What Is Supply Chain Risk Management?

Supply chain risk management (SCRM) is the process of taking strategic steps to identify, assess and mitigate the risk in your end-to-end supply chain.

A comprehensive approach to SCRM involves the management of all types of risk, for all tiers of supply and for all risk objects (suppliers, locations, ports and more). When done well, SCRM is a critical enabler that is embedded and integrated into the core processes of an enterprise.

The Supply Chain Risk Management Lifecycle

Identify, Assess, Mitigate
Identifying risks with a magnifier

Risk Identification

The only way to address risk is to make sure you’re identifying it in the first place. The first phase of the risk management lifecycle is to establish a risk profile and then enact active monitoring to keep it up to date.

Overviewing risks with a checklist

Risk Assessment

Understand what impact a risk event could have on your business. Be aware of those partners who have a significant impact on sales, margins or profit.

Mitigating risks with a shield

Risk Mitigation

Define both preventive action plans and reactive action plans. These are what provide the basis for addressing risk using appropriate measures to secure supply and protect brand.

Gain a Total View of Risk

SCRM is increasing in Importance

Just in Time / Just in Sequence

Running a lean supply chain means you have less wiggle room when things go wrong.


Outsourcing and supply chain length and complexity are growing. This leaves you open to more risk.

Brand Reputation

With more regulations and the increasing influence of social media, it’s critical to address issues that could harm your brand image.

Increasing Threats

More storms. More political strife. More cyber events. Threats are increasing, and so is your risk.

SCRM Is An Enterprise Value Driver

Business Continuity

Stay up and running during a risk event.

Supply Chain Visibility

Increase visibility with a view of risk.

CSR and Compliance

Monitor regulatory/standards compliance throughout your supply chain.

Supplier Relationship Management

Manage suppliers to realize value and reduce risk.

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