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Article
Still Waiting
DHS Supply Chain Strategy Leaves Many Unanswered Questions

The Department of Homeland Security's much anticipated strategy for managing trade in the face of heightened security levels in the maritime sector or in the aftermath of a transportation security incident was sent to Congress on July 10, 2007.

Many in the trade community anticipated an operational plan that would clearly set out the roles and responsibilities of government officials...


Full Article Below -
Parallax View Article

The Department of Homeland Security’s much anticipated strategy for managing trade in the face of heightened security levels in the maritime sector or in the aftermath of a transportation security incident was sent to Congress on July 10, 2007.  The SAFE Port Act required DHS to develop a strategic plan, in consultation with public and private sector stakeholders, to enhance the security of the international supply chain. Many in the trade community anticipated an operational plan that would clearly set out the roles and responsibilities of government officials who would manage a trade security incident.  Instead they received a 128 page plan that would receive a high grade as a research project for a graduate school class in international logistics, but which lacks any operational grounding.   

The trade community has been asked to invest considerable amounts of money in improving the security of their international supply chains.  First under the Customs-Trade Partnership Against terrorism and now under C-TPAT-inspired programs adopted by other nations following the recommendations of the World Customs Organization, companies are asked to invest in physical, procedural and IT improvements within their supply chains to enhance security from the point where goods are made ready for shipment to their point of distribution in the US or other destination country.  The benefits so far have been reduced scores in US Customs and Border Protection’s targeting system and access to special trade facilitation     programs—benefits which many chief financial  officers         Photo courtesy CBP, photographer James R. Tourtellotte
find as insufficient return on their firm’s investments in
supply chain security. 

For many firms, the real value of C-TPAT membership lies in their presumed ability to move their importations through ports of entry when the Homeland Security Advisory System or MARSEC (the maritime security levels established by the US Coast Guard) security levels are raised to high levels because of the threat of an imminent attack or an actual attack against the maritime system.  A C-TPAT firm validated as operating at the third tier and having a supply chain with documented security—foreign supplier and foreign logistics provider meeting C-TPAT-equivalent standards, shipping full container loads through a Container Security Initiative port on a C-TPAT ocean carrier into a C-TPAT  terminal—presumably would have a high probability that its importations would be the first to be released after emergency shipments.  This is the basic calculus for making the investments in supply chain security.

Thus, there was a great deal of interest in the DHS strategy.  Key requirements of the DHS strategy under the SAFE Port Act are that it identify a prudent and measured response in the event of a transportation security incident involving the supply chain; that it provide protocols for the expeditious resumption of trade after and incident; and that it consider the impact of supply chain security requirements on small- and medium-sized companies.  Many small companies (small companies comprise the vast majority of the nearly 500,000 US importers) that lack a seat at the table in Washington when “the trade community” is consulted were particularly interested in the legislation provision requiring that their interests be considered.

What emerged was a dense description of the existing laws, homeland security directives and governmental policies that taken together comprise the totality of the US approach to international supply chain security.  No one should not attempt to read this document without access to their preferred search engine to cope with the acronyms—three full pages of acronyms are listed in an appendix-- that bestud the document. That is not to say that an operational supply chain security strategy does not exist somewhere within the authorities cited in the strategy, but that it is not evident in this document alone.  Regarding the particular needs of small- and medium-sized companies, the document is silent. 

There are nevertheless important kernels of information within the document that provide guidance for supply chain managers and corporate executives.  Of the many planning documents to consider, the National Incident Management System, which provides a nationwide template enabling the public and private sectors to work together to prevent, prepare for and respond to incidents, together with the National Recovery Plan, provide the framework for responses to supply chain security incidents. A key question regarding the management of responses in the field has been, in the absence of DHS presence outside Washington other than the component agencies, has been, “Who will be in charge?”  While the NRP envisions the designation of a “Principle Federal Official” to oversee management of the response to the incident, it appears that the Coast Guard Captain of the Port will fill that role during a maritime incident.  The Area Maritime Security Committees established under the Marine Transportation and Security and led by the Coast Guard appear to be the key venue for securing information on response protocols. 

If we assume that a “strategy” is the art of deploying resources towards the accomplishment of overarching objectives—in this case the protection of international supply chains and describing the deployment of resources towards the recovery of international trade—the DHS “Strategy to Enhance International Supply Chain Security” leaves us still waiting for answers. 


Check out Mr Spayd's Serious About Port Security? from a previous issue of Parallax View.


 

About Philip Spayd:

Prior to joining Global Trade Systems in January, 2004, Mr. Spayd served for twenty five years with the US Customs Service and Department of Homeland Security, working in the US and representing US Customs globally. He was a founding director of Operations Safe Commerce, the first public-private partnership to develop mechanisms to enhance the security of international supply chains. Mr. Spayd was awarded the Coalition of New England Companies for Trade (CONECT) Annual Person of the Year Award for his contributions to the facilitation of international trade in New England.

 





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