The Importance of Risk Management in Supply Chain

Oct 13, 2025 by vinooalluri.com 127 views

Introduction

In today's fast-paced business world, supply chain management has become an essential aspect that cannot be ignored. Various companies, including PT. Expravet Nasuba, have adopted supply chain management to improve operational efficiency and competitiveness in increasingly fierce markets. However, in the application of this system, potential risk cannot be avoided and can affect the continuity of the supply chain process. Disorders that occur in the supply chain can cause the management of raw materials to become finished products, which in turn can harm the company.

The Importance of Risk Management in Supply Chain

Realizing the importance of risk management in the supply chain, PT. Expravet Nasuba conducted research using the House of Risk (HOR) model. This model consists of two main phases. The first phase focuses on identifying risk and risk agents, followed by the measurement of the Risk Potential (ARP) aggregate. Through this approach, companies can map the risks that may occur in the supply chain systematically.

The House of Risk (HOR) Model

The House of Risk (HOR) model is a comprehensive framework for risk management in supply chain systems. The model consists of two main phases: risk identification and risk handling. The first phase involves identifying risk events and risk agents that contribute to potential disturbances in the supply chain. The second phase involves providing advice on risk mitigation action to reduce the impact of identified risks.

Risk Identification Phase

The first phase of the HOR model focuses on identifying risk and risk agents. This phase involves a comprehensive analysis of the supply chain system to identify potential risks and risk agents. The research team at PT. Expravet Nasuba identified 60 risk events and 34 risk agents that contribute to potential disturbances in the supply chain. This comprehensive risk recognition is very important, because a good understanding of existing risks will facilitate the company in designing effective mitigation strategies.

Risk Handling Phase

The second phase of the HOR model involves risk handling. Here, the research team provides advice on risk mitigation action, which is divided into 13 specific actions. These actions are designed to reduce the impact of identified risks. With the design of a strategic supply chain system and clear mitigation action, it is expected that PT. Expravet Nasuba can be more prepared to face challenges and disruption that may arise.

Implementation of Effective Risk Management

Implementation of effective risk management at PT. Expravet Nasuba will not only protect the supply chain process from potential threats, but also strengthen the company's position in the industry. By minimizing risk, companies can ensure operational smoothness, increase customer satisfaction, and achieve greater profits. Effective risk management will also enable companies to respond quickly to changes in the market and adapt to new challenges.

Conclusion

Overall, this research shows that supply chain management supported by the House of Risk model can provide valuable insights for the company. Through good risk management, PT. Expravet Nasuba will be able to survive and compete effectively in a growing market. This systematic approach emphasizes that managing risk is an integral part of a successful business strategy.

Recommendations

Based on the findings of this research, the following recommendations are made:

PT. Expravet Nasuba should implement the House of Risk model to identify and mitigate potential risks in the supply chain.
The company should develop a comprehensive risk management plan that includes risk identification, risk assessment, and risk mitigation strategies.
The company should establish a risk management team to oversee the implementation of the risk management plan and ensure that it is effective.
The company should provide training and education to employees on risk management and supply chain management to ensure that they understand the importance of risk management and how to implement it effectively.

Limitations of the Study

This study has several limitations that should be noted. Firstly, the study was conducted at a single company, PT. Expravet Nasuba, and the findings may not be generalizable to other companies. Secondly, the study only focused on the House of Risk model and did not consider other risk management models. Finally, the study did not consider the impact of risk management on the company's financial performance.

Future Research Directions

Future research should focus on the following areas:

Developing a comprehensive risk management framework that includes multiple risk management models.
Conducting a comparative study of different risk management models to determine their effectiveness.
Investigating the impact of risk management on the company's financial performance.
Developing a risk management system that can be implemented in different industries and companies.

Conclusion

In conclusion, this research has shown that the House of Risk model can be an effective tool for managing risk in supply chain systems. The model provides a comprehensive framework for identifying and mitigating potential risks in the supply chain. The study has also highlighted the importance of risk management in supply chain systems and the need for companies to develop effective risk management strategies.

Q: What is the House of Risk (HOR) model?

A: The House of Risk (HOR) model is a comprehensive framework for risk management in supply chain systems. It consists of two main phases: risk identification and risk handling.

Q: What are the two main phases of the HOR model?

A: The two main phases of the HOR model are:

Risk Identification Phase: This phase involves identifying risk events and risk agents that contribute to potential disturbances in the supply chain.
Risk Handling Phase: This phase involves providing advice on risk mitigation action to reduce the impact of identified risks.

Q: What are the benefits of using the HOR model?

A: The benefits of using the HOR model include:

Improved risk management
Enhanced supply chain resilience
Increased operational efficiency
Better customer satisfaction
Greater profits

Q: How can the HOR model be implemented in a company?

A: The HOR model can be implemented in a company by:

Identifying risk events and risk agents
Conducting a comprehensive risk assessment
Developing a risk management plan
Implementing risk mitigation strategies
Monitoring and reviewing the risk management plan

Q: What are the limitations of the HOR model?

A: The limitations of the HOR model include:

It may not be suitable for all types of companies or industries
It may require significant resources and investment to implement
It may not be effective in all situations or scenarios

Q: What are the future research directions for the HOR model?

A: The future research directions for the HOR model include:

Developing a comprehensive risk management framework that includes multiple risk management models
Conducting a comparative study of different risk management models to determine their effectiveness
Investigating the impact of risk management on the company's financial performance
Developing a risk management system that can be implemented in different industries and companies

Q: What are the recommendations for companies to implement the HOR model?

A: The recommendations for companies to implement the HOR model include:

Developing a comprehensive risk management plan
Establishing a risk management team
Providing training and education to employees on risk management and supply chain management
Implementing risk mitigation strategies
Monitoring and reviewing the risk management plan

Q: What are the implications of the HOR model for supply chain management?

A: The implications of the HOR model for supply chain management include:

Improved risk management
Enhanced supply chain resilience
Increased operational efficiency
Better customer satisfaction
Greater profits

Q: What are the future implications of the HOR model?

A: The future implications of the HOR model include:

Increased adoption of the HOR model by companies
Development of new risk management models and frameworks
Improved risk management practices and strategies
Enhanced supply chain resilience and operational efficiency
Greater profits and customer satisfaction