Managing uncertainty – an empirical analysis of supply chain risk management in small and medium-sized enterprises

Abstract

Uncertainty and the need for lean processes forces manufacturing companies to intensively deal with supply chain risk issues. The purpose of this article is the empirical investigation of supply chain risk management in small and medium-sized enterprises (SMEs). Using data from 67 manufacturing plants from the German automotive industry, differences between large-scale enterprises and SMEs are identified. After addressing the general question whether SMEs consider their supply chain as vulnerable, the key drivers of supply chain risks are analysed. Furthermore, instruments of supply chain risk management are investigated in terms of their suitability for creating a resilient supply chain by comparing SMEs with large-scale companies. Finally, this article examines existing differences with respect to how companies deal with risk. The analyses show that SMEs predominantly focus on reactive instruments that absorb risks through the creation of redundancies instead of preventing risks.