Supplier Risk Management Strategies and the Effect on Defense Contractor Operational Performance

The aerospace and defense industry consists of complex supply chain and operating environments that require a diligent focus on risk management. In this industry, supplier and risk management are two topics that have received increased research attention. The main findings in previous studies highlight the importance of close supplier management and its impact on supply chain performance of defense contracting firms. The goal of the present research is to better understand the relationship between supplier management and firm performance, specifically in the context of aerospace and defense sectors. The current study was completed by undergoing an extensive literature review and conducting qualitative interviews with supply chain professionals from defense contracting firms. The results of the interviews yielded emphasis on the importance of supply chain relationships and the impact of continuous measurement of supplier performance on overall defense contracting firm performance. Several differences in effective supplier management practices were identified between previously completed research and present-day practices. The current study aims to further the understanding of current supplier management practices and the relationship to operational performance in the industry.