Project 5 - supply chain risk management.docx - Running...

Running head: SUPPLY CHAIN RISK ANALYSIS
SUPPLY CHAIN RISK ANALYSIS
Name
March 3, 2019

2
SUPPLY CHAIN RISK ANALYSIS
Introduction
A supply chain “is a network between a company and its suppliers to produce and
distribute a specific product”[Wil171]. Getting a product or providing a service to a customer
needs to be efficient and effective. This process also needs to ensure that value is added in each
step so that the company is able to sustain its competitive advantage. In a perfect world, this
process would function perfectly and everything would go according to plan but that doesn’t
always happen and this unexpectedness creates risks for companies which needs to be managed
accordingly.
Due to globalization and advancement in IT, this becomes even more tricky as more
parties are in now involved in the supply chain. One needs to not just look at the internal supply
chain management teams but also focus on the external members which are the suppliers,
manufacturers, retailers and more. The supply chain is interconnected and that interconnectivity
now can easily involve people from all over the world with different cultures, different
capacities, different objectives and different technological ability. It is logical that information
would be shared with the supply chain members and that increases the risk that the information
can be compromised which could be detrimental to the success of the company. Additionally,
technology is integrated and implemented into the supply chain management process which has
its benefits but also creates risks which company needs to secure itself against and that is where
cyber security comes in [Kod17].
This digital transformation of the global supply chain has brought the focus on new
things such as cloud storage, predictive analytics, e-sourcing, e-purchasing, and more. Hence,
companies need to keep track of their entire value chain and must have risk management

3
SUPPLY CHAIN RISK ANALYSIS
strategies to address cyber threats to any component of the supply chain. As global supply chains
are so complicated and intricate, it is tough to avoid cyber related supply chain risks and
therefore requires the input of everyone involved in the chain [Kod17]. It’s either everyone
moves forward together or any weakness from one party can sink everyone. A company might
have a great cyber security management program but the third parties they deal with might not
and therefore it is extremely crucial for the sustainable future of the business that everyone
cooperates and work together to ensure that there is no weak link in the supply chain. An
example of this was when Hewlett Packard in their regular course of business which was to
improve their bottom line offered a Russian defense agency the code for a program called
ArcSight. This program was heavily used and relied upon by the Pentagon and also used by
companies in the private sector. As HP provided the code for this program, they created a