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Build a Secure Supply Chain

Nov. 17, 2006
Securing Global Transportation Networks takes a familiar (and appropriate) approach to security. At its core is a concept the authors label "total security

Securing Global Transportation Networks takes a familiar (and appropriate) approach to security. At its core is a concept the authors label "total security management."

For those who survived the management by buzzword of the 1990s, you might recall some of the many presentations highlighting W. Edwards Deming's "total quality management" (TQM). Deming preached a gospel of enterprise-wide application of best practices and measurable value creation.

In presenting their case for total security management (TSM), authors Luke Ritter, J. Michael Barrett and Rosalyn Wilson resurrect some of Deming's concepts and apply them to security. Unlike Deming, who faced an ingrained corporate culture of compartmentalized isolationist attitudes, the TSM proponents are operating in an environment where recognition of the integration of supply chain functions is slowly becoming institutionalized.

Accelerating the adoption of a total security mindset is a steady stream of laws and regulations coming out of the U.S. Congress and various regulatory agencies designed to protect the United States from another major terror attack.

But before leaving the discussion of TSM and its relationship to Deming's principles, the authors demonstrate more than a fleeting connection when they describe TSM as, "The business practice of developing and implementing comprehensive risk management and security best practices for a firm's entire value chain. This includes an evaluation of suppliers, distribution channels, and internal policies and procedures in terms of preparedness for disruptive events such as terrorism, political upheaval, natural disasters and accidents."

To reinforce the link, the book quotes a Home Depot executive who testified before the U.S. Congress that his company imported goods directly from 268 vendors and sourced 80% of its products from five countries. The retailer went on to point out that Home Depot felt it could use its current quality procedures, including inspections of key vendors, to improve security.

So, if the good news is that you may already know how to do this, the bad news is that it is still a complex task that will require significant investments of time, money and other resources. To set the stage, the authors spend the first four chapters creating a foundation, defining the structured approach, presenting the business case, and analyzing how TSM can be applied and how the tools can help a firm determine its most appropriate risk mitigation strategy.

To be effective, "total security involves everyone throughout your value chain." As established in this second pillar and in other discourse on TSM, security isn't an isolated function. It is also not limited to employees. Vendors, suppliers, contractors, anyone who participates in your supply chain, must be part of the process.

If you can't sequester security in a dark office in the back of your building, you also can't develop a strategy and supporting processes and procedures, put them in a binder and stick them on a shelf to gather dust. "Total security implies continual improvement," the authors state.

And, finally, if just staying in business isn't justification enough for good security practices, the authors note total security practices must be based on creating value that can be measured.

If some of the book is a review of what you learned in TQM, that only speaks to the strength of Dr. Deming's concepts. The rapid pace of change in threats, security technology and techniques as well as the constantly evolving rules and regulations facing global companies mandate an on-going effort to mitigate the many risks facing your extended supply chain. If Securing Global Transportation Networks is your line in the sand, a starting point on the unending path of supply chain risk management, it's a good place to start.

If you have strategies and processes in place for risk management and business continuity, the book is still a good benchmark to test the structure and depth of your current efforts and strategy. Tactics will change with circumstances, but a solid foundation can allow the resiliency needed to make those adjustments.

Securing Global Transportation Networks, by Luke Ritter, J. Michael Barrett and Rosalyn Wilson, is published by McGraw-Hill Companies and is available for $49.95 (www.mcgrawhill.com).

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