Vietnam Outsourcing Risks Management

Abstract

The exploratory qualitative research study relied on 32 available literatures from 1983 to 2008 to explore the outsourcing risk to the supply chain management infrastructure within the context of an alliance relationship in which the multinational corporation’s manufacturing is outsourced to Vietnam business partners. The paper attempted to define the impact of the Foreign Corrupt Practices Act (FCPA) legislation governing the United States’ Multi National Corporations (MNC), roles of culture, ethicality, and social responsibility principles in assessing and mitigating global risks. The paper discussed ethical leadership behavior in risk management. In addition, the paper presented strategies to integrate a relational exchange model and Cost-of-Risk Analysis (CORA) two-step process for cost-benefit evaluation for mitigating global supply chain management risks. The paper also highlighted financial risk management strategies using a net present value (NPV) of at least zero to embark on expenditure streams. Recommendations, summary and conclusion were also presented.