The Development of a Supply Chain Risk Management Process at Tetra Pak
(2020) MTTM05 20201Engineering Logistics
Department of Industrial Management and Logistics
- Abstract
- Background
Managing risk has become a crucial challenge for supply chain managers. In a complex supply chain, there are relations that have to be managed from the supplier’s supplier to the customer’s customer, and there is a lot of room for unforeseen challenges. The need to capture risk has for a long time been high, but due to the complexity of modern supply chains, uncertain developments are hard to predict. Tetra Pak is the world’s leading food processing and packaging solutions company. The supply chain is large and risks along the supply chain need to be managed.
In 2020, the 2019-20 Coronavirus Pandemic (COVID-19) spread around the world, affecting global supply chains everywhere. During larger disruptions that affect all parts... (More) - Background
Managing risk has become a crucial challenge for supply chain managers. In a complex supply chain, there are relations that have to be managed from the supplier’s supplier to the customer’s customer, and there is a lot of room for unforeseen challenges. The need to capture risk has for a long time been high, but due to the complexity of modern supply chains, uncertain developments are hard to predict. Tetra Pak is the world’s leading food processing and packaging solutions company. The supply chain is large and risks along the supply chain need to be managed.
In 2020, the 2019-20 Coronavirus Pandemic (COVID-19) spread around the world, affecting global supply chains everywhere. During larger disruptions that affect all parts of the world in every part of the supply chain, it is more important than ever to have well-functioning supply chain risk management (SCRM) procedures that successfully manage supply chain risks.
Problem Formulation
The problem that this study wants to address is how one of Tetra Pak’s operation units (Supply Chain Operations) should proactively and reactively manage supply chain risks in a structured way within the entire supply chain.
Purpose
The purpose of this study is to develop a process that manages supply chain risks in Tetra Pak’s operation unit Supply Chain Operations’ supply chain.
Method
A constructive research approach has been applied with the objective to deliver a SCRM process that Supply Chain Operations can work with, by combining theory and practice. A literature review and a multiple case study were conducted in order to get an understanding of the area and provided a foundation for the work at Tetra Pak. The chosen cases were two companies and their work with SCRM to ensure continued business during COVID-19.
Conclusions
The study has contributed to the theory with a SCRM process containing both proactive and reactive steps and procedures to follow in every step. It has also contributed to the knowledge of how companies’ SCRM procedures have helped them handle their supply chain issues during COVID-19. Furthermore, Tetra Pak is recommended to conduct the created SCRM process and the procedures within every step. (Less) - Popular Abstract
- Don’t let a pandemic stand in the way of your supply chain
A case study of supply chain risk management processes during normal circumstances and during the outbreak of COVID-19.
By Allis Albèr and Marcus Skog for the Division of Engineering Logistics
On 11 March 2020, WHO declared COVID-19 as a pandemic. Entire countries have forcibly restricted the personal movements, public events, and business activities of its people. The disease presents a very high risk to both human life, but also the economic well-being across the planet, and as long as human interaction is assessed as dangerous, the business cannot return to normal. Companies with large global supply chains face large issues in securing their operations, and already in... (More) - Don’t let a pandemic stand in the way of your supply chain
A case study of supply chain risk management processes during normal circumstances and during the outbreak of COVID-19.
By Allis Albèr and Marcus Skog for the Division of Engineering Logistics
On 11 March 2020, WHO declared COVID-19 as a pandemic. Entire countries have forcibly restricted the personal movements, public events, and business activities of its people. The disease presents a very high risk to both human life, but also the economic well-being across the planet, and as long as human interaction is assessed as dangerous, the business cannot return to normal. Companies with large global supply chains face large issues in securing their operations, and already in February, 94% of the Fortune 1000 companies saw supply chain disruptions from COVID-19. With a clear defined process on how to manage supply chain risks in the entire supply chain, even a pandemic can be handled successfully.
What we suggest is a well-structured supply chain risk management process that tackles risks both proactively as well as reactively. Risks that originate from within the supply chain can usually be mitigated with different strategies, for example having more than one supplier for a certain product. However, risks that originate from outside the supply chain, for example, earthquakes, political decisions, and pandemics, are tricky to prevent. For those risks, the company has to be ready to work reactively instead.
