Strategic Risk Management in Transshipment Operations: A Case Study of a Logistics Service Provider

Abstract

This research aims to examine business processes, identifies and assesses potential risks, and develop appropriate risk management strategies. The research employs a case study approach, focusing on managerial-level employees from Sales, Customer Service, Accounting and Finance, and Business Development. The primary research tool is a risk assessment framework developed based on group discussions and expert opinions involved in analyzing the index of item objective congruence to ensure data accuracy and reliability. Data collection was conducted via online discussions, and risk levels were categorized into four tiers: Very High (16 points), High (9-12 points), Moderate (6-8 points),
and Low (1-4 points). Subsequently, the researcher will develop a risk management plan for risk factors classified as high or above to mitigate potential damage that may arise in the future. The research findings indicate that the transshipment business process involves the relationship and continuity of work procedures, starting from customers, sales department, business development department, customer service department, documentation department, customs brokers department, and accounting and finance department. Cooperation from each department is required for the operation to be successfully completed. Moreover, most of the risks were found at a medium level, but there were some high-risk risks with a risk level of 12 points, including: Lack of coordination between departments. This risk can be managed by using a digital platform and online work tracking system to increase coordination efficiency. Lack of knowledge in the handover process can be managed by creating a mentoring program for new employees to provide guidance. In addition, the risk level of 9 points includes exchange rate volatility. This risk is managed by entering into forward contracts to hedge against market volatility. There is also the unclear and incomplete coverage of import, export and transshipment regulations, which can be reduced by hiring legal counsel to provide advice on compliance. Implementing these risk management measures is essential for enhancing operational efficiency, ensuring regulatory compliance, and minimizing long-term business disruptions.