MANAGING RISK IN PALM SUGAR REVERSE SUPPLY CHAIN USING INTEGRATION HOUSE OF RISK AND INTERPRETIVE STRUCTURAL MODELING
Palm sugar is an agro-industrial product that is very susceptible to damage. From the results in the field, it is known that 10%-20% of palm sugar is damaged during distribution. Providing value back to damaged palm sugar products can be done by implementing the Reverse Supply Chain (RSC). The food industry must face some risks in implementing RSC. Therefore, we should immediately address these risks to ensure the RSC activities run well. This study identifies risks and determines risk mitigation strategies based on risk priorities. Risk management in RSC activities is carried out by mapping RSC activities in the Reverse Supply Chain Operation Reference (RSCOR) model. This study provides a House of Risk (HOR) and Interpretive Structural Modeling (ISM) based RSC risk management model to determine risk priorities and mitigation based on risk priorities and to understand the relationship between other mitigating action variables. Based on the Pareto principle, it is found that twenty-four risk sources are the primary concern because they contribute to 80% of the occurre1nce of the risk. Through the HOR 2 method, decision makers can prioritize risk mitigation actions based on the largest Effectiveness to Difficulty Ratio of Action (ETDk) value that indicates the possibility of mitigation actions to be realized by looking at the effectiveness of mitigation actions and the availability of available resources. However, this action model has not considered how mitigation actions are related to other mitigation actions. Therefore, the HOR2 method is combined with the ISM method to complete the model. Through the ISM method, decision makers can prioritize risk mitigation actions in cluster IV (Independent).
House of Risk, Interpretive Structural Modeling, Palm sugar, Reverse Supply Chain Risk, Risk Management