Logistics and Supply Chain Management

This document discusses the concepts of strategic supply chain management and strategic risk management in the context of logistics and supply chain management. It explores how strategic supply chain management influences the financial and non-financial performance of an organization, and how strategic risk management helps in addressing supply chain disruptions.

Running head: LOGISTICS AND SUPPLY CHAIN MANAGEMENT
Logistics and Supply chain management
Name of the Student:
Name of the University:
Author Note:

1LOGISTICS AND SUPPLY CHAIN MANAGEMENT
Answer 1
Strategic supply chain management refers to the strategy or planning for the supply chain
of the organization to function within its environment for meeting the goals and objective of the
organization (Christopher, 2016). A supply chain management is the network of delivering the
right goods and services to the customers when they need or want those and the strategic SCM
covers the segments like product development, manufacturing, customers, logistics and vendors
(Hugos, 2018). Thus, it can be inferred that supply chain management in an organization has
significant role in influencing the financial and non-financial performance within the
organization.
As stated by Kaplan & Atkinson (2015), financial activities or performance of a company
involves all types of financial and monetary activities, such as, buying and selling of goods or
assets, organizing and managing the accounts, issuing or floating shares, or other business
activities with particular monetary objectives,. On the other hand, non-financial activities or
performance includes achieving customer satisfaction, human resource development, community
development and sustainability and production quality (Gitman, Juchau & Flanagan, 2015).
Wahdan & Emam (2017) stated that SCM has a direct impact on the financial
performance of an organisation as SCM focuses on delivering the product demanded by the
customers and thus affects the net income of the company. Strategic SCM enables the
organization to optimize its productivity and decreasing the cost for achieving profit
maximization. At the same time, as stated by Fredendall & Hill (2016), strategic SCM also
affects some of the balance sheet activities, such as, inventory holding costs, forecasting,
exchange rate changes, payment related activities etc. through its product manufacturing and

2LOGISTICS AND SUPPLY CHAIN MANAGEMENT
distributing networks. Similarly, Mangan, Lalwani & Lalwani (2016) highlighted that strategic
SCM also focuses on the improvement of product quality and enhancing the skills and
productivity of the employees and manufacturing unit, which in turn helps to achieve a greater
level of customer satisfaction. Along with the product quality, the timely delivery, after sales
customer service, warrantee service and cost etc. are also significant non-financial activities of a
company, which are controlled by the strategic supply chain management. As the overall
business performance of a company depends on both the financial and non-financial
performances, thus, according to Ralston et al. (2015), strategic supply chain is an effective way
to integrate both the financial and non-financial performances in the optimum manner.
Answer 2
Strategic risk management refers to the process of identifying, evaluating, and managing
the risk factors in the business strategies of an organization and taking immediate and swift
actions as an when the risks are realized (Bromiley, Rau & McShane, 2016). The strategic risk
management involves the forecasting of how the wide range of potential events can affect the
business strategy and its functioning and ultimately affect the value delivered by the company.
Thus, according to Calandro (2015), risks are some major elements of business that can affect
the business operations and through effective strategic risk management, the companies can have
contingency planning to mitigate the impact of the risks.
Scheibe & Blackhurst (2018) addressed supply chain disruption as a risk factor for any
business. Supply chain disruptions can happen due to multiple internal and external factors or

3LOGISTICS AND SUPPLY CHAIN MANAGEMENT
events and it is a major risk for any company. Thus, access to real-time visibility to the supply
chain has become essential for the companies as a part of their strategic risk management. As
highlighted by Sawik (2017), some of the supply strategies are quite complex in nature and the
management has to take decisions accordingly to reduce the disruption risk. For example, even if
multiple alternative options of supply sources exist, yet as per the strategic risk management, the
firm might need to choose a single supply source to reduce the risk of supply chain disruption.
Kamalahmadi & Parast (2017) stated two types of risk that affect the supply chain design and the
management as well, that is, the risks originating from the supply and demand coordination and
risks originating from the disruptions of the normal business activities. Supply chain disruption
falls under the second category of risks.
Giannakis & Papadopoulos (2016) illustrated the sustainability issue of the supply chain,
which can be termed as a strategic risk management process. Through sustainability practices,
the effect of the risk of supply chain disruption can be mitigated. Thus, as said by Wakolbinger
& Cruz (2011), strategic risk management enables the companies to forecast about the supply
chain disruptions by evaluating the options, such as, disruption velocity, persistence, and
response readiness of the company, which in turn helps in assessing the immediate effect to the
supply outage as well as financial impact and make appropriate contingency planning
beforehand. Hence, strategic risk management process is helpful in addressing the supply chain
disruptions.

4LOGISTICS AND SUPPLY CHAIN MANAGEMENT
References
Bromiley, P., Rau, D., & McShane, M. K. (2016). Can strategic risk management contribute to
enterprise risk management? A strategic management perspective. A Strategic
Management Perspective (October 20, 2014). Forthcoming: Bromiley, P., Rau, D., and
Mcshane, M, 140-156.
Calandro, J. (2015). A leader’s guide to strategic risk management. Strategy & leadership, 43(1),
26-35.
Christopher, M. (2016). Logistics & supply chain management. Pearson UK.
Fredendall, L. D., & Hill, E. (2016). Basics of supply chain management. CRC Press.
Giannakis, M., & Papadopoulos, T. (2016). Supply chain sustainability: A risk management
approach. International Journal of Production Economics, 171, 455-470.
Gitman, L. J., Juchau, R., & Flanagan, J. (2015). Principles of managerial finance. Pearson
Higher Education AU.
Hugos, M. H. (2018). Essentials of supply chain management. John Wiley & Sons.
Kamalahmadi, M., & Parast, M. M. (2017). An assessment of supply chain disruption mitigation
strategies. International Journal of Production Economics, 184, 210-230.
Kaplan, R. S., & Atkinson, A. A. (2015). Advanced management accounting. PHI Learning.
Mangan, J., Lalwani, C., & Lalwani, C. L. (2016). Global logistics and supply chain
management. John Wiley & Sons.

5LOGISTICS AND SUPPLY CHAIN MANAGEMENT
Ralston, P. M., Blackhurst, J., Cantor, D. E., & Crum, M. R. (2015). A structure–conduct–
performance perspective of how strategic supply chain integration affects firm
performance. Journal of Supply Chain Management, 51(2), 47-64.
Sawik, T. (2017). A portfolio approach to supply chain disruption management. International
Journal of Production Research, 55(7), 1970-1991.
Scheibe, K. P., & Blackhurst, J. (2018). Supply chain disruption propagation: a systemic risk and
normal accident theory perspective. International Journal of Production Research, 56(1-
2), 43-59.
Wahdan, M. A., & Emam, M. A. (2017). The Impact of Supply Chain Management on Financial
Performance and Responsibility Accounting Agribusiness Case from Egypt. Accounting
and Finance Research, 6(2), 136.
Wakolbinger, T., & Cruz, J. M. (2011). Supply chain disruption risk management through
strategic information acquisition and sharing and risk-sharing contracts. International
Journal of Production Research, 49(13), 4063-4084.