Wednesday, January 25, 2012

National Strategy for Supply Chain Security

The US Secretary of Homeland Security, Janet Napolitano, presented a "National Strategy for Supply Chain Security", signed by the US President, Barack Obama, at the World Economic Forum today.

Because of disruptions in global supply chain, including those as a result of natural disasters, criminal and/or terrorist attempts, supply chain security is now a matter of US national security. It not only applies to all cargo goods entering the US but the strategy would set the stage for US action to strengthen the security provided in other countries. 

The report enlists the cooperation of other nations and industry leaders to come together and submit thoughts and recommendations on such matters as methods to share information, streamline government processes and synchronize standards and procedures.

International cooperation for a safe and secured global supply chain is well and good but getting buy in from all those involved is another matter. According to Yosef Sheffi of MIT, the strategy may have "limited effect" unless it is followed up by something with more teeth, such as a presidential order or a Congressional law that requires the government and industry to collaborate. Also, buy in from US trade partners is important. Such questions as cost, implementation etc. will be major concerns for all involved. It will be difficult to keep politics out of the discussions.

Still, it is a good beginning and hopefully will at least get all parties involved talking and thinking about risks in the supply chain. Perhaps this will result in companies to wake up and reevaluate their own supply chains and implement disaster preparedness plans in case the unforeseen incident occurs. Both reevaluation of supply chains and disaster preparedness plans should always be reviewed on a regular basis anyway and not just when an incident occurs.

So, for the next six months, the Department of Homeland Security and the US Department of State will gather feedback from the international community and industry stakeholders on how to implement the strategy in a cost effective and collaborative manner. Afterwards, a comprehensive report will be compiled and presented.