Mitigating Risk during Strategic Supply Network Modelling

• Nikolaus Müssigmann

The purchasing function in many companies has gone through drastic changes over the last years due to various reasons. Cost pressure has forced companies to streamline their organization and to concentrate on core competencies. Therefore supporting services and products are outsourced to partners and the vertical integration is being reduced. New customer centric production methods like mass customization or Build/Configure-to-Order have evolved demanding a high level of flexibility in the organization as well as in the business processes. The success of a company depends more and more on the successful management of its partners especially the suppliers. Therefore purchasing has turned from a business support function into a strategic organizational unit. One main function of strategic purchasing is to reduce supply risk by facilitating efficient methods for supplier selection and supplier development. In many branches like the automotive industry complex supply networks arose spanning multiple tiers of suppliers. Therefore a paradigm shift has been discovered in purchasing in managing complete supply networks instead of direct suppliers. Identifying and mitigating supply risk in entire supply networks is one of the main challenges purchasing is exposed to.

Seiten 213 - 226