Supply Chain Risk Management Flashcards
7 cards from real Supply Chain and Logistics practice questions. Tap to flip, then mark Knew It or Still Learning — missed cards come back until you master them.
Read the first 7 Supply Chain Risk Management flashcards as text
Which type of supply chain risk arises from a single supplier being the sole source for a critical component?
Answer: Single-source dependency risk
Single-source dependency risk occurs when only one supplier can provide a critical input, leaving the buyer vulnerable if that supplier fails.
A company maps all its suppliers, their suppliers, and beyond to identify hidden vulnerabilities. This practice is called:
Answer: Supply chain mapping (n-tier visibility)
N-tier supply chain mapping extends visibility beyond direct (Tier 1) suppliers to uncover risks embedded deeper in the supply chain.
Which risk mitigation strategy involves holding safety stock to protect against supply disruptions?
Answer: Risk buffering
Risk buffering uses inventory buffers (safety stock) or capacity reserves to absorb supply or demand shocks.
A black swan event in supply chain risk management refers to:
Answer: A rare, high-impact, hard-to-predict disruption
Black swan events are highly improbable, high-consequence disruptions—such as a pandemic or major natural disaster—that are difficult to anticipate.
Which of the following best describes the 'bullwhip effect' as a supply chain risk?
Answer: Demand signal distortion that amplifies order variability upstream
The bullwhip effect is when small fluctuations in end-customer demand get magnified as orders travel upstream, causing excess inventory or shortages.
When a company transfers supply chain risk to an insurer by purchasing cargo or business interruption insurance, this is an example of:
Answer: Risk transfer
Risk transfer shifts the financial burden of a potential loss to a third party (such as an insurer) rather than bearing it internally.
A supply chain resilience strategy that uses multiple geographically dispersed suppliers for the same component is known as:
Answer: Dual/multi-sourcing
Dual or multi-sourcing spreads procurement across several suppliers in different regions, reducing reliance on any one source and geographic concentration risk.