Using Scenario Planning to Supplement Supply Chain Risk Assessments

Abstract

A fundamental component of supply chain risk management is the process of assessing risk in order to make decisions about how to best manage it. In assessing risk, analysts and leaders commonly focus on their near-term environments, overlooking key indicators that might evolve into significant future risks. We propose the use of scenario planning as a supplement to traditional supply chain risk assessment paradigms and practices, and we describe the scenario planning process within the context of supply chain risk management. This chapter does not propose a panacea for the challenges associated with supply chain risk management; rather, it proposes a method of raising and enhancing the level of risk awareness among decision-makers who attempt to manage it.