Global Container Security, Transport Management and Freight Flows in the Electronics Industry

Globalisation is stretching supply chains internationally at a time when market volatility is increasing, exposing companies to greater uncertainty. Port stoppages, customs delays and transportation capacity constraints are just some of the dangers global companies face every day. While unexpected disruptions such as terrorist attacks, natural disasters and logistics failures have led to a new operating environment requiring security and resilience. There are significant interdependencies that exist between firms in the global supply network. The interdependence also includes reliance on those UK Government agencies involved with inbound material flows and transportation infrastructure. Given these interdependencies, if one firm fails in the supply network, the entire network performance is at risk. Understandably, this constitutes a new operating environment where firms need to think in terms of their supply network and not just their individual performance. The key takeaway is that it is critical to design supply chain, freight and transport management systems for both security and resilience. For instance, how does container security affect the future of the container? This presentation aims to make an important contribution to the field of global container security and transport management by presenting unique insights from in-depth case work, which was undertaken in the procurement, transportation and freight departments of a multi-national electronics firm (located in Manchester). Our primary focus was to investigate the Authorised Economic Operator (AEO) initiative and the struggles of a multi-national electronics firm based in Manchester as it strives to achieve compliance – at strategic and operational levels. Key findings reveal that the firm will need to pioneer new relationships with U.K. and other Government agencies that now share responsibility for making the supply network secure and resilient. Additionally, it will need to develop deeper relationships with suppliers, third party logistic service providers and customers throughout their supply networks to co-create a more secure and resilient network. Internally, the largest organizational challenge may be in establishing at the individual level a solid understanding of the interdependence of the systems, and the educational and training systems needed for robust network designs and planned responses to disruptions. Overall, we observed a broad range of responses, including many departments that were reactive , as well as departments that surfaced as being progressive. The reactive departments appeared to be responding to government regulations and other mandates, often with a focus on observable and physical actions. The progressive departments appeared to be executing against previously established plans, honing and refining the security and resilience of their supply network beyond just the boundaries of their own firm. Taken all together, this makes for a case where the organization recognizes the need for security and resilience, but did not have systems in place to support adopting suitable levels of security and resilience, and achieves the desired goals without a mandate from the CEO. The leadership of the company did not have to identify security as the most important business driver, but the domain leaders for the progressive departments had to be able to identify the economic risks and build organizational support for the necessary support to create secure and resilient supply chains on a departmental basis. Resilience and security are viewed as necessary competencies to compete and to be successful.