Factors influencing tier 2 supply chain risk data collection

Abstract

Natural disasters such as the earthquake and subsequent tsunami that hit Japan in 2011 can have catastrophic effects on businesses. This type of unexpected event can cause millions of dollars in damages, lost sales and can impact company stock performance. With 39% of supply disruptions occurring at indirect suppliers, companies can no longer ignore their supply networks when determining supply chain risk. Unlike measuring risk within a single company, measuring the risk of a network requires collaboration amongst all players. This research aims to mitigate the complexity of data collection through the understanding of the factors that influence supply chain risk data collection. Factors vary throughout different players in the networks. Internally, supply chain transparency must be indoctrinated in the culture of the executing company. Necessary parties must be well informed and incentivized to take part in this labor intensive exercise. By indoctrinating transparency into the culture, companies legitimize this initiative to both employees and suppliers. Through a series of conversations held with suppliers, the research conducted in this thesis identifies the internal and external factors that determine success in supply chain risk data collection. Keywords: Supply chain risk management, supply chain transparency, data collection, vendor collaboration.