Managing Risk to Avoid Supply-Chain Breakdown

1. Distortion increases in the supply chain as you get farther away from the end consumer, known as the ___ effect.
4. For products with high holding costs and/or a high rate of obsolescence, using ___ suppliers is a better strategy.
6. This company lost over $400 million in sales because they employed a single sourcing policy and there was a fire at their only supplier.
8. Intellectual property risk has grown rapidly as supply chains become less...
10. A group exercise that helps managers and their companies understand and prioritize supply chain risks.
12. Managers can lower excess risks by making existing capacity more...
14. Sears stock plummeted more than 30% in one day because of this type of risk.
15. Holding inventory is appropriate for __ products with relatively low holding costs.

2. This type of risk refers to unanticipated increases in acquisition costs resulting from fluctuating exchange rates or supplier price hikes.
3. Results from a mismatch between a company's projections and actual demand.
5. The more a company networks its ___, the greater the threat that a failure anywhere can cause failure everywhere.
7. If the level of risk is high, managers need to focus on this.
9. This can be countered by creating financial hedges, balancing cost and revenue flows by region and building flexible global capacity.
11. Natural disasters lead to this type of risk.
13. This occurs when a supplier, through high utilization or another cause of inflexibility, cannot respond to changes in demand.