What Is a Supply Chain Risk Management Framework?

Article Highlights:

• Supply chain risk management refers to the collection of measures, processes, and broader strategies businesses develop and enact in order to address, assess, and mitigate risks in their supply chains. 
• The overarching objective of all SCRM programs is to minimize supply chain risks, reduce the cost and severity of disruptions, and maintain as much manufacturing continuity as possible.
• Different businesses have different supply chain threats, and one of the first steps in establishing a framework is to identify the risks that are the most relevant to your organization and the supplier network it sources from.
• The enhanced supply chain visibility created by an effective SCRM framework is a major asset to businesses in 2026, giving them the data and insights critical to transparency, ESG performance, and other modern success metrics. 

The 2020s have seen a succession of historic disruptions strike global supply chains, from the COVID-19 pandemic to a semiconductor shortage to the flurry of tariffs implemented by the Trump administration in 2025. Businesses that rely on complex manufacturing networks know that events like these can have significant ripple effects, reverberating across costs, lead times, and production continuity. 

For original equipment manufacturers (OEMs) and other organizations that source from large supply chains, having the internal processes and professional expertise to manage those risks can make a crucial difference. The key discipline for addressing and mitigating the kinds of supply chain threats that have bedeviled manufacturers this decade is supply chain risk management (SCRM). And the most effective strategy for establishing a robust SCRM program is developing and implementing a supply chain risk management framework.

What Is Supply Chain Risk Management?

Supply chain risk management refers to the collection of measures, processes, and broader strategies businesses develop and enact in order to address, assess, and mitigate risks in their supply chains. The overarching objective of all SCRM programs is to minimize supply chain risks, reduce the cost and severity of disruptions, and maintain as much manufacturing continuity as possible. The Association for Supply Chain Management, an educational nonprofit for supply chain professionals, defines SCRM as the “systematic identification, assessment, and mitigation of potential supply chain disruptions with the objective of reducing their negative impacts on the supply chain’s performance.”

SCRM is a large, multifaceted field, and can encompass both proactive and reactive measures, different levels of technological sophistication, and a wide range of risk types. Professionals whose work touches supply chain risk management include those in the following areas:

• Supply chain risk
• Supply chain resilience
• Supply chain intelligence
• Compliance
• Strategic sourcing
• Procurement

What Is a Supply Chain Risk Management Framework?

While the goals of SCRM are relatively straightforward, businesses and their employees need to have a common understanding of how their organization can arrive at those objectives. That’s where an SCRM framework comes in. 

A business framework is a structured approach that organizations and their employees can use to analyze challenges—as well as other facets of their operations—and develop strategies for effectively addressing them. Business frameworks are valuable because they establish a universal language for how to execute relevant responsibilities, and what constitutes success. In addition, frameworks foster independence and initiative among employees, as individuals are able to lean on an underlying structure instead of relying on direct supervisors for ongoing guidance and direction. 

Given those parameters, a supply chain risk management framework can be understood as a structure professionals, teams, and organizations can draw on to:

• Assess risks in their supply chains
• Conceptualize risk management strategies
• Implement measures to mitigate those risks over time. 

Key Aspects of an Effective SCRM Framework

An SCRM framework might look something like this:

Identify Relevant Supply Chain Risks

Different businesses have different supply chain threats, and one of the first steps in establishing a framework is to identify the risks that are the most relevant to your organization and the supplier network it sources from. An electronics manufacturer operating in the European Union, for example, might zero in on environmental compliance and tariff impact as tier-one risks, while a U.S. business that sources heavily from China and the Asia Pacific region may prioritize geopolitical risk, single-source dependencies, and ESG performance as the chief threats to their manufacturing continuity. 

