The Role of Supplier Relationship Management in Reducing Operational Risks

Abstract

Supplier Relationship Management (SRM) has become a cornerstone of modern supply chain strategy, offering organizations a systematic mechanism to reduce operational risks and enhance resilience. This study employed a mixed-methods experimental design to investigate how SRM practices—such as collaboration, trust, information sharing, technological integration, and sustainability—contribute to mitigating disruptions, cost volatility, quality failures, and compliance risks. Quantitative analyses demonstrated that organizations prioritizing SRM achieved significantly lower operational risk indices compared to those reliant on transactional procurement models. Regression and structural equation modeling revealed that trust and transparency served as critical mediators in the relationship between SRM and risk reduction, amplifying the benefits of collaborative practices. Qualitative findings highlighted that managers and suppliers perceived SRM as a proactive governance framework that fosters cultural alignment, adaptability, and long-term partnerships. The quasi-experimental interventions further confirmed the causal role of SRM, as firms adopting enhanced SRM initiatives—such as digital platforms for supplier monitoring and sustainability audits—achieved measurable reductions in operational risk levels. Importantly, the study also underscored potential challenges, including technological barriers, power imbalances, and cybersecurity concerns, which may constrain the effectiveness of SRM if not adequately addressed. Collectively, the findings affirm that SRM is not merely a procurement strategy but a strategic governance tool that transforms supplier relationships into partnerships for resilience, sustainability, and long-term competitiveness in uncertain global environments.