Managing supplier risk through procurement decisions: a decision-making framework for the automotive industry

Abstract

Purpose Automotive supply chains face increasing exposure to supplier-related disruptions, yet existing frameworks inadequately integrate risk categorisation, procurement decision-making, and supply chain resilience into a unified decision-support structure. This study addresses that challenge by developing and validating a theory-grounded supplier risk decision-making framework for procurement managers in the automotive industry. Design/methodology/approach A systematic literature review (SLR) of peer-reviewed publications was conducted to synthesise supplier risk typologies and procurement decision frameworks. The resulting framework was subsequently validated through structured interviews with automotive industry experts to ensure practical applicability and managerial relevance. Findings This study presents a comprehensive supplier risk categorisation comprising six major risk types and thirty-seven contributing factors. Procurement decisions are organised into three groups: supplier categorisation, supplier performance management, and supplier relationship management. A novel supplier risk decision-making framework, grounded in prescriptive decision theory and informed by contingency theory, delineates strategic, tactical and operational decision-making stages to support effective supplier risk mitigation. Practical implications The framework has been adopted by a leading UK automotive manufacturer to train procurement professionals, providing evidence of its practical relevance and real-world applicability. Social implications The framework contributes to more stable and resilient automotive supply chains, supporting business continuity and reducing the broader economic disruptions associated with supplier failures in a sector of considerable economic importance. Originality/value The proposed framework integrates supplier risk management, supply chain resilience and procurement decisions, offering a holistic foundation for effective and informed decision-making.

The authors' abstract, as published at the source. Benchmarking An International Journal, 2026 · DOI ↗