Author Archives: Teddy Nee

Enabling Resilience in National Critical Infrastructure

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Growing concerns related to dependencies on software-reliant information communications technology (ICT) and Internet of Things (IoT) devices are pushing changes in governance associated with supply chain risk management (SCRM). The possibility of disruption of critical infrastructure exists because the software that enables these capabilities is vulnerable and exploitable.

Exploit potential is often more about the vulnerability of assets in target organizations than the ingenuity of the attackers. Several breach reports show that the source vectors of attack are in software. Consequently, organizations expanding the use of network-connectable devices need comprehensive software security initiatives to address weaknesses resulting from technological vulnerabilities and a lack of “cyber hygiene” (lack of caution) among those who develop and use software applications and software-reliant IoT devices.

Exploitable weaknesses, known vulnerabilities, and even malware can be embedded in software without malicious intent. Indeed, sloppy manufacturing hygiene is more often the cause of exploitable software. Such poor hygiene can be attributed to the lack of due care exercised by supply organizations with developers, integrators and testers who are often unaware of or untrained on software security, compounded by inadequate testing tools and the failure of suppliers to prioritize addressing the risks associated with the poor security of the software they deliver to the organizations that use it.

How do organizations proactively protect critical infrastructure from being the victim of software provided by others? As a start, they use contracts to set supply chain expectations for their suppliers. Sample software procurement language is available for free to assist organizations in developing their contracts and establishing test criteria as part of software SCRM due diligence. Procurement criteria should contain these specifications, at a minimum:

  1. Software composition analysis of all compiled code found in the supplier product to identify all third-party open source components via a software bill of materials and to identify all known vulnerabilities listed in Common Vulnerabilities and Exposures (CVE) in publicly available databases, such as the NIST-hosted National Vulnerability Database (NVD);
  2. Static source code analysis of all available source code found in the supplier product to identify weaknesses listed in Common Weakness Enumeration (CWE);
  3. Malware analysis of supplier-provided software to determine whether any known malware exists in that software, along with a risk assessment of mitigation controls;
  4. Validation of security measures described in the product’s design documentation to ensure they are properly implemented and have been used to mitigate the risks associated with use of the component or device.

Read more at Software Supply Chain Risk Management: Enabling Resilience in National Critical Infrastructure

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Separating Long-Term Supply Chain Technology Developments from Temporary Industry Disruptors

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While technological innovations can revolutionize how supply chain businesses advance, it’s important for all participants to be a little bit skeptical when supposedly new game-changing technologies are introduced.

Third-Party Providers Navigate Supply Chain Technology Trends

Technology partners with a long-game approach to development and implementation understand that trends come and go, and it can make little sense to heavily invest in trumpeted technological advancements just because they’re “the new thing.”

While technological advancement brings with it solutions that can revolutionize how businesses in the supply chain interact, it’s important for all stakeholders to be a little bit skeptical when any company introduces a supposedly game-changing new technology.

First Adopters of New Technology

3PLs are typically the first adopters of new technology, as a huge part of their value proposition to their clients is their ability to utilize advanced technology to solve their supply chain challenges.

These logistics providers constantly keep their ears to the ground attending conferences and researching the latest technologies seeking new capabilities. 3PLs can make a single investment in technology and leverage that capability across many shippers.

Technology Partners

Technology partners aren’t simply there to help companies adapt to new technologies. Technological advancements in the supply chain have brought increasing amounts of logistics data to industry stakeholders.

This has, in turn, led to a jump in advanced analytics to turn that data into actionable information, a skill in which technology providers excel. Shippers are using analytics in conjunction with real-time visibility data to identify bottlenecks within their own processes and providers’ networks. This visibility allows them to estimate when shipments will arrive at the intended destination with greater certainty. The future is very bright in this area due to improving visibility technology, more advanced analytics, and integrated collaboration tools.

Technology Advancements

Rapid advancements in technology are changing the industry for the better, and at SMC³, our goal is to incorporate these new technologies into the supply chain processes of our clients. SMC³ truly is a neutral third party; we work for the good of the entire supply chain, helping supply chain companies separate lasting supply chain advancements from temporary industry disruptors.

SMC³ accomplishes this flexibility and adaptability by building our solutions for fast, painless integrations to TMS systems and other applications. SMC³’s goal is always to help our clients get up and running as quickly as possible, so they can start consuming data via our solutions and begin to optimize the lifecycle of their LTL shipments.

Read more at Separating Long-Term Supply Chain Technology Developments from Temporary Industry Disruptors

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How Robotics Take the Supply Chain to the Next Level

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We all expected advanced robots to have a disruptive effect on industry — and now robotics has entered the supply chain, too. Some of the ways robotics will advance and reinvent supply chain operations and management are fairly straightforward, while others have been a little more unexpected. Below are four major ways robotics are already taking the supply chain to the next level — complete with specific technologies and implications for each one.

Robots Assume Customer-Facing Roles

Sometimes talking about supply chain operations makes it sound like something that happens away from the public eye. That’s far from the truth, because there are two major points along the average product journey where robots are poised to make a dramatic entrance.

