Globalization has made handling them when they occur more difficult and expecting disruptions. Although firms originally transferred production offshore to countries such as India and China to take advantage of lower labor prices, events for example Iceland's 2010 volcanic eruption and also the Japanese tsunami in 2011 have shown the exposures of lengthy supply chains are real and serious.
Lean supply chain practices, designed to keep prices low in a stable business environment, can increase danger levels during disruptions because of the lack of buffer ability. Companies also have to pay attention to the client side while they have a tendency to focus on the supply side of their supply chains when scanning for potential risk factors. Strategies to risk management such as enterprise risk management (ERM) and business continuity management (BCM) can help firms avoid supply-chain disruptions and regain ordinary operations immediately. But in the authorsview, they rely too heavily on hazard identification when several of the dangers are not predictable or unknowable before the fact.
Companies also depend on statistical information that will not exist and address each danger alone. Eventually, they are predicated on the goal of returning to a secure operating condition. The framework, which they call Management and Supply Chain Resilience Assessment (SCRAM), is based on an explicit depiction and prioritization of the capabilities that help an organization anticipate and beat disruptions, as well as the vulnerabilities that make an organization susceptible to disruptions. The framework was made to establish priorities for capabilities which need to be reinforced and to help businesses identify their most significant supply chain vulnerabilities.
PUBLICATION DATE: January 01, 2015 PRODUCT #: SMR515-PDF-ENG
This is just an excerpt. This case is about LEADERSHIP & MANAGING PEOPLE
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