LOGISTICS ASSIGNMENT

Logistics Assignment

Logistics Assignment

Introduction

International trade is a necessity in many supply chains. Global markets present opportunities for growth. Global suppliers often produce product less expensively than it could be produced domestically, supplement domestic production capacity when demand outstrips supply. However, industry and government have become increasingly familiar with the complexity and risks that are characteristic of international trade. Factors contributing to global supply chain risk and complexity include threats of terrorism and the related security measures established to defend against this threat (Christa, 2007). Further, natural disasters (e.g. floods and hurricanes) impact domestic and global supply chains. Finally, as we have seen in recent days with the meat/horse meat scandal, significant recalls relating to product safety can occur.

This sensitivity, in part, relates to the ability of a firm to develop supply chain continuity. Continuity refers to the minimization of supply chain disruptions such that a firm can reduce supply chain disruptions as well as recover should a disruption occur. As such, supply chain continuity is not just about responding appropriately to a crisis, but also about trying to prevent a crisis from occurring in the first place (Rawstone, 2007: 1).

Food sourced or sold internationally travels long-distances leading to a number of points where an unintended disruption could occur, as in the recent cases relating to meat / horse meat. It is estimated that as many as 25 different entities participate in the average global supply chain. These entities include suppliers, government entities, carriers, terminal/port operators, and customers. With each additional party that participates in a given shipment, the risk of intentional or unintentional disruption increases due to the increased number of handoffs involved.

Collaboration between supply chain partners is a key to the success of security initiatives. Supply chain partners who share security related information are more likely to reduce risks and achieve more efficient and effective security implementation. Did this happen in the recent meat fiasco?

Discussion Analysis

Given the increased number of supply chain partners involved in global food sourcing and distribution, and the uncertainty related to the security performance of each entity, it is likely that firms involved in global trade are more likely to engage supply chain partners in security related assessments and information exchange or so the theory goes (Phillip & Kirsten, 1993: 523).

Interestingly, international firms perceive their firms are significantly more likely than firms operating domestically to employ security education programs for their suppliers and customers and participate in audits with suppliers and contract manufacturers, but were not significantly more likely to collaborate with service providers to improve security programs or to only utilize service providers with whom they have an established relationship. This represents a potential vulnerability for firms both domestically and internationally. This vulnerability is potentially magnified by the fact that both types of firms showed little to no agreement that their service providers locked and sealed transportation assets while in transit. Supply chain assets are more vulnerable when sitting still, such as at a service provider's warehouse, or while under the control of a transportation ...