Page 329 - DMGT523_LOGISTICS_AND_SUPPLY_CHAIN_MANAGEMENT

Logistics and Supply Chain Management

Notes The analysis of the supply chain took place in three phases:

Phase 1:

Aim: Identify where a majority of the reported losses were taking place
The initial trigger for the outlined risk analysis project was the result of an investigation
conducted by the rail operator. The operator reported that the majority of thefts were
taking place between Houston and Los Angeles, and that a shipment of 2000 to 3000
containers would have 40 to 50 seals broken. Not all the goods would be missing however,
indicating that criminals were looking for very specific products. Furthermore, when
entire containers were stolen, they would usually be found discarded and empty within 24
hours of the event.
Aim: Identify Major Players in the Supply Chain
The client works with over 10 different logistics partners in the Houston – Los Angeles
stretch alone. These partners are a mixture of multinational suppliers and local trucking
companies. Each of the companies were identified and a detailed report was drafted on
information including the scope of operation, management team etc. All of these parties
were contacted and meetings were arranged for phase two. Based on the two aims, a
detailed schedule and assessment plan was drafted to ensure the interviews and identified
weak points in the supply chain would be investigated during the subsequent phase of the
project.
Phase 2:

The TÜV Rheinland team met with all the logistics providers identified in phase one. The
one-day meetings included an onsite tour and an overview of daily operations, with a
special focus on the client’s security objectives. Furthermore, all incident reports and
response plans were analyzed for each of the 3PL companies. To ensure total analysis, the
team also conducted unscheduled night visits to determine whether or not there were any
significant weaknesses evident after hours.
Outcome:

Following the completion of the onsite analysis, the team evaluated the threat levels for
each individual site. Several notable weaknesses were identified at all of the sites, including
a lack of document control and weak information security. It became very clear that there
were some consistent weakness between the companies. While the majority of the 3 PL’s
had good physical security, few of them had a monitoring system in place to ensure
improvement. After completion of the onsite audits and interviews, the TÜV team
embarked on a detailed risk analysis of the supply chain from Houston to Los Angeles.
This part of the project involved 2 weeks of tracking trains along the route, looking at rail
stations, fencing, urban areas, pit stops, and trucking routes. This part of the project allowed
the team to identify clear risks in the supply route, which included for example;
 Breaks in fencing

 Long stops at night
Contd...

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