We have been investigating and comparing Tetra Pak’s and Ericsson’s supply chain risk management before and during the outbreak of COVID-19 in a case study. Combined with a literature review, we have developed a supply chain risk management process developed especially for Tetra Pak, which was the purpose of the study. The process includes six different steps that are all crucial for a process meant to manage supply chain risks. The process we recommend for Tetra Pak can be suitable for other companies as well, adjusted to different needs.
The steps are: risk identification, risk assessment, risk mitigation, risk monitoring, business continuity planning, and lastly, business continuity activation. The first four steps are together the proactive supply chain risk management process. Those aim to mitigate risks before the risk event has occurred. The last two steps are connected to the reactive supply chain risk management process. Business continuity planning prepares for what to do when something happens, and business continuity activation is the actions to deploy after the event has occurred. Further suggestions that should be taken into account when working with the six steps are (1) to work cross-functional, both intra- and inter-organizationally, and (2) to combine the process with a sophisticated information system that will simplify the analyzes, documentations, and assessments, and to more easily be able to work cross-functionally.
To summarize, it is of great importance to manage supply chain risks so that disruptions, such as COVID-19, can be handled in the best possible way and the supply chain can still be able to deliver results as during a stable environment. And for some risks, taking care of them before anything happens is even better.
The full study is published in the report “The Development of a Supply Chain Risk Management Process at Tetra Pak”. (Less)
Please use this url to cite or link to this publication:
http://lup.lub.lu.se/student-papers/record/9017106
- author
- Albér, Allis LU and Skog, Marcus LU
- supervisor
- organization
- course
- MTTM05 20201
- year
- 2020
- type
- H2 - Master's Degree (Two Years)
- subject
- keywords
- Supply chain risk management (SCRM), SCRM process, Risk identification, Risk assessment, Risk mitigation, Risk monitoring, Business continuity planning, Incident handling, COVID-19
- report number
- 5917
- language
- English
- id
- 9017106
- date added to LUP
- 2020-06-17 13:29:50
- date last changed
- 2020-06-17 13:29:50
@misc{9017106,
abstract = {{Background
Managing risk has become a crucial challenge for supply chain managers. In a complex supply chain, there are relations that have to be managed from the supplier’s supplier to the customer’s customer, and there is a lot of room for unforeseen challenges. The need to capture risk has for a long time been high, but due to the complexity of modern supply chains, uncertain developments are hard to predict. Tetra Pak is the world’s leading food processing and packaging solutions company. The supply chain is large and risks along the supply chain need to be managed.
In 2020, the 2019-20 Coronavirus Pandemic (COVID-19) spread around the world, affecting global supply chains everywhere. During larger disruptions that affect all parts of the world in every part of the supply chain, it is more important than ever to have well-functioning supply chain risk management (SCRM) procedures that successfully manage supply chain risks.
Problem Formulation
The problem that this study wants to address is how one of Tetra Pak’s operation units (Supply Chain Operations) should proactively and reactively manage supply chain risks in a structured way within the entire supply chain.
Purpose
The purpose of this study is to develop a process that manages supply chain risks in Tetra Pak’s operation unit Supply Chain Operations’ supply chain.
Method
A constructive research approach has been applied with the objective to deliver a SCRM process that Supply Chain Operations can work with, by combining theory and practice. A literature review and a multiple case study were conducted in order to get an understanding of the area and provided a foundation for the work at Tetra Pak. The chosen cases were two companies and their work with SCRM to ensure continued business during COVID-19.
Conclusions
The study has contributed to the theory with a SCRM process containing both proactive and reactive steps and procedures to follow in every step. It has also contributed to the knowledge of how companies’ SCRM procedures have helped them handle their supply chain issues during COVID-19. Furthermore, Tetra Pak is recommended to conduct the created SCRM process and the procedures within every step.}},
author = {{Albér, Allis and Skog, Marcus}},
language = {{eng}},
note = {{Student Paper}},
title = {{The Development of a Supply Chain Risk Management Process at Tetra Pak}},
year = {{2020}},
}