Transforming Non-Critical External Suppliers to Domestic Suppliers: A Risk Management Approach to Building a Competent Supply Chain in The Defense Industry

Abstract

This thesis explores the transformation of non-critical external suppliers into domestic suppliers within the UAE’s defense industry, emphasizing a structured risk management approach to enhance supply chain competence and performance. The study identifies key challenges associated with supplier localization, including quality control, cost competitiveness, and compliance with defense industry regulations. By integrating supplier development initiatives and project risk management strategies, the research aims to address project-specific risks while promoting a resilient and self-sufficient supply chain. The study applies theoretical frameworks such as the Resource-Based View (RBV), Transaction Cost Economics (TCE), and Supply Chain Risk Management (SCRM) to assess the interplay between risk mitigation, supplier capacity building, and localization efforts. Using a descriptive research design supported by quantitative survey data collected from stakeholders in the UAE defense sector, the research develops a comprehensive risk management framework. Findings reveal that effective project risk management and targeted supplier development positively influence supply chain resilience, efficiency, and responsiveness. The study offers practical recommendations for policymakers and industry leaders to strategically localize suppliers, improve compliance, and mitigate risks in defense operations. The research contributes to academic knowledge and industry practice by bridging gaps in supplier localization literature while supporting national security and economic growth.