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Importance Of Supply Chain Management

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Sammer Kumar, Katie J. Himes and Collin P.Kritzer states that it is very important to any organization for estimating risk related with their supply chain management, therefore, solutions and approach are helpful to manage risk. Tang (2006) defined that natural disaster not only the damage to a supply chain, some examples of human activities such as wars, labor strikes and so on that has effect to supply chain. Poor management system also will influence the flow of supply chain in an organization if the same supplier can have was shut down their organization due to a natural disaster such as floods. Organization could not control the occurrence of natural disasters. Because of supplier lack of financial support and was to close operation, therefore …show more content…
Risks through network are becoming more and more to organizations which is included private information, cash flow and so on. Therefore, Jabbour et al. (2011) defined supply chain management (SCM) also in search of strategies and solutions to improve the competitive performance in network business environment which is related to the planning and control of materials, cash flows and information in its membership. Oehmen et al. explained that managers in business state are hope for decrease the organization’s exposure to uncertainty via implementation of efficient and effective risk management approach. Hence, organizations or firms definitely to adopt regular strategies for supply chain risk management. In the same way, Tang (2006) stated consumer demands, economic business cycles, and man-made and natural disaster causes uncertainties thus all gains sources for supply chain risks in business environment. However, Handfield and McCormack (2007) had explained operational, network, and external factors as types of supply chain risks. The examples of operational risk such as quality, service, and delivery problems. Secondly, the network risk can be observed from the structure of the supplier network, and the examples such as individual supplier strategies, supply network agreements, and ownership. External risks are resulting from external force …show more content…
(2008) defined that customer value and profits can be maximized through implementation of efficient and effective supply chains. Efficient and effective supply chains are helpful to any firms to survive and stable in global business environment. In addition, Hakansson and Persson (2004) claimed that supply chain management can be a systematic management concept which can contribute to organizations in terms of profitability and competitiveness. Nowadays, the increasing of firms is making each other to plan useful strategies to survive in competitive business environment. Therefore, Cowell et al. (2007) noted Bayesian computational concept is a useful tool for emergent situation for a wide range of risk management implementations. Bayesian computational concept is the network for the researchers were able to establish risk elements and acceptable risk limits for all properties and assets included in the DoD supply chain. Besides that, development of supply chain risk management program must be deployed in focused on contingency planning and disaster preparedness. Therefore, risk management programs are designed to reduce the appearance of natural disaster, human-made disaster, and other risk

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