Theme 4: Global Economic Uncertainty

Report on Supply Chain Disruptions

INSTRUCTOR:
Mohammad Sarwar Alam
Assistant Professor
Department of Management
University of Chittagong

Prepared By:
Proma Biswas : BG253071515
Chondrika Dev : BG253071531
BATCH: MBA 26th Batch (BG)
Master of Business Administration (MBA)
Operation & Supply Chain Management (625)

Date of Submission: 2nd March, 2025

CHITTAGONG UNIVERSITY CENTER FOR BUSINESS ADMINISTRATION

Introduction
Supply chain disruption is any event that causes a disruption in the production sale or distribution
of product. Supply chain disruption can include events such as natural disasters, regional conflicts
and pandemics. In recent years the larger part of companies has faced supply chain disruption
which this disruption which this disruption can hamper daily operations and financial as well as
competitive development. These disruptions impact in the economic and social consequences,
prompting businesses and governments to redesign strategies for resilience. This topic survey the
root causes, impacts and actionable solutions to mitigate supply chain vulnerabilities.

Causes of supply chain disruption:

• Natural disasters and climate change:

Disruption caused by natural disasters like floods, earthquakes and hurricanes. Climate changes
and natural disasters can disrupt supply chains in many ways, including damaging production
facilities, transportation and resources supplies. In October 2024, heavy rainfall caused flooding
and landslides in Spain, damaging infrastructure and transportation.

• Geopolitical Tension:

It can significantly disrupt supply chain by creating trade barriers, impacting transportation routes,
price fluctuations and leading to uncertainty in sourcing materials. The invasion of Ukraine during
early 2022 resulted in significant disruptions for supply chains globally. With massive delays and
resources shortage, many companies have found need to redesign their approach to resilience to
not be as affected by future disruptions of similar proportions.

• Labor Shortage:

The covid pandemic has had broad economic implications. One common narrative is that it has
resulted in unprecedented supply chain disrupting and labor shortage. Labor shortage and shortage
of intermediate inputs have been usually prevalent during the pandemic. Between early 2022 and
early 2022, the average fraction of firms that report at least one shortage is more than four times
higher than it is during the preceding two decades. We also observe a significant upward trend
during the pandemic, until the very end of our sample in early 2022. The increase in shortage is
most pronounced for firms in the goods sector, and for intermediate inputs.
 • Technological Failure:

Computer system crashes, network outages, software glitches, and security breaches can disrupt
supply chain. These failures can significantly impact various aspects of supply chain operations,
including order processing, inventory tracking, production scheduling, logistics coordination and
customer delivery.

• Economics Factors:

Currency fluctuations, sudden changes in consumer demand and economics instability can lead to
supply chain disruptions. Rising inflation can increase costs across the supply chain, leading to
price increases for consumers and potential disruptions.

Impacts Of Supply Chain Disruptions:

• Financial Impact:

Financial impact causing by increased costs in production, inventory management, transportation

and potential lost revenue. Due to delayed deliveries or inability to fulfill orders, leading to reduced
profit margin and potentially impacting overall financial stability, especially when disruptions are
large-scale.
• Customer Impact:

Customer can experience impact like delayed deliveries, product shortage, price increase, reduced
product availability, decreased customer satisfaction and potentially a loss of trust of the company
due to inability to fulfill order on time.
• Operational Impact:

Operational impacts of supply chain disruption include: product shipment delays, missed delivery
deadlines, inventory shortage, increased production cost, reduce operational efficiency, difficulty
meeting customer demand, potential damage to brand reputation and unreliable delivery times.

Mitigation Strategies:
• Risk identification and assessment:

Actively identify potential disruptions in your supply chain, whether related to natural disasters,
geopolitical issues, labor disruption asses their potential impact.
 • Inventory Management:
Improving Inventory management during supply chain disruption involves holding safety stock,
increasing visibility through data analytics, collaborating with suppliers, and adapting ordering
strategies to mitigate the impact of potential disruptions, ensuring enough inventory is available to
meet customer demand even when facing supply chain challenges.

• Technology Adoption:

Utilize advance data analytics and real – time tracking systems to monitor supply chain activities
and identify protentional disruptions early on.

Conclusion:
In conclusion, supply chain disruption can significantly impact businesses by causing delays,
increased costs, and lost sales, but companies can mitigate these effects by implementing proactive
strategies like improving inventory management, developing contingency plans and fostering
strong relationship with suppliers to better anticipate. Ultimately, building a more resilient system
is key to weathering unforeseen.

References
Bateh, D. (2024, April 1). Supply chain disruptions and their effect on suppliers and consumers in the
marketplace. p. 2(1): 343.

Loo Saw Khuan, H. K. (2023). Strategies to Mitigate Supply Chain Disruptions. During COVID-19: The Lived
Experience of SC Professionals, pp. Vol. 16, No. 1,.

Pitschner, S. (2022, August 1). SUPPLY CHAIN DISRUPTIONS AND LABOR SHORTAGES:.

Ramsköld, M. (2024, March 3). Supply Chain Disruptions. A case study on the effects the Covid-19
pandemic and the Ukraine conflict has had on sustainability work within supply chains in the
automotive industry.

Umol Syamsyul Rakiman, W. J. (2023, September). Supply Chain Disruptions: . Challenges and Mitigation
Strategies in Manufacturing Companies, p. Vol. 14.