The Role of Supply Chain Risk Management in Gaining Competitive Advantage
Sipilä, Antti (2024-05-10)
The Role of Supply Chain Risk Management in Gaining Competitive Advantage
(10.05.2024)
Julkaisu on tekijänoikeussäännösten alainen. Teosta voi lukea ja tulostaa henkilökohtaista käyttöä varten. Käyttö kaupallisiin tarkoituksiin on kielletty.
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Julkaisun pysyvä osoite on:
https://urn.fi/URN:NBN:fi-fe2024052033358
https://urn.fi/URN:NBN:fi-fe2024052033358
Tiivistelmä
Supply chain risk management (SCRM) has experienced an uptick in relevancy and interest among supply chain managers, as large-scale disruptions in supply chains have become more common. With disruptions being of global scale, so too are modern supply chains becoming increasingly global in nature, with chains consisting of numerous suppliers all over the world being normal. Recent worldwide events have caused major difficulties in securing the flow of material, components, and services, which has made companies that best manage their supply chain risks fare better than their competition. Effective management of supply chain risks could be an impactful tool to create and gain competitive advantage in the field of supply chain management.
Supply chain risk management allows companies to prepare for and mitigate the effects disruptions could have, resulting in no noticeable impact for the end-customer in the supply chain. Supply chain risk management is preparative in nature, as disruptions are difficult to foresee. A new way of looking at supply chain risk management is a concept called supply chain antifragility, which seeks opportunities for growth in disruptions.
Competitive advantage is typically gained through superior performance in creating value, thus making the company be able to compete with cost leadership and scaling of their production. Differentiation can also help gain competitive advantage, especially in a field of business such as supply chain management, where a whole chain is difficult to replicate, as they are so complex. Superior supply chain performance indicates that a supply chain has correctly aligned its strategy with the rest of the business, uses information systems that work well with its needs, and it is able to share key information with its partners in timely manner, resulting in improved value creation performance.
Supply chain risk management’s role in gaining competitive advantage is substantial, as supply chains are increasingly used as competing elements in business. Even though global incidents affecting supply chains are rare, they have been proven to be getting more frequent. This encourages companies to prepare for them through supply chain risk management. Though preparation for an event that can’t be foreseen will take up resources, the cost of not doing so will be drastically higher than the cost incurred by actions done in the name of risk management.
Supply chain risk management allows companies to prepare for and mitigate the effects disruptions could have, resulting in no noticeable impact for the end-customer in the supply chain. Supply chain risk management is preparative in nature, as disruptions are difficult to foresee. A new way of looking at supply chain risk management is a concept called supply chain antifragility, which seeks opportunities for growth in disruptions.
Competitive advantage is typically gained through superior performance in creating value, thus making the company be able to compete with cost leadership and scaling of their production. Differentiation can also help gain competitive advantage, especially in a field of business such as supply chain management, where a whole chain is difficult to replicate, as they are so complex. Superior supply chain performance indicates that a supply chain has correctly aligned its strategy with the rest of the business, uses information systems that work well with its needs, and it is able to share key information with its partners in timely manner, resulting in improved value creation performance.
Supply chain risk management’s role in gaining competitive advantage is substantial, as supply chains are increasingly used as competing elements in business. Even though global incidents affecting supply chains are rare, they have been proven to be getting more frequent. This encourages companies to prepare for them through supply chain risk management. Though preparation for an event that can’t be foreseen will take up resources, the cost of not doing so will be drastically higher than the cost incurred by actions done in the name of risk management.