As a major international company, Cisco relies on supply chains, collaboration among stakeholders, and globalization as drivers for smooth operations. However, three problems encountered by the corporation can be identified in relation to its risk management. Cisco has experienced risks linked to natural disasters.
Specifically, Japan had suffered from an extensive earthquake and a subsequent tsunami that could impact the supply chain and generate significant economic losses. Needless to say, such phenomena cannot be predicted or avoided. However, planning crisis solutions and determining ways to manage different scenarios help organizations be resilient towards such issues. The Japanese earthquake has created significant challenges for various local and international companies, including Cisco (Son et al., 2021). Hence, natural disasters are one of the problems faced by the organization.
Another challenge is the need to collaborate with fewer suppliers. Cisco relies on the principle of a lean supply chain in a changing market. As a result, the difficulty is reducing the number of suppliers and, as a result, facing more potential risks in case the actors are unable to operate (Rossini et al., 2022). In this case, the barrier is generating efficiency while minimizing the number of parties involved in the processes between the acquisition of raw material and delivery to consumers.
Last but not least, Cisco faces the need to adapt and remain resilient in the face of an ever-changing market. Under the condition that a company relies on globalization and a supply chain, more risks occur, as well as the requirement to consider all potential problems, predictions, and trends. As a result, the issue is to facilitate growth while combating the changes and the dynamic nature of the market. Similar to natural disasters, disruptions and adjustments in the external environment are problems that cannot be prevented but rather planned for through risk management.
References
Rossini, M., Powell, D. J., & Kundu, K. (2022). Lean Supply Chain Management and Industry 4.0: A systematic literature review. International Journal of Lean Six Sigma, 14(2), 253–276.
Son, B.-G., Chae, S., & Kocabasoglu-Hillmer, C. (2021). Catastrophic supply chain disruptions and Supply Network changes: A study of the 2011 Japanese earthquake. International Journal of Operations & Production Management, 41(6), 781–804.