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Abstract

Supply chains have extended their global reach at a time when there is less room for error when making deliveries to customers. As a result, supply networks are extremely vulnerable to damaging disruptions. A way to reduce the likelihood of service interruptions is to introduce a risk management (RM) strategy. The MIT Center for Transportation & Logistics has launched the Global Risk Management Research Project to help companies implement more effective RM programs. The research project has looked at the RM tools companies are using, and identified the impediments to managing risk, such as a general perception that RM strategies incur cost without a clear return. The project has also highlighted possible solutions, including the deployment of sensors to notify organizations of potential disruptions. The second phase of the project is scheduled to start in late 2008, and will focus on quantitative assessments of risk.