Prince Amir Al Saud

Securing the Different Elements of the Supply Chain

Securing the Different Elements of the Supply Chain

When different organizations, resources, information, systems and processes, and people come together to provide and move a certain product or service from its supplier and manufacturer to the end-consumer, a supply chain is established.

Since the supply chain involves a lot of commercial and industrial entities, each with their own unique set of organizational resources, systems and processes, and infrastructure, it becomes readily apparent that threats to any of these salient points can adversely affect the provision of such products or services to the consuming public. And with today’s highly volatile geopolitical situation further heightened by threats of terrorism and the proliferation of criminal organizations all over the world, it has become very important, more than ever, to institute measures that will ensure the safety and security of these critical elements to the supply chain.

The supply chain will always start with suppliers of raw materials needed to produce or manufacture a certain product. Unfortunately, a good majority of these raw materials suppliers bring their products to middle suppliers or contractors who will initially process the raw materials into readily consumable forms. By the time the refined raw materials reach the manufacturing company’s facilities, they undergo final processing before being used for the manufacturing or production process. The finished product is then delivered to another facility for other aspects of manufacturing process. These are then turned over to middle consumers or retailers who will then have to sell them to end-consumers. The entire process is lengthy. As such, problems or issues in any aspect of the supply chain can have a serious effect on the finished product that is consumed by average end-users.

The threat of terrorism and criminal organizations on the supply chain is very real. Annually, the economies of the world lose more than a couple of tens of billions of dollars to acts of terrorism as well as organized criminal activities. Billions of dollars-worth of goods is continually smuggled across international borders.

Breaches in the security of individual companies or organizations in the supply chain can also disable the entire chain especially if the different organizations are connected on a single network infrastructure. This makes them particularly vulnerable to cyber-attacks.

Cargo theft and highway robberies can also significantly threaten the integrity of the supply chain particularly in terms of providing the product to the end-users.

In some more serious cases, legitimate companies that operate within a particular supply chain get severely compromised and exploited by criminal organizations. For example, a supplier of raw materials needed for the production of building and construction materials will require the use of transportation infrastructure such as commercial rigs.

Instead of filling the container truck with the raw materials, half of the space can be filled with contraband items such as drugs, arms, prohibited goods, and even people.

The truck runs on 50 percent raw materials needed by the manufacturer and another 50 percent illegal items. Technically, the effect is two-fold.

One, since the truck only delivered 50 percent of the raw materials it was supposed to carry this affects the production capacity of the company.

Two, the contraband items are directed into the black market where products sold can significantly undermine the efforts of legitimate business. Both will significantly affect the general economy.

It is for this reason that every company involved in the supply chain must be able to institute security measures to help prevent the illegal use of their assets and resources.

Closer coordination with other companies in the supply chain as well as cooperation with local and national law enforcement agencies will go a long way towards the mitigation and management of security threats on the supply chain.    

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