Conceptualize and Develop Risk Mitigation Strategies

It likely goes without saying that identifying critical supply chain vulnerabilities is not sufficient—organizations must then work to develop plans and processes for addressing those risks. Because SCRM has been around for decades, and has matured in terms of nuance and sophistication in recent years, there’s now a deep repository of strategies professionals can pull from to mitigate the threats most pertinent to their supplier network. These include—but are not limited to—the following actions:

• Supply chain diversification
• Multisourcing or dual sourcing
• De-risking
• Supplier communication and collaboration
• Contingency planning
• Sub-tier risk analysis
• Modifications to suppliers and sourcing
• Onshoring, nearshoring, and friendshoring
• Product redesign

Implement and Measure Performance

Businesses must also do the real-world work of mapping those strategies onto their supply chains. This often requires reaching out to direct and sub-tier suppliers, identifying and assessing alternative sourcing opportunities, and codifying crisis response processes for when disruptions occur. 

Finally, it’s not enough to simply implement SCRM measures and hope they make a difference. High-level risk management demands accountability and performance analysis. Organizations should establish key performance metrics and other objective measurements for success. And because supply chain risks are constantly evolving, risk management strategies must be correspondingly fluid, and capable of maturing to meet emerging and evolving vulnerabilities. 

Primary Benefits of a Supply Chain Risk Management Framework

An SCRM framework can be advantageous to original equipment manufacturers (OEMs) in a raft of different ways. Each of these benefits ties back to supply chain resilience, an increasingly popular term that refers to a company’s ability to weather risks, disruptions, and other unforeseen events without compromising production or performance. 

Supply Chain Continuity

The chief objective of SCRM is to preserve supply chain continuity, ensuring that parts and products are manufactured and delivered without interruption. The more effectively companies are able to minimize disruptions, the higher their margins will be. Further, more sustained production continuity gives team members in sourcing, procurement, and even engineering increased bandwidth to work on ways to grow the company in a positive direction, rather than just treading water in the face of costly upheaval. 

An SCRM framework can be advantageous to original equipment manufacturers (OEMs) in a raft of different ways. Each of these benefits ties back to supply chain resilience, an increasingly popular term that refers to a company’s ability to weather risks, disruptions, and other unforeseen events without compromising production or performance. 

Regulatory Compliance

As any compliance professional can attest, the global regulatory landscape is growing at a steady rate. Whether it’s ESG regulations rolled out by the European Union, PFAS restrictions implemented at local and regional levels, or trade restrictions imposed by federal governments, companies must now navigate a dense terrain of directives, sanctions, and legal controls. A SCRM framework can not only help businesses understand their compliance obligations, but can also shed light on the regulatory vulnerabilities lurking in their supply chains.  

Superior Supply Chain Visibility

In the process of identifying supply chain risks, developing mitigation strategies, and implementing remedial measures, organizations will broaden and deepen their supply chain visibility. This could mean expanding their view of direct suppliers and their manufacturing sites, or probing into their subtiers to delineate tier-two and tier-three manufacturers operating in their supply chains. 

This kind of enhanced supply chain visibility is a major asset to businesses in 2026, giving them the data and insights critical to transparency, ESG performance, and other modern success metrics. In this way, supply chain visibility can be viewed as a kind of force multiplier for today’s businesses, bolstering not only their risk management program but also a myriad of other related priorities that play a role in both revenue and reputation. 

In the process of identifying supply chain risks, developing mitigation strategies, and implementing remedial measures, organizations will broaden and deepen their supply chain visibility.

Today’s SCRM Frameworks Need Leading-Edge Tools 

Today’s best supply chain risk management programs are supported by a robust framework, one that provides a concrete, well-defined structure for individuals and teams to follow and develop strategies from. Organizations that decline to use an SCRM framework as the foundation of their risk management strategies may find themselves working on a disconnected jumble of different initiatives, each unrelated to the next. A supply chain risk management framework prevents this sort of makeshift programming, giving businesses a consistent sense of direction and objective, overarching goals. 

Technology plays an essential role in today’s risk management. Software tools can bolster a company’s capacity to address, assess, and mitigate supply chain vulnerabilities. SCRM platform Z2 offers organizations an extensive suite of powerful capabilities that can inform their risk management efforts, including but not limited to:

• Supply chain mapping
• Subtier intelligence
• Supplier risk assessments
• Real-time monitoring
• AI-powered event intelligence
• Data normalization and centralization

To learn more about Z2 and how its features can help strengthen your supply chain risk management framework, schedule a free trial with one of our product experts.