Risk Management in Sustainable Patchouli Supply Chain

This study introduces a novel, systematic risk management framework for the patchouli supply chain in Aceh Province, Indonesia, utilizing the House of Risk (HOR) model integrated with the Supply Chain Operations Reference (SCOR) approach. Unlike previous research, which has focused mainly on market dynamics or production techniques, this work applies the HOR methodology—a combination of Quality Function Deployment (QFD) and Failure Modes and Effects Analysis (FMEA)—to comprehensively identify, assess, and prioritize supply chain risks across all actors, from farmers to exporters. Employing a descriptive qualitative design, the research engaged 172 stakeholders through purposive and snowball sampling, in-depth interviews, and participatory observation to ensure robust risk mapping and validation. The HOR analysis enabled the prioritization of risk agents and the formulation of targeted mitigation strategies based on their effectiveness-to-difficulty ratios. Key findings highlight that processing patchouli waste into organic fertilizer, product diversification through research and development, and strengthening access to capital via partnerships with financial institutions are among the most effective and feasible strategies for risk mitigation. These interventions address critical ecological and economic risks, enhancing supply chain sustainability, resilience, and competitiveness. The methodological applicability of the HOR model is demonstrated by its adaptability to other agricultural supply chains, offering a proactive, data-driven approach to risk management that supports sustainable agricultural ecosystems. This research provides actionable recommendations for policymakers, industry stakeholders, and farmers, advancing both the theory and practice of sustainable supply chain risk management in the essential oils sector.