w@reRISK method: Security risk level classification of stock keeping units in a warehouse

Risk management in warehouses is a key issue to guarantee security all along the global supply chains. However, from a balanced approach including at the same time a solid theoretical background and practical processes of implementation, our comprehensive literature and field practices review proved that most of current methods to manage warehouses still do not take into account the risk level classification of stock keeping units (SKU). Thus, the w@reRISK method to analyze the security risk of SKU stocked in a warehouse is here exposed. Since risk analysis involves not only factual data, but also perceptions, this paper proposes a hybrid method based on the ABC classification of SKU as well as a XYZ variability system analysis, but also incorporates the Analytic Hierarchy Process (AHP) to ponder subjective values which are part of risk. The method includes a security risk level classification of SKU, then introduces an exhaustive list of 34 factors useful to judge the risk of a SKU stocked in a warehouse for comparison purposes. An application example is included to demonstrate the use of the method. The lack of analytical frameworks with solid technical basis to secure warehouses along the global supply chains makes this paper a contribution to the body of knowledge in supply chain security, as well as a friendly-user method to practitioners. The proposed method is susceptible to become an automated informatics tool. As a conclusion, key issues for designing secure manufacturing supply chains are discussed, and future research is presented.