A LITERATURE REVIEW OF SUPPLY CHAIN RISK MANAGEMENT IN AUTOMOTIVE INDUSTRY

Abstract

Supply chain risk management (SCRM) has a strong influence on the cooperation among partners and the performance of the entire production chain across the world. A supply chain designed to minimize risks enables firms to establish a competitive position and provides long-term benefits to stakeholders. Especially in a complicated and slow-growing industry like Automotive Industry. The auto industry's most important segments including commercial vehicles and passenger cars. Global sales of passenger cars are forecast to fall to 59.5 million units in 2020, down from a peak of 79.6 in 2017. The SCRM system should be structured to manage both routine and extraordinary risks, such as economical crisis, global pandemic issues, or even other unexpected event. The risks should be managed both reactively, by monitoring changes in the chain, the needs of customers, technology and the strategies of suppliers and competitors, among others, to enable quick reaction to events; and proactively, to identify risks and implement actions to prevent them or minimize their impacts. The basic risk management process consists of identifying, evaluating, mitigating and controlling risks. The objective of this paper is to analyze how SCRM could manages the risk factors in Automotive Industry’s supply chain in three different segmentation perspective. To achieve this aim, we performed a qualitative, applied and exploratory field study of the development trend of automotive Industry across the world, Asia, and Indonesia in terms of gaining more insight about the latest development trend of SCRM implementation in various segmentation. The data were collected by doing literature review from previous published research related to SCRM in Automotive Industry.