Literature Review : Literature Analysis And Approach For Risk Management

The timing of capacity changes also needs to be taken into consideration to achieve maximum efficenty given that demands of their products varies with seasonal changes. The ability to react to market demand changes quickly will determine manufacturers flexibility in keeping up with these demands. Manufacturers needs facilities to produce, whether warehouses to store its raw materials or finished goods, or manufacturing plants to produce their products. Services facilities are needed by certain manufacturing industries such as consumer electronics to cater for returns. Distribution centres also determine the efficenty of production distribution and un-nesessary inventory holding will result in higher holding cost. Such facilities require large investments and are integral of the manufacturer’s supply chain strategy and thus proper planning is needed when making these decisions regardong the size, location which affect the overall operations. How manufacturers run their productions also determine how successful will they be in terms of productivity and quality levels. Different types of equipment and processes also affect the cost and output of the manufacturing plant. Information systems that flow both upstream and downstream affects the forecasting, planning, inventory and production levels, they must be robust to ensure the manufacturing firm is able to react accordingly to changing demands and variations. In addition to their internal environment,

Supply Chain Management: An International Journal, Volume 7, Number 5, 2002, pp. 271 – 282;

Today’s global supply chain has been shaped by the past decades of focus and strategies based on achieving the lowest operational costs coupled with a push towards market expansion and supplier outsourcing. The expansion of global supply chains combined with the increasing number of joined connections to external business partners has significantly raised the possibility for supply chain disruptions (Poirier, Quinn, & Swink, 2010). In today’s global business environment, the importance of risk management continues to grow daily.

A Customized Textbook, Supply Chain Management SCHM2301, ISBN9781308037400 Copies are on reserve in the library

Importantly, the quality of the risk assessment is dependent on the quality of the information available. Sometimes the client’s situation requires urgent actions, and a complete assessment is not possible (Bland et al., 2009, p. 144).

As noted previously, the definition of risk changes depending on which literature is being examined, and what context the definition is provided in. The lack of a consistent definition can make it difficult for clinicians and researcher’s developing risk assessment, because it can muddy the picture of what exactly a risk tool is attempting to quantify. That being said, the best approach when attempting to quantify risk appears to be, as suggested by several researchers, to gather as much information as possible and then make an informed decision (Prentky & Righthand, 2003; Worling et al., 2001, Rich, 2009 Vilojen et al.,

Carroll, R.L. (2009). Risk management handbook for health care organizations. San Francisco, CA: Jossey-Bass. Retrieved from http://newclassroom3.phoenix.edu

According to Freeney & Murphy ( 2013) risk management is a process of risk identification, response development, risk evaluation, continuous observing and appraisal in order to reduce the risk of injury to patients, staff and visitors. Risk has been defined as “the chance of something happening that will have an impact on the achievement of organisational stated objectives,” HSE (2008) or “the effect of uncertainty on the objectives” ISO 31000 : 2009.

The presence of certain types of risk can cause concern amongst the public especially if they are uncertain about the outcome.

When dealing with closed loop supply chains, complexity increases, management information systems may have to be restructured, and uncertainty may also build up. “Several sources of uncertainty were identified such as demand, availability of raw materials, prices, promotion of new products and for the closed-loop supply chains uncertainty in the amount of non-conformance products or on the level of returnable end of life products”.(Cardoso,Science direct). Demand levels and other

The most common implementations of supply chains throughout the US Army are focused on logistics and ensuring a continual stream of supplies to each base and installation. The periodic nature of supply chain planning for each base is made more challenging due to the need for greater levels of accounting accuracy and more effective approaches to statistical analysis of supply chain performance. These constraints over time have often been factored into the development of linear programming models used for simulating overall supply chain performance (Trainor, Parnell, Kwinn, Brence, 2007). Linear programming concentrates on solving complex supply chain problems including constrained logistics flows across multiple depots, locations and

(Bowersox, D.J., Closs, D.J., and Cooper, M.B. (2010). Supply Chain Logistics Management. (3rd Edition) New York, NY: McGraw-Hill/Irwin.

1We would like to thank Shiming Deng for his valuable contributions to the preparation of this manual.

Tomlin and Wang [27] consider a single-period newsboy setting with supply disruptions; they model loss-averse and conditional value-at-risk (CVaR) objectives when deciding between single- and dual-sourcing and between dedicated and flexible resource availability. Chen et al. [7] consider multi-period inventory models with risk-aversion, modeling both replenishment and pricing decisions. Tomlin [25] also considers a multi-period setting and employs a mean–variance approach to consider risk in a two-supplier system in which one supplier is subject to disruptions and the other is perfectly reliable but more expensive. He uses risk-averse objectives to decide between single- and dualsourcing.

The second strategy is coping with uncertainty especially adapting and minimising the impact of uncertainty on the demand. The purpose of this strategy is based on the flexibility approach of the supply chain. It also has a double effect on the supply chain by reducing uncertainty and a much better sharing information than the first strategy. The final one, researching gaps is built around developing contingency-based study of supply chain uncertainty which includes the management strategies’ threat and their impact on sources of uncertainties in order to verify their efficacy.