Emergency in supply chain security

Who needs to consider what challenges?

Cargo losses, damaged brand reputation, and negatively impacted customer loyalty, can result in risks to public and employee safety, and lead to lost productivity, complex and costly recovery processes, and increased insurance premiums. Innovation and Globalization in supply chains are getting more complex and sensitive to all kinds of risk. Theft and damage during transport disrupt the supply chain and risk management has become an absolute necessity.

Security Leaders: Customer needs, technology, and criminals will not standstill. Supply chain security will continue to change and every day, a different challenge presents itself. Sometimes the challenges depend on trusting others (human factor) or can be a matter of cargo theft. Leaders must be vigilant about evolving threats and create opportunities to improve efficiency and minimizing the risk across the supply chain.


Finance Leaders: Supply chain security must be cost-effective. There is no point in spending more to protect cargo, compared to loss caused. However, the real cost of loss of a shipment may be as much as 5 to 7 times the value of the shipment alone. Factors increasing loss include the time and effort to replace the shipment. Opportunity costs may arise through having to replace the shipment instead of being able to pursue new business.

Technology Leaders: Supply chain security calls for more physical security technologies such as seals, global positioning, and other sophisticated locating and tracking applications as well as sensors used for detection. Then there is a need for geofencing to secure routes. Secure systems to send automatic, real-time notifications whenever a trailer moves in or out of preapproved coordinates, allowing fleets to proactively react to possible cargo theft. Based on sensors and analytics, collected data allows a carrier to know if idle and/or dwell time is occurring in a safe place or not. Knowing where the hotspots are in terms of cargo theft based on historical data is also used for route planning.

Customer Service Leaders: Secured transportation of sensitive theft goods is critical to the achievement of customer service, and overall supply chain effectiveness. Proper precautions must be taken to protect cargo from loss due to theft. We also envisage further increases in pilferage and robbery attempts on vehicles, especially with goods that are difficult to trace. Each loss of cargo not only poses a great threat to on-time delivery but also creates challenges for customer satisfaction.

Supply Chain Leaders: Concerns about security requirements are not only limited to cargo theft but the overall disruptions in customer production schedules, the added costs, which ultimately can lead to the impact of higher prices on finished products. The assessment of personal and organizational relationship characteristics that exist between supply chain partners can help improve the efficiency and effectiveness of security efforts. Strengthened security requirements force supply chain partners to have the capability in meeting new security precautions, especially for high value goods.