Risk Management in Purchasing and Supply Management


Purchasing departments use various strategies and techniques to minimise the impact of detrimental events occurring in the supply chain. This concept has been created to assist managers with risk management. It presents main attributes and some examples of risk management through proactive purchasing activities.

Technique Overview

Risk Management in Purchasing and Supply Management Definition

Generally, risk can be defined as ‘the probability of an unwanted outcome happening’. Risk management involves three key activities: risk analysis, risk assessment and risk mitigation (CIPS: Risk Management in Purchasing and Supply Management).

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Business Evidence

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Business Application

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Professional Tools

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Further Reading

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Risk Management in Purchasing and Supply Management References (4 of up to 20) *

  • Chopra, S. and Sodhi, M.S. (2004) Managing Risk to Avoid Supply-chain Breakdown. MIT Sloan Management Review, Vol. 46(1), pp. 53-61.
  • CIPS: Risk Management in Purchasing and Supply Management.
  • Cousins, P.D., Lamming, R.C., and Bowen, F. (2004) The Role of Risk in Environment-related Supplier Initiatives. International Journal of Operations and Production Management, Vol. 24(6), pp. 554-565.
  • Ellis, S.C., Henry, R.M. and Shockley, J. (2010) Buyer Perceptions of Supply Disruption Risk: A Behavioural View and Empirical Assessment. Journal of Operations Management, Vol. 28(1), pp. 34-46.

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