Ezgi BUZDOĞAN-LINDENMAYR, Güray KARA, A. Sevtap SELCUK--KESTEL

Assessment of supplier risk for copper procurement

Procurement risk management (PRM) requires a good understanding and assessment of all potential risks. As the procurement industry mostly functions globally and the supply--demand chain forms a dependency structure among all interested parties, the quantification of risks related to the suppliers gain importance. This study presents a systematic PRM to evaluate and quantify the risks of a commodity associated to its suppliers. The probabilistic set up using total probability theorem on the information collected using risk management tools, such as expert opinion, charts, survey and historical realizations are imposed to quantify the risks. The resulting probabilities are utilized to construct a risk matrix which illustrates the performance of each supplier at every potential risk source. An application to a copper procurement as case study is done based on the risk management process evaluation. The quantification of the supplier's risk with respect to a risk ranking illustration in copper procurement is exposed to indicate the effectiveness of the methodology and the necessity of such evaluation in decision making.

Keywords:

Procurement process, risk management, risk matrix total probability theorem, supplier risk, copper,

PDF

___

AON, The Definitive Report on Risk--Aon's 2009 Global Risk Management Survey", insight.aon.com. 2009.
Aqlan, F., Lam, S.S. A fuzzy-based integrated framework for supply chain risk assessment. International Journal of Production Economics, (2015) 31;161:54-63.
Ayyub, M. B., Risk Analysis in Engineering and Economics. Chapman & Hall / CRC: New York. 2003.
Buzdogan, E., Risk Analysis Of Procurement Activities For Copper Commodities And It's Economical Impacts. Unpublished Master Thesis. Albert Ludwigs University Of Freiburg. Germany, 2009.
Chen, J., Sohal, A. S., & Prajogo, D. I., Supply chain operational risk mitigation: a collaborative approach. International Journal of Production Research, 51(7), (2013) 2186-2199.
Farmer, D., Corporate planning and procurement in multinational firms. International Journal of Physical Distribution & Materials Management, 11(2/3), (1981), 36-45. doi: 10.1108/eb014489.
Frame, J. D., Managing risk in organizations: A guide for managers. John Wiley & Sons, 2003.
Foroughi, A., Albin, M., & Kocakulah, M., Perspectives on Global Supply Chain Supply-Side Risk Management. In Technology Management for the Global Future, 2006. PICMET 2006 (Vol. 6, pp. 2732-2740). IEEE, (2006, July).
Holmes, A., Risk Management. John Wiley & Sons Ltd: Oxford, 2002.
Hutchins, D., Just in time. Gower Publishing Ltd., Ltd, 1999.
Macurova, P., & Juraskova, K., Analysis of risks generated by suppliers during the period of economic fluctuations. Amfiteatru Economic, 15(33), (2013), 27.
Mangla S.K., Kumar P., Barua M.K. Risk analysis in green supply chain using fuzzy AHP approach: a case study. Resources, Conservation and Recycling, 104, (2015):, 75-90.
Nagali, V., Hwang, J., Sanghera, D., Gaskins, M., Pridgen, M., Thurston, T.,& Shoemaker, G., Procurement risk management (PRM) at Hewlett-Packard company. Interfaces, 38(1), (2008), 51-60. doi: 10.1287/inte.1070.0333.
Printz, S., von Cube, J.P., Ponsard, C., De Landtsheer, R., Ospina, G., Massonet, P., Schmitt, R. and Jeschke, S., A survey on risk-management and tooling support for procurement processes in supply chains. Simulation and Modeling Methodologies, Technologies and Applications (SIMULTECH), 6th International Conference on. IEEE. (2016).
Russill, M. R., A Short Guide to Procurement Risk. Gower Publishing, Ltd., 2012.
Tang, C. S., Perspectives in supply chain risk management. International Journal of Production Economics, 103(2), (2006), 451-488.
Tang, O., & Musa, S. N., Identifying risk issues and research advancements in supply chain risk management. International Journal of Production Economics, 133(1), (2011), 25-34.
Thun J.H., Hoenig D., An empirical analysis of supply chain risk management in the German automotive industry. International Journal of Production Economics. 131(1), (2011), 242-9.

Communications Faculty of Sciences University of Ankara Series A1 Mathematics and Statistics-Cover

ISSN: 1303-5991
Yayın Aralığı: Yılda 4 Sayı
Başlangıç: 1948
Yayıncı: Ankara Üniversitesi

Arşiv