Which of the following types of risk typically would be most difficult to plan for and mitigate?
Correct Answer: C
Geopolitical risks are among the most difficult to plan for and mitigate due to their complex and unpredictable nature. These risks can include political instability, regulatory changes, trade restrictions, and conflicts. Such events can have widespread and significant impacts on global supply chains, often with little warning and limited ability to influence or control.
* Currency fluctuation (A) can be managed with financial instruments like hedging.
* Forecast error (B) can be mitigated with better data and analytics.
* Supplier performance (D) can be managed through supplier development and contracts.
References
* Christopher, M., & Peck, H. (2004). Building the Resilient Supply Chain. International Journal of Logistics Management.
* Manuj, I., & Mentzer, J. T. (2008). Global Supply Chain Risk Management. Journal of Business Logistics.