substantially affect the responsiveness of the international supply chain.
Originality / Value
The main contribution to knowledge that this study offers to the literature on SCRM is the development of a supply chain logistics risk analysis model which includes both risk elements and interactions. The research demonstrates the importance of taking into account risk interactions in the process of identification and evaluation of risk events.
International supply chains can be severely disrupted by failures in international logistics processes. Therefore, an understanding of international logistics risks, or causes of failure, how these may interact with each other, and how they can be mitigated are imperatives for the smooth operation of international supply chains. This research specifically investigates the interactions between international logistics risks within the prevailing structures of international supply chains and highlights how these risks may be interconnected and amplified. A new dynamic supply chain logistics risk analysis model is proposed which is novel as it provides a holistic understanding of the risk event interactivity.
Design/methodology/approach
The paper applies Interpretive Structural Modelling (ISM) to data collected from a survey of leading supply chain practitioners, in order to analyse their perspectives of risk elements and interactions. The risk elements and their contextual relationship were derived empirically through the use of focus groups and subsequent Delphi study. The two stages of the research rely on experts’ views on risk events and clusters and the level of interactions among those clusters.
Findings
A key finding of this research is that supply chain practitioner’s perception of risk consists of interconnected four levels; (1) value streams risks, (2) information and relationship risks, (3) risks in international supply chain activities and (4) external environment. In particular, since Level 2 risk creates feedback loops of risks, risk management at Level 2 can dampen the amplification effect and the strength of the interactions.
Practical implications
Several managerial implications are drawn. Firstly, the research guides managers in the identification and evaluation of risk events which can impact on the performance of their international logistics supply chain operations. Secondly, evidence is presented that supports the proposition that the relationships with trading partners and LSPs, and the degree of logistics information exchange, are critical to prevent, or at least mitigate, logistics risks which can substantially affect the responsiveness of the international supply chain.
Originality / Value
The main contribution to knowledge that this study offers to the literature on SCRM is the development of a supply chain logistics risk analysis model which includes both risk elements and interactions. The research demonstrates the importance of taking into account risk interactions in the process of identification and evaluation of risk events.
| Original language | English |
|---|---|
| Pages (from-to) | 372-389 |
| Number of pages | 18 |
| Journal | International Journal of Operations & Production Management |
| Volume | 38 |
| Issue number | 2 |
| Early online date | 5 Feb 2018 |
| DOIs | |
| Publication status | Published - 2018 |
Bibliographical note
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- Supply chain risk management
- Risk analysis
- Risk interactions
- Interpretive structural modelling
- International Logistics