Case Study of the Impact of Risk Management Practices on Supply Chain Efficiency

Abstract

This thesis is done in collaboration with Vestas Wind Systems A/S and its Onshore Procurement department within the Northern and Central Europe region. This research studies the critical relationship between a company’s Project Risk Management practices and Supply Chain Efficiency within context of changing business environment. Efficient Risk Management is crucial for organizations to achieve their goals and objectives. In the context of rapidly changing business environment and the new requirements caused by it, it is important to understand how Risk Management practices can affect the project’s success. The thesis focuses on Supply Chain Risk Management within a global wind turbine manufacturer Vestas’ Northern and Central Europe region, specifically related to the suppliers providing manpower. The company has experienced significant growth within the last few years in this region which has resulted in a great need to adapt to several internal, organizational as well as external changes. In this research the different methods selected by the supply chain management to manage the risks under uncertain circumstances are inspected. A case method approach is used in this paper and as data-collection methods, semi-structured interviews are used to gain information from professionals and experts in the field of Procurement, in addition to observations and data collection from the company’s different databases. The aim of this study is to recognize the key points in the company’s risk management strategy when it comes to managing the supply chain, that have impacted the Project Success in the studied region during this volatile period in the organization. It also identifies the critical success factors such as having a clear objective, enabling efficient stakeholder involvement, and conducting thorough planning prior to the project execution. Additionally, the most common challenges are identified such as risk assessment, reactive management and lacking communication that are faced while managing these construction projects within the dynamic business environment.