Supply Chain Risk

In recent years, the question of how to ensure process continuity in relationships between supplier and customer has been getting more attention in academic discussion and commercial practice. This is due to a significant increase in levels of risk, in particular in international supply chains. The main reasons for this increase are the following: • globalisation, outsourcing and offshoring strategies, which translate into increasingly complex supply chains due to the diversification of links involved in the process of the flow of information and goods and, consequently, heightened uncertainty in relationships between supplier and purchaser; reduction of the supplier base, single sourcing and global sourcing;concentration of manufacturing sites and suppliers in a single location, central distribution;focus on efficiency rather than effectiveness and flexibility (Jüttner, Peck and Christopher 2003, pp. 197–210);new threats, including terrorism (the attack on the World Trade Center triggered increased attention to the issue of international security); climate change (Australian Greenhouse Office 2006, p. 16) (the number of natural disasters has doubled over the last 20 years (The Center for Research on Environmental Decisions 2008, p. 10));