Procurement risk

Abstract

Organisation procurements like any other functional dimensions are not immune to risks. There are a variety of risk factors that arise from external and internal sources that must be rigorously assessed, prevented and/or controlled. Thus, procurement risks management needs to be an integral part of existing procurement and organizational functions so as realise the maximum benefit. The author asserts that procurement risk exists for an organization when supply market behaviour, and the organization‘s dealings with suppliers, create outcomes which harm company reputation, capability, operational integrity and financial viability. The book further provides critical discussions topical-wise on a number of issues relating to procurement and supply risks such as big picture about the synergy between procurement and the risks; risk associated with external dependencies; market conditions and behaviours; procurement process; management controls; approaches on handling the unexpected and the integrated approach towards procurement risk management. Despite the remarkable discussions, the book has some flaws particularly the failure to provide rigorous discussions on the risks manifesting from global supply chains, contract management, and cyber attacks. Also, a meticulous discussion on the risk analysis techniques and tools is missing which could have provided more guidance to practitioners and managers. Even so, the book is very valid and useful to professionals, suppliers, managers, researchers and consultants who are involved with procurement and supply management.