Making sense of labour-related risks in supply chains : decision-making under uncertainty

Sammanfattning

The purpose of this study is to examine how organisations make sense of and prioritise supply chain risks in uncertain settings, using labour-related risks in multi-tier supply chains as the empirical context. Drawing on bounded rationality and organisational sensemaking, the study explores how organisations deal with risks in contexts with limited visibility, fragmented information, and complex supplier networks. A qualitative research design was adopted using semi-structured interviews with practitioners working in sustainability, procurement, and supply chain risk management. The findings show that organisations rely extensively on formal systems, indirect information, and standardised procedures to generate workable representations of risk and facilitate decision-making under uncertainty. Additionally, risk prioritisation was not solely shaped by formal indicators, but also by organisational constraints, competing priorities, and interpretive processes. The findings further suggest that formal governance systems enable organisations to manage uncertainty organisationally without necessarily resolving the underlying structural opacity in multi-tier supply chains. This study contributes to the supply chain risk management literature by demonstrating how governance systems function as organisational mechanisms for simplifying complexity and enabling action under uncertainty.