Securing the Supply Chain

The phrase “supply chain” calls to mind a simple chain or line of cargo carriers, going from one point to another. Supply chain security could then be pictured or envisioned as putting the correct security measures in place at various points on that chain, starting with the suppliers and ending with the customers who receive the product.

The correct picture would actually be more like a three-dimensional spider web, where each point in the web had its own 3-D web. After all, your suppliers can have suppliers. Your customers can have customers. Some of your customers can be suppliers, and some of your suppliers can also be customers.

It quickly goes beyond what can be easily envisioned. This raises the question: How can you secure something that you can hardly get your wits around?

Supply Chain Management
Given the size and complexity of a major supply chain, it should be no surprise that supply chain management is not a small subject. As of June 1, there were more than 49 million Google results for the term supply chain, a term which came into use relatively recently (in the 1980s).

The following definition is from Wikipedia:
A supply chain is the system of organizations, people, technology, activities, information and resources involved in moving a product or service from supplier to customer.
Such a definition, while seeming somewhat obvious, is still valuable because it helps to categorize the elements involved. These are all elements that have to be managed. From the management perspective, the above definition leads us to organizational management, HR, IT, operations and logistics — all corporate functions that manage particular aspects of the supply chain. A good perspective on the scope of supply chain management is provided by a short video on the home page of the Supply Chain Management Institute, at www.scm-institute.org.

Competing vs. Common Interests
The Wikipedia supply chain article explains, “Many of the exchanges encountered in the supply chain will therefore be between different companies that will seek to maximize their revenue within their sphere of interest, but may have little or no knowledge or interest in the remaining players in the supply chain.”
This is the problem that Supply Chain Management (SCM) seeks to address. The basic idea behind SCM is to have companies and corporations involve themselves in a supply chain by exchanging information (for example, relating to market fluctuations and production capabilities) for their mutual benefit. Instead of companies operating blindly and independently with regard to the other companies involved in the supply chain, the idea is to optimize the entire supply chain rather than to sub-optimize parts of it based on local interests.