A Study Of Supply Chain Crisis Forewarning System Based On Supply Chain Management

With the rapid development of network information technology, the process of global economic integration accelerating and driven by a strong knowledge-based economy, the original competition between individual enterprise and individual enterprise transformed into enterprises'supply chains'competition, and the enterprise supply chain management faces a brand-new challenge. The complicated structure and the global extension of the supply chain have exacerbated the chain instability, not only the supply chain faces more and more risks, but also the supply chain crisis break out repeatedly. All above make the supply chain crisis forewarning management become an extremely important subject. So enterprises must realize that it is very important to adopt the forewarning management of supply chain crisis, do a good job of warning and preventing the crisis in advance, and then take effective measures to avoid that. This paper makes research on the supply chain forewarning system under such a background.During the process of supply chain's stable operation, some uncertain incidents seriously affect the stability of supply chain and even cause the disintegration of the supply chain system, which could cause the huge loss and damage of products, services, capital and reputation of the whole supply chain, when breaks out the supply chain crisis. Supply chain forewarning requests enterprises to use the combining methods of both quantitative and qualitative method. Firstly, we should collect and sort out all kinds of information or signal which reflect crisis, and keep a continuous monitoring on the major crisis causes and crisis signs. Secondly, based on the large number of crisis information monitored being effectively sorted out and analyzed, we could make the estimation of the crisis form which possibly occurs in the future and its damage degree. Finally, the enterprise and enterprises with benefits correlation have to be sent the alarm to of the potential crisis which would cause great damage. 1. Analyzing the Supply Chain Crisis Factors.Because of the different causes, we can divide crisis into external crisis and endogenous crisis. Similarly, the supply chain crisis factors mainly include external environment factors and internal risk factors.(1) The external environment factors of supply chainThe external environment factors of supply chain include natural disaster, economic environment, marketing factor, legal policy, etc. These factors are irresistible to some extent, and they could not be controlled by enterprises. While enterprises may take precaution or avoiding measures ahead of time to reduce loss as they can.(2) The internal risk factors of supply chainThe internal risk factors of supply chain can be controlled by the enterprise managers, and are the focal point of this research either. They mainly come from the relationship between the various sectors of the supply chain system or the supply chain system itself, and can lead to an internal crisis in the supply chain. Overall they include risk factors both in supply chain internal management and the whole supply chain.The risk factors in supply chain internal management refer to the risk that appears in the production process of the supply chain enterprise, which are consist of the management decision-making risk, the management control risk, the logistic operation risk and the human resources risk.The supply chain is composed of a series of enterprises which are in restraint of incomplete contracts, and this structure has determined the uncertainty of the whole supply chain. The uncertainty is the risk factor in the whole supply chain, which affects operations of the whole supply chain, and it mainly includes the benefit contradiction, supplied chain trust crisis, the cooperative partner risk, information risk, technological risk and fund operating risk, etc. 2. Designing and Evaluating of the Supply Chain Crisis Forewarning Index SystemIn order to take precautions against it and pre-control it before the supply chain crisis taking place, enterprises need to establish a set of the index system of the supply chain crisis forewarning. The index system of the crisis forewarning is the base of establishing crisis forewarning system. Through monitoring the supply chain crisis source to find the crisis sign, the index system sends out alarms to enterprises in time when the crisis coming, and provide enterprises with a basis for decision-making.The pre-control of strongly operational internal risk factors is the focus of this research. Establishing the index system based on the principles of systematic, comprehensive, continuous, stably, both financial and non-financial index, both quantitative and qualitative index, this paper refers to the index system of the supply chain crisis forewarning which is established by Yanhua Liang and the research on the index system of the competitiveness of the supply chain evaluation by Xiaofeng Shao, and divided the index system of the supply chain crisis forewarning into six aspects: the agility, the flexibility, the customer guidance, the operation ability, profitability and the cooperation level.After the establishment of forewarning index system, multilevel fuzzy comprehensive evaluation method is used to evaluate the crisis in the supply chain. By means of the primary and secondary fuzzy comprehensive evaluation, we get the evaluation results of synthesized supply chain crisis and all of the primary indices, which are B and Bi ,i = 1,2,…, 6.The evaluation decision can be made based on B and Bi according to the principle of maximum degree of membership. The synthesized supply chain crisis degree should be determined, and if there are some problems, the enterprise has to further analyze the source of supply chain crisis factors. In the similar way, all of the specific primary indices'crisis degree could be determined, and then the enterprise can strengthen its management objectively to take precautions against crisis.At last, assigning the values for the V evaluation set, so that the final evaluation score of the synthesized supply chain crisis could be calculated. According to the final evaluation score, we can compare the crisis degree of the different enterprises in the same supply chain or the different supply chains. Then the enterprise could evaluate their own advantages and shortcomings in the industry or the greater range, and make effective decisions to keep the supply chain crisis away.3. Construction and Operation of Supply Chain Forewarning SystemSupply chain forewarning system is composed of information processing subsystem, decision subsystem and alarm subsystem. It follows the principle of preventive, systematic, dynamic, index, institutionalization, and actualize the monitoring, diagnosing and correcting functions.The operation procedures of the supply chain crisis forewarning system are as follows,Collecting a large number of monitoring information and then process them;Carrying on recognition analysis and risk assessment analysis of the crisis on the data;Making judgments and decisions on the results of the evaluation;Once enterprises get in the crisis condition, send an alarm and start crisis control.The above-mentioned process has formed the supply chain crisis forewarning system operation circulation. After accumulating experience enterprises can create a stable and efficient supply chain crisis forewarning system.Finally, a good operation of the supply chain crisis forewarning system needs the crisis forewarning management organization and the crisis forewarning system as a guarantee. Information gathering, information analysis, forewarning signal systems and forewarning center should mutually support and cooperate with each other. In addition, enterprises should establish supply chain crisis forewarning mechanisms and give full play to the crisis forewarning staff's unique role in the prevention of crisis. At the same time enterprise managers should maintain a high degree of sense of crisis, and reinforce the education of staff's crisis sense and a proactive approach to crisis management forewarning so that the whole enterprise make sense of crisis. All above can help prevent crisis before they do business.