Risks prioritization in global supply networks using MICMAC method: A real case study

Abstract

Modern supply chains are very complex and suffer always from various risks. An effective supply chain management requires suitable strategies to mitigate them. In literature, there has been a range of research into risk in purchasing and supply, but little in global and integrated supply networks. This can be explained due to the huge number of risk variables and their direct and indirect interrelations that may suffer all supply chain partners. Therefore, for better risk management process, the risk prioritization step is vital. The purpose of this paper is to apply a structural modeling technique for risk analysis and prioritization through a real case study of Masmoudi pastry supply network. Firstly, thirty risk variables have been identified through literature survey, interaction with industry experts, and various interviews with the supply key managers. Secondly, MICMAC method is applied to recognize both direct and indirect relationships between these thirty risk variables, and to ascertain the most prioritized risk variables. This prioritization provides a useful tool to Masmoudi pastry managers to differentiate between independent and dependent risk variables and their mutual relationships which would help them to focus on those key variables that are most important for an effective risk mitigation management.