In the second quarter of 2024, Lehigh’s Risk Management Index reported cybersecurity as the largest risk for supply chain managers for the fifth consecutive quarter.
The index was created to keep supply chain professionals aware of and involved with the biggest risks to businesses.
Zach Zacharia, a professor in supply chain management and the director of the Center for Supply Chain Research at Lehigh, started the index in 2020.
Zacharia said he decided on the top 10 most important risks to businesses after reducing them from 20-30 after conducting research.
Zacharia said he gathers this data through survey results sent to professionals in the industry.
“A way to always identify those risks that are important is asking, ‘Out of 10, what are the top five risks? What are the top three risks?’” Zacharia said.
He said he was interested to find that generative AI had increased the risk of technology and cybersecurity.
Saif Mir, a professor of supply chain management, said risks are evaluated on a scale of zero to 100 with a mathematical formula used to determine how prominent each potential risk is. The more people who deem a factor a risk, the higher that factor will be ranked.
Mir said the risks at any given moment give information about where the business leaders’ priorities should lie.
“It’s just a great way to gauge the pulse of the supply chain community,” Mir said.
Zacharia said technology is ranked as the second greatest risk, falling just short of cybersecurity.
“Generative AI has to do with technology, not cybersecurity,” Zacharia said. “Cybersecurity was the number one risk, but new technology that I was worried about is generative AI.”
David Hinkle, ‘24, is a supply chain major, who said Lehigh’s Risk Management Index is a great way for students to learn about industry trends from professional perspectives.
He said it allows students to learn what they should pay attention to and be aware of going into the industry.
“The cybersecurity risk factor has been increasing every year, which makes sense due to the strength of malware attacks and the power of AI increasing,” Hinke said. “So it would be something that we should obviously look out for in our early careers.”
Hinkle also said he believes supply chain risk and management is vital to a post-COVID business landscape.
He said every company has realized the importance of the supply chain and managing its risks due to the pandemic, so every business and business student needs to be aware of it.
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