Easy
A 9.0-magnitude earthquake in Japan.
What natural disaster impacted Nissan’s production facilities in March 2011?
To rank nodes in the supply chain based on their potential impact if disrupted.
What is the purpose of the Risk Exposure Index (REI)?
React to supply issues by adjusting production and sourcing.
What does a flexible supply chain allow companies to do in response to disruptions?
It shut down 17 of its manufacturing facilities worldwide.
What did the CPG company do to reduce costs by $40M per year?
The longest time a supply chain can operate without a specific node.
What does Time-to-Survive (TTS) represent in risk management?
Risks that can be quantified but are not fully controllable.
What are known-unknown risks in supply chain management?
It helps respond to unforeseen events without significantly increasing costs.
What is a key benefit of building capacity redundancy in supply chains?
Nokia sourced components from alternate suppliers within five days.
How did Nokia respond to the Philips fire in Albuquerque, NM, in 2000?
It may be forced to exit specific markets due to supply chain failures.
What is a company likely to face if it fails to sense and respond to supply chain changes?
They distributed blueprints to other suppliers and adapted machinery to continue production.
How did Toyota recover after the fire disrupted their sole supplier of P-valves in 1997?
61% of Ford’s supplier sites had no impact on profits when disrupted.
What did the Risk Exposure Method reveal about Ford’s supply chain after analysis?
An explosion at Evonik’s plant in Germany.
What high-impact, low-probability event disrupted Evonik’s supply of nylon 12 to Ford in 2012?
Time-to-Recover.
What does TTR stand for in supply chain risk management?
It can lead to significant losses if the expected scenario does not occur.
What is the downside of a speculative strategy in supply chain management?
There are multiple strategies close to the optimal cost that are more effective for risk mitigation.
What does the flat total cost function in supply chains imply?
Dual sourcing, inventory management, and risk-sharing contracts.
What are some key strategies for mitigating known-unknown risks?
By using the Risk Exposure framework to anticipate bottlenecks.
How did Ford mitigate the disruption caused by the shortage of nylon 12?
Dual sourcing and redesigning new products.
What did Ford implement to mitigate high financial impact risks?
Through capacity redundancy and speed in sensing and responding.
How do companies manage unknown-unknown risks?
It makes the supply chain highly vulnerable if the sole supplier is disrupted.
What is the primary risk associated with single sourcing in supply chains?
Natural disasters, geopolitical risks, epidemics, and port delays.
What are some risks unique to global supply chains?
Currency fluctuations.
What is a key market risk mentioned that can disrupt supply chains?
It took four weeks for the news to reach upper management, leading to significant losses.
What mistake did Ericsson make in its response to the Philips fire?
Offsetting losses in one part of the supply chain with gains in another.
What is a hedge strategy in supply chain risk management?
Approximately 2% of supplier sites, though small in purchases, could cause very high financial impact if disrupted.
What did Ford's multitier supplier network analysis reveal about supplier sites?