The Imbalance of Supply Risk and Risk Management Activities in Supply Chains: Developing Metrics to Enable Network Analysis in the Context of Supply Chain Risk Management

From a supply chain management point of view, the flow of goods in a supply chain can be viewed as a network of goods-exchanging actors (Carter, Ellram, and Tate, 2007; Gomm, and Trumpfheller, 2004). While supply chain management activities include requirements-planning and the ordering of goods in value-added networks, activities in supply chain risk management are dedicated to the prevention of possible shortages and their negative impacts. Due to limited resources, risk management activities are usually focused on the most critical goods (Wente, 2013; Zsidisin et al., 2004). This leads to the assumption that for less critical goods, the effort for risk management activities deviates from the actual risk management demand. In order to identify these imbalances and network-related effects, metrics are developed in this paper to measure the existing level of efforts of risk management activities and the level of supply risks concerning the different supplier-buyer relations in a supply chain. In order to integrate the metrics and to locate the need for further risk management activities in a supply chain, measures of network analysis are used.