Premium
OVERCOMING SPREADSHEET RISK IN SUPPLY CHAIN MODELING
Author(s) -
Galbreth Michael R.,
LeBlanc Larry J.
Publication year - 2010
Publication title -
journal of business logistics
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 2.611
H-Index - 79
eISSN - 2158-1592
pISSN - 0735-3766
DOI - 10.1002/j.2158-1592.2010.tb00141.x
Subject(s) - supply chain , risk analysis (engineering) , computer science , risk management , simple (philosophy) , supply chain risk management , supply chain management , business , service management , marketing , finance , philosophy , epistemology
Spreadsheet optimization modeling plays an important role in the management of today's sophisticated supply chains. However, despite the advantages of spreadsheets (or in some cases because of these advantages) there are significant risks associated with spreadsheet models. Spreadsheet risk is defined as the chance of adverse operational or financial consequences due to erroneous creation, maintenance, and/or use of spreadsheet models. Such errors arise because the intrinsic complexity of optimization models is beyond the expertise of many non‐technical managers. In this article we discuss procedures that we developed for managing the substantial risks associated with the use of spreadsheets for supply chain optimization. The issues we address go far beyond simple data entry mistakes, which are possible in virtually every aspect of business and can never be completely eliminated.