Campus Units

Supply Chain and Information Systems

Document Type

Book Chapter

Publication Version

Accepted Manuscript

Publication Date

4-18-2019

Journal or Book Title

Handbook of Ripple Effects in the Supply Chain

Volume

Chapter 4

First Page

85

Last Page

100

Abstract

Supply chains are highly complex systems, and disruptions may ripple through these systems in unexpected ways, but they may also start in unexpected ways. We investigate the causes of ripple effect through the lens of systemic risk. We derive supply chain systemic risk from the finance discipline where sources of risk are found in systemic risk-taking, contagion, and amplification mechanisms. In a supply chain context, we identify three dimensions that influence systemic risk, the nature of a disruption, the structure, and dependency of the supply chain, and the decision-making. Within these three dimensions, there are several factors including correlation of risk, compounding effects, cyclical linkages, counterparty risk, herding behavior, and misaligned incentives. These factors are often invisible to decision makers, and they may operate in tandem to exacerbate ripple effect. We highlight these systemic risks, and we encourage further research to understand their nature and to mitigate their effect.

Comments

This accepted book chapter is published as Scheibe K.P., Blackhurst J. (2019) Systemic Risk and the Ripple Effect in the Supply Chain. In: Ivanov D., Dolgui A., Sokolov B. (eds) Handbook of Ripple Effects in the Supply Chain. International Series in Operations Research & Management Science, vol 276. Springer, Cham. Posted with permission.

Copyright Owner

Springer Nature Switzerland AG

Language

en

File Format

application/pdf

Published Version

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