Supply chain risk management dimensions in Indian automobile industry

Abstract

Purpose – Globalization and outsourcing have rendered Indian automotive companies more vulnerable to supply chain (SC) risks. Consequently, companies adopt different supply chain risk management (SCRM) strategies to mitigate SC risks. The purpose of this paper is to explore SCRM strategies in Indian automobile industry and to classify automobile firms based on SCRM dimensions. Design/methodology/approach – A survey instrument on SCRM dimensions was designed and data were collected from 79 automobile firms. Principle component analysis (PCA) was performed on the collected data to derive the factors underlying SCRM dimensions. Further, cluster analysis using extracted factors as a clustering variate was performed to identify strategic groups from the given set of firms. Findings – PCA derived seven factors, namely: avoidance, supplier development, flexibility, risk pooling, redundancy, integration and control strategies. The surveyed firms were classified into two clusters as low and high SCRM level. Research limitations/implications – A limitation of this study is that data were collected from a single industry and in a single country. Practical implications – Understanding of SCRM dimensions shall increase the use of these dimensions and firms can mitigate negative effects of SC risks. The detailed operationalization of SCRM strategies highlights the importance of three strategies: avoidance, integration and supplier development. Managers’ understanding of SCRM strategies will improve the firm's performance and business excellence. Originality/value – This research empirically validates SCRM strategies and investigates how these create differences among firms.

Conceptualising the moderating role of knowledge management within supply chain risks and supply chain risk management

“…Such disasters severely impact on the supply chain depending on where they strike. If a major trading partner in the chain suffers, then all supply chain members will be severely impacted (Kumar and Bhat, 2014). e. Financial risk: Financing is required in every level of the business of the firms.…”

“…Risk identification: Some researchers (Behzadi, O'Sullivan, Olsen, and Zhang, 2017;Sodhi et al, 2012;Tummala and Schoenherr, 2011) have argued that SCRM is initiated with risk identification. With the risk identification, the SCRM can trigger any risk management activity with the purpose of discovering all of the related risks (Kumar & Bhat, 2014). Risk identification implies that early forecasting is required to judge the severity of the risk and thus, if it will be further assessed or not (Kern et al, 2012).…”

Taxonomies of trust in supply chain risk management in the South African third party logistics industry

“…There needs to be an alignment of the cultures and values of the two organisations so as to create a long-lasting relationship (Spence et al 2018:143). A buyer-supplier relationship is an area that needs constant attention to maintain and even improve upon the benefits achieved (Kumar Sharma & Bhat 2014:1025. The presence of risk sharing in a relationship can have significant http://www.actacommercii.co.za Open Access advantages for a supply chain network (Ghadge et al 2017:264).…”

Supply chain risk management processes for resilience: A study of South African grocery manufacturers

“…Reactive strategies include dual sourcing, multiple sourcing and safety stocks (Kumar Sharma & Bhat 2014:1025-1027Thun et al 2011:5517-5518).…”

“…Before choosing a risk mitigation strategy, each risk facing the supply chain must be evaluated against the mitigation strategies available to the firm. In order to choose a relevant mitigation strategy for any risk, a cost-benefit analysis needs to be undertaken with risk appetite as a constraint (Diehl & Spinler 2013:317;Kumar Sharma & Bhat 2014:1032. In completing the SCRM process, firms need to follow through to risk monitoring.…”