Integrated supply chain risk management: a systematic review

• Pages: 1123-1141
• Date: 13 November 2017
• DOI: https://doi.org/10.1108/IJLM-09-2016-0206
• Published date: 13 November 2017
• Author: Quan Zhu,Harold Krikke,Marjolein C.J. Caniëls
• Subject Matter: Management science & operations,Logistics

Integrated supply chain risk

management: a systematic review

Quan Zhu and Harold Krikke

Open University of the Netherlands, Heerlen, The Netherlands, and

Marjolein C.J. Caniëls

Faculty of Management, Science and Technology,

Open University of the Netherlands, Heerlen, The Netherlands

Abstract

Purpose –Supply chain risks specifically refer to risks that transmit among supply chain members, thus

they should be understood and managed as a whole for an end-to-end supply chain. The purpose of thispaper

is to review literature of integrated supply chain risk management (ISCRM) that connects supply chain

integration (SCI) with supply chain risk management.

Design/methodology/approach –The systematic literature review methodology was used to select and

categorize articles between 1998 and 2015 in peer-reviewed journals. A contingency analysis was further

applied to detect association patterns and links between category items.

Findings –Through a systematic literature review, the research has clearly analyzed risk sources, scopes

and dimensions of SCI, and scopes and dimensions of performance in the field of ISCRM. Furthermore,

by applying the contingency analysis, the paper has proposed future research directions that are based on the

extant literature findings.

Originality/value –The identified insights, gaps, and future research directions will encourage researchers

as well as managers to drive the development of ISCRM.

Keywords Contingency analysis, Supply chain risk management, Systematic literature review,

Performance measures, Supply chain integration

Paper type Literature review

1. Introduction

Modern supply chains are inter-connected. Firms increasingly depend on a complex

network of global partners to deliver products at the right time and place, in the

right quantity, and under persistent cost pressures (Datta and Christopher, 2011).

The integration of business processes across multiple firms can provide economic

benefits, thus helping maintain the competitive advantages of the firms involved.

However, such advantages are accompanied by many potential risks resulting from

intermeshed processes (Breuer et al., 2013). For instance, the Japanese earthquake and

tsunami in 2011 caused not only a local disruption on supply and demand, but also a

manufacturing slowdown in European and North American countries where they need

Japanese suppliers’inputs (MacKenzie et al., 2012). According to a recent study by

Aon Risk Solutions, the percentage of global companies reporting a loss of income due to a

supply chain disruption increased from 28 percent in 2011 to 42 percent in 2013 (Sáenz and

Revilla, 2014). Supply chain risk management (SCRM) has become a very important area

of study (Ghadge et al., 2012).

To mitigate the negative impacts of supply chain risks, various strategies, such as

redundancy (Sheffi, 2005), dual sourcing (Trkman and McCormack, 2009), and

postponement (Yang and Yang, 2010), have been discussed to provide help. However,

these strategies employ the focal firm perspective that they are internal practices with scant

insights on the integration between the focal firm and its supply chain partners. As supply

chain risks specifically refer to risks that transmit among supply chain members

(Li et al., 2015) and their magnitude and probability can be significantly influenced by

supply chain rippling and network effects ( Jüttner, 2005), they should be understood and

The International Journal of

Logistics Management

Vol. 28 No. 4, 2017

pp. 1123-1141

© Emerald PublishingLimited

0957-4093

DOI 10.1108/IJLM-09-2016-0206

Received 9 September 2016

Revised 16 November 2016

Accepted 17 November 2016

The current issue and full text archive of this journal is available on Emerald Insight at:

www.emeraldinsight.com/0957-4093.htm

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Integrated

supply chain

risk

management

managed as a whole for an end-to-end supply chain (Rao and Goldsby, 2009). The way to

achieve this goal is thus to facilitate supply chain integration (SCI).

This paper reviews literature of integrated supply chain risk management (ISCRM) that

connects SCI with SCRM. Although the idea of ISCRM has been discussed in several recent

articles (e.g. Breuer et al., 2013; Chen et al., 2012; Li et al., 2015), many concepts and

relationships in this field are still inconsistent and fragmented. For instance, some ISCRM

articles considered “environmental uncertainty”as the risk source of their research

(e.g. Chong and Zhou, 2014; Iyer et al., 2004; Wang et al., 2006, 2013; Wong et al., 2011).

However, what “environmental uncertainty”they referred to are different: most of their

research considered demand/market risks as one aspect (an exception is Wang et al., 2013,

which regarded supply risks as “environmental uncertainty”); besides demand/market risks,

Iyer et al. (2004) also checked organizational risks, while Wang et al. (2006) also looked at

competitive/technological risks; Wong et al. (2011) even studied four aspects: demand/

market, supply, competitive/technological, and organizational risks. Another example is

that it is often believed that SCI has a positive impact on performance, but Fabbe-Costes and

Jahre’s (2008) literature review indicated that 12 out of 31 studies showed that more SCI does

not always improve performance.

In addressing these critical gaps, our research provides a systematic literature review

(Denyer and Tranfield, 2009; Rousseau et al., 2008; Tranfield et al., 2003) in the field of

ISCRM. We first draw and justify the boundaries of ISCRM and related issues in Section 2.

In Section 3, we present the methodology of systematic literature review and how we

implement it in this paper. The descriptive and thematic results are summarized in

Section 4. This is followed by a contingency analysis to identify association patterns

(i.e. relationships) in the extant literature findings and provide theoretical mechanisms in

Section 5. The paper concludes with our key findings, implications for managers, and future

research directions in Section 6.

2. ISCRM

The underlining assumption of ISCRM is that there are certain risks the supply

chain has to face. Identifying risk sources is thus the first important issue of ISCRM

(Lavastre et al., 2012). In general, there are two types of supply chain risks: operational

risks and disruption risks (Chen et al., 2012; Tang, 2006). Operational risks relate to

supply-demand coordination and result from inadequate or failed processes, people, and

systems (Zhao et al., 2013). In a supply chain, supply-demand variations are raised mainly

from three sides: upstream from suppliers’performance, downstream from customers’

demand, and internally from the production and distribution processes of the focal firm

(Germain et al., 2008). In addition, competitive/technological risks are operational risks

that are faced by all supply chain members. Manifested as the extent of unpredictable

changes in the technological environment, competitive/technological risks may quickly

render existing technology obsolete. Firms need to develop better innovation capabilities

in its exchange relationships in order to stay ahead of the competition ( Jean et al., 2012).

Disruption risks are environmental risks that affect the overall business context across

industries (Ritchie and Marshall, 1993). They include legal risks caused by law and policy

changes, infrastructure risks caused by man-made issues (e.g. strikes and industrial

accidents), and catastrophic risks (e.g. terrorist attacks, epidemics, and floods) (Wagner

and Bode, 2008). To balance the coverage and condensation of all risk sources, we adapt

Rao and Goldsby’s (2009) typology of supply chain risks that ranges from the

organization itself to the environment affecting the whole supply chain: organizational

risks (i.e. the foc al organization’s production and/or distri bution risks), industrial risks

(including demand/market risks, supply risks, and competitive/technological risks),

and environmental risks (that affect the overall business context across the supply chain).

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