Research Paper Example on Greece's Decade of Crisis: Economic Collapse and Recovery

Introduction

Undeniably, Greece has been faced with some of the most delicate macroeconomic situations in its recent post-war history (Hall, 2017; p. 7). The country was one of the hardest-hit economies in the aftermath of the 2008 financial crisis. The post-depression situation in Greece was so delicate that its economy was on the brink of collapse in the period between 2009 and 2019. From a complete lack of confidence by the public in their political system to a near-shutdown of the entire economy, the Greek political and economic downturns within the past decade is a matter of entire EU and international business interest.

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The food production and food-based raw materials sector are one of the crucial economic sectors in Greece (Lipovatz, Mandaraka, & Mourelatos, 2000; p. 91) Up to 10% of the Greek labour force is estimated to work in the food-based industry. As such, the country is a reliable exporter of such foods in the European Union. The United Kingdom (UK) has always been a principal importer and trade companion of Greece, especially with the food-based products. In this report-based essay, thereby, the author shall focus on the UK trade relations with Greece while considering the probable risk factors and probable procurement strategies that may remedy the economic and other dangers arising from the procurer-supplier interaction. For this study, the UK-based, family-run firm – Marathon Foods – shall be considered as the illustrative firm to show the extensive UK-Greece business interaction. Marathon Foods is an example of a UK-based local firm that sources food materials extensively from Greece. As such, the analyst shall conduct a critical elaboration of how the procurement function may be used in the management of a network of vendors and suppliers in a highly volatile business environment.

Literature Review

The Procurement Function

Analysts continue to emphasise the continuing evolution of procurement management as a critical supply chain managerial task (Maccarthy et al., 2016, p. 1710). Proper management of material purchases by a firm remains a sophisticated yet crucial process in a company´s organisational success. The procurement function of management has, however, been impacted by a variety of adverse market factors that directly influence the supply chain. Such supply chain factors may be alleviated by a proper identification, prioritisation, evaluation, and implementation of the right opportunities. Often, sourcing is a fundamental approach taken by most procurement managers in their efforts to achieve better cost savings.

While several definitions can be identified for procurement management, this report shall adopt the simplest definition posited by the Project Management Body of Knowledge Guide (PMBOK Guide) book of 2000. According to the PMBOK Guide, Project Procurement Management “includes the processes required to acquire goods and services, to attain project scope, from outside the performing organisation” (PMBOK Guide, 2000, p. 191). From this definition, procurement may thereby be properly conceptualised by understanding the interaction between supply and procurement (purchase). In the interaction, any disruptions in the purchase or the supply sides will hugely impact the procurement/supply relationship. The changes in the demand factors of raw materials will, as such, determine the supply trends and vice versa. Such factors in procurement and supply may range from the external environmental variables and contexts to the internal organisational growth and sustenance strategies.

Supply Risk Management

For proper management of the procurement function by an organisation, the organisation must attempt to holistically and proactively identify and analyse the shifting business environments. The organisation must furthermore analyse the probable risk factors that may impact the vendors and suppliers. The need for a proper business relationship between the customers (procurers) and the suppliers is a crucial factor for the success of the procurement function. For the procurement managers to maintain this relationship, it is essential that they deeply understand the supply chain risks created by potential disruptions in the supply-procurement interactions.

While there are infinite probable definitions of the term supply risk, this report shall adopt the more straightforward definition by Ellis, Henry, and Shockley (2010, p. 44). According to the three authors, the supply risk refers to an individual´s perception of the total potential loss that may result from a disruption in the supply of an item. Nonetheless, a consensual definition of supply risk has not been achieved in the research field of risk management. This report shall, however, rise above the semantic ´noise´ around the definition and adopt the stated definition by Ellis, Henry, and Shockley (2010, p. 44). The risk management department is the organisational section that is charged with analysing risks by businesses and organisations. This department calculates risk probabilities of the firm (the probability of disruptive occurrences) and enhances positive outcomes from the disruptions while simultaneously shielding the business from the extreme impacts of the harmful disruptions (Caron, 2013, p. 67).

Analysts note a variety of general risks and disruptions that often impact the supply and procurement components within the food sector (Nyamah et al., 2017, p. 875). Among the most notable risks are adverse weather, political unrests in the supply and procurement regions, stock contamination, and the Non-damage interruptions. These general risks may be mitigated in varying degrees through strategic procurements and risk management protocols. For this report, however, the author shall investigate the specific risks linking the UK importers of foods from Greece – with Marathon Foods serving as a reference UK business. Such context-specific risks for UK firms importing food materials from Greece may include:

• Brexit – the bailout system that isolated the UK from the Eurozone.
• The economic deterioration in both the UK and especially in Greece, which may create irregular transactions among the vendors and the procurers.
• Social and political upheavals and unrests continue to rock the Greek society as a response to the protracted economic crisis in the country for the past decade. Such social unrest may create unreliable relations between the suppliers and procurers.

Bibliography

Caron, F., 2013. Project Risk Management. Managing the Continuum: Certainty, Uncertainty, Unpredictability in Large Engineering Projects SpringerBriefs in Applied Sciences and Technology, pp.67–74.

Ellis, S.C., Henry, R.M. & Shockley, J., 2009. Buyer perceptions of supply disruption risk: A behavioral view and empirical assessment. Journal of Operations Management, 28(1), pp.34–46.

Hall, P.A., 2017. Varieties of capitalism in light of the euro crisis. Journal of European Public Policy, 25(1), pp.7–30.

Lipovatz, D., Mandaraka, M. & Mourelatos, A., 2000. Multivariate analysis for the assessment of factors affecting industrial competitiveness: The case of Greek food and beverage industries. Applied Stochastic Models in Business and Industry, 16(2), pp.85–98.

Maccarthy, B.L. et al., 2016. Supply chain evolution – theory, concepts and science. International Journal of Operations & Production Management, 36(12), pp.1696–1718.

Nyamah, E.Y. et al., 2017. Agri-food supply chain performance: an empirical impact of risk. Management Decision, 55(5), pp.872–891.

PMBOK Guide, 2000. A guide to the project management body of knowledge 2000th ed., Newtown Square, PA, Pennsylvania: Project Management Institute.