Enterprise Risk Management Models
(All human endeavors involve uncertainty and risk. Mitroff and Alpaslan (2003 categorized emergencies and crises into three categories: natural disasters, malicious activities, and systemic failures of human systems.1 Nature does many things to us, disrupting our best-laid plans and undoing much of what humans have constructed. Natural disasters by definition are surprises, causing a great deal of damage and inconvenience. Nature inflicts disasters such as volcanic eruptions, tsunamis, hurricanes and tornados. Guertler and Spinler2 noted a number of supply chain disruptions in recent years due to natural causes. In 2007 an earthquake damaged Toyota’s major supplier for key parts, leading to shutdown of Toyota’s Japanese factories as well as impacting Mitsubishi, Suzuki, and Honda. In 2010 the Icelandic volcanic activity shut down European air space for about a week, massively disrupting global supply chains. In 2011 the tsunami leading to the Fukushima ..disaster disrupted automakers and electronic supply chains, as well as many others.
David L. Olson
Desheng Wu
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