Supply chains are complex, interconnected systems. Traditional linear risk assessments often miss how disruptions propagate through networks. SCIRISK applies network-based risk modeling grounded in the research of Dr. Kamil J. Mizgier to quantify uncertainty and inform strategic decisions.

What Is Supply Chain Risk Modeling?

Supply chain risk modeling is the process of representing a supply network as a mathematical or computational model to:

• Understand risk propagation across suppliers and nodes
  
  

• Estimate potential losses under various scenarios
  
  

• Identify critical points in the network for mitigation
  
  

Mizgier’s research demonstrates that network structure, not just individual supplier performance, drives systemic risk.

Why It Matters

Supply chains face increasing uncertainty due to:

• Globalization and interdependent suppliers
  
  

• Market fluctuations and demand shocks
  
  

• Supplier financial instability or operational disruptions
  
  

Without robust modeling, organizations cannot predict the scale of potential losses or prioritize risk management investments effectively.

Key Components of SCIRISK Supply Chain Risk Modeling

1. Network Representation
   
   

   • Map suppliers, manufacturers, and distribution nodes
     
     

   • Include interdependencies and capacity constraints
     
     

2. Stochastic Simulation
   
   

   • Model uncertainty in supply, demand, and operational parameters
     
     

   • Generate probabilistic loss distributions
     
     

3. Global Sensitivity Analysis
   
   

   • Identify which inputs most influence overall risk
     
     

   • Focus mitigation efforts on high-impact nodes
     
     

4. Scenario Planning
   
   

   • Test extreme but plausible events (e.g., natural disasters, supplier failure)
     
     

   • Evaluate network resilience under stress
     
     

Benefits of Supply Chain Risk Modeling

• Predictive insight: Understand where disruptions will propagate
  
  

• Resource prioritization: Focus investments on high-risk areas
  
  

• Operational resilience: Reduce vulnerability across the network
  
  

• Data-driven decisions: Replace guesswork with quantitative evidence
  
  

Who Should Use It?

• Supply chain planners
  
  

• Risk management teams
  
  

• Procurement managers
  
  

• Finance and operations executives
  
  

Explore Related SCIRISK Frameworks

• Economic Supply Chain Risk Capital (ESCRC) – Convert modeled risk into capital allocation
  
  

• Risk-Based Capital Allocation – Optimize investment under uncertainty