Demand risk: Potential or actual disturbances to flow of product, information, and cash, emanating from within the network, between the focal company and the market, leading to over or under supply

Supply risk: Upstream of focal company equivalent of demand risk

Environmental: Risk associated with external and, from the company's perspective, uncontrollable events. e.g. port blockades, closure due to fire, earthquake, etc.

Internal Drivers

Process risk: Disruptions in the sequences of value-adding and managerial activities undertaken by the company

Control risk: Risk arising from the application or misapplication of controls (i.e. assumptions, rules, systems and procedures that govern how an organization exerts control over the processes) e.g. order quantities, batch sizes, safety stock etc.

Mitigation and contingency: Mitigation is a hedge against risk built into the operations themselves and, therefore, the lack of mitigating tactics is a risk in itself. Contingency is the existence of a prepared plan and the identification of resources that can be mobilized in the event of a risk being identified.

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* Contributed by -
Krishnakanth K. K. & Pankaj Ghai,
PGP Students.
IIM Lucknow.