A Strategic Framework for Managing Failure in JIT Supply Chains

Abstract

Supply chains can be disrupted at both local and global levels. Just-In-Time (JIT) companies should be particularly interested in managing supply chain failure risk as they often have very little inventory to buffer themselves when their upstream supply chain fails. We develop previous research further and present a strategic framework to manage supply chain failure in JIT supply chains. We identify two dimensions along which the risks of failure can be categorized: location and unpredictability. We go on to identify strategies which companies can use either before (proactive) or after (reactive) the failure to manage supply chain failure. We support our framework with examples of actual responses to supply chain failures in JIT companies. It is also hoped that our strategic framework will be validated empirically in the future leading to specific guidance for managers.