Title: Amplifiers of Supply Chain Disruptions: A Managerial Framework for Reducing the Impact of Disruption to the Supply Chain | SCM | Supply Chain Resource Cooperative (SCRC) | North Carolina State UniversitySupply Chain Resource Cooperative | NC State University
Headings: Amplifiers of Supply Chain Disruptions: A Managerial Framework for Reducing the Impact of Disruption to the Supply Chain
Amplifiers of Supply Chain Disruptions: A Managerial Framework for Reducing the Impact of Disruption to the Supply Chain
Amplifiers of Supply Chain Disruptions
The extent to which a firm relies on global sources of supply
The complexity of the product or process
Table 1 – Global Sourcing Amplifiers of Disruption
Table 2 – Product / Process Complexity Amplifiers of Disruption

Content: All of the disruption amplifiers fell into one of two categories: 1) the extent to which a firm relies on global sources of supply, and 2) the complexity of the product or process. The extent to which a firm relies on global sources of supply
Supply Chain Globalization: The number of leverage points and the lead-time associated with ordering and receiving products from low cost countries will amplify the potential impact of the disruption. The growth in low cost country sourcing from places such as China, India, Eastern Europe, and Malaysia is skyrocketing. During Wall Street’s last round of quarterly earnings announcements, few large companies got very far into their conference calls with analysts before the subject of China came up. Companies such as General Motors, General Electric, Goldman Sachs, Home Depot, and even Avon have Chinese expansion plans and global sourcing plans at the top of their to-do list. Although the decision to source in areas such as China is often based on the anticipation of lower costs, these decisions often overlook the potential amplification of risk that occurs when these global sourcing channels are developed. Specifically, leverage points, or points in the chain where subsequent flows of product are present, are the catalysts for a “domino” factor to occur. As shown in Table 1, a number of different elements are driving globalization, which are also contributing to increasing disruption responses time and recovery time.