Steering through the storm: a process framework to guide purchasing and supply managers in navigating low-probability-high-impact disruptions

This study seeks to explore the strategies purchasing and supply managers can employ to navigate the challenges presented by low-probability-high-impact (LPHI) disruptions. The core aim is to create a process framework that provides a systematic, step-by-step method to help purchasing and supply managers effectively deal with the chaos triggered by LPHI events.

The study draws on qualitative data collected from eight firms operating within different industries (healthcare, fishing, food retail and manufacturing), where two firms represented each industry. The data underwent a thorough analytical process involving open coding, axial coding and aggregation of categories, resulting in the identification and formulation of overarching themes.

The analysis unveiled five primary challenges purchasing and supply management (PSM) encountered during the COVID-19 pandemic. These include supply shortages, supplier opportunism, the imperative to build a new supply base, price volatility and the need to make critical decisions based on limited information. It also identified contingent factors that influenced the magnitude of these challenges and approaches applied to address them. Additionally, it identified five responses to the challenges and two contingent factors that affected the responses.

This study extends the existing body of knowledge in purchasing and supply management by developing a process framework tailored to assist purchasing and supply managers in effectively addressing LPHI disruptions. To the best of our knowledge, this is one of the first studies to offer a structured, step-by-step approach that guides PSM professionals in navigating the chaos likely to be caused by such events.