Selective Automation Reduces Injury and Error Risks

One of the greatest supply chain robotics trends to come about so far is selective automation. Far from replacing human jobs outright, selective automation is helping us organize our efforts more effectively by getting people out of dangerous or risky environments, or out of the pilot’s seat of heavy equipment, or away from tedious and error-prone tasks.

Bolt-on Autonomy for Vehicles

There’s an emerging and appealing middle-ground between replacing machinery outright with automated versions and retrofitting your existing equipment, including vehicles, with technology that allows it to operate autonomously.

New Types of Human Jobs

This is not a specific technology. Instead, it’s a cumulative benefit of the technologies we’ve discussed here, as well as many others that are coming of age. All of them come with some welcome reassurance: We’re not obsolete quite yet.

The Supply Chain’s Bright Future

Each one of the benefits of robotics we’ve talked about is helping our global supply chains and all their operators realize a future where machines don’t reduce our quality of life, but rather help us better manage our resources and time. The intelligent application of robotics is one major piece of that puzzle.

Read more at How Robotics Take the Supply Chain to the Next Level

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The Impact of Hurricanes on Transportation and How to Build a Storm Resilient Supply Chain

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This report looks at data before and after Hurricane Harvey in August 2017 and dives into the true cost and volume impacts experienced by logistics customers; it also shares advice on how shippers can prepare for another 2018 challenging storm season.

Hurricanes have massive impacts on transportation capacity and spend.

To better understand true cost and volume impacts, Zipline Logistics evaluated a sample of 33,000 shipments, comparing data prior to the 2017 Tropical Storm Harvey with data after the event.

Access the full report and keep reading this post for the advice you can use to prepare your supply chain for the next tumultuous storm season (Note: the Atlantic Hurricane season runs from June 1 through the end of November.)

Hurricane Impacts on Transportation

We leveraged our KanoPI shipper intelligence platform to dig deep into hurricane impacts. Here’s what we found;

Market surcharges due to hurricane activity were the costliest of added fees in 2017 with a total cost of $673,000.91.

Data shows that the Average Cost Per Load after the 8/26 hurricane went up by $159.58, or 11% and that the Average Cost Per Mile increased by 15%.

915 fewer loads moved after the hurricane (date of 8/26/2017) when compared to previous four-month period. This tells us that people were holding on to shipments that would typically have moved into key areas like Florida, Texas, and surrounding states.

Looking specifically at Florida, there was an 8% drop in volume and 3.4% drop in spending. This shows that for shipments still moved, rates were higher.

Hurricanes brought prolonged delays. Looking at the data, we can see that average transit days went from 2.65 to 2.95, which is an increase of 10.17%.

Read more at The Impact of Hurricanes on Transportation and How to Build a Storm Resilient Supply Chain

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Graph Blockchain Solutions Targets $15.5 Trillion Global Supply Chain Management Logistics Sector

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Blockchain Data Management & Global Logistics Market

With globalization and the increased consumption of various products worldwide, efficient supply chain management and the role of freight and logistics has become increasingly complex.

The global logistics market involves all activities of Supply Chain Management (“SCM”), including transportation, warehousing, inventory management, and the flow of information and order processing.

As previously published by Transparency Market Research, this market is estimated to reach US $15.5 Trillion by 2023.

Multi-national global logistics and freight companies such as FedEx, UPS, and Purolator have openly acknowledged their endorsement of blockchain technology, with all three joining the Blockchain in Trucking Alliance (BiTA), noting that it will bring efficiencies to their industry through consistent, transparent and immutable data.

“We’re quite confident that blockchain has big, big implications in the supply chain, transportation, and logistics,” FedEx CEO Frederick Smith said at the Consensus 2018 conference.

On their company’s press release, Linda Weakland, UPS director of enterprise architecture and innovation, said: “Blockchain has multiple applications in the logistics industry, especially related to supply chains, insurance, payments, audits and customs brokerage.”

Tied to global logistics, South Korea has one of the world’s highest e-commerce rates, however, they have lagged in keeping pace with warehouses and distribution centers. As such, as reported by the Wall Street Journal earlier this year, there has been a wave of investment into high-specification logistics projects across the country, both by the South Korean government through incentives and into Korean logistics properties by institutional investors such as the Canada Pension Investment Board.

Graph Blockchain Solutions

With the growth of this sector as a tactical objective, Graph’s foray into the global logistics industry commenced with providing solutions to divisions of Samsung and LG corporations. Both companies are South Korean based multinational conglomerates, known to be the world’s largest manufacturer of mobile phones and smartphones, and the world’s second-largest television manufacturer, respectively.

By participating in the development of technology that could revolutionize logistics for multi-nationals, Graph has secured a solid position with the goal of becoming a leading solution provider in the sector, focusing on building a global logistics eco-system wherein the graph blockchain solution would reduce downtime by providing real-time monitoring, tracking and business intelligence analytics.

This will enable companies to realize cost savings by mitigating delays and minimizing the impact of lost goods due to cargo theft and fraud, while at the same time driving efficiencies across their SCM.

Read more at Graph Blockchain Solutions Targets $15.5 Trillion Global Supply Chain Management Logistics Sector

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The Right Solution for Contractor and Supplier Management

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The benefits of outsourcing to suppliers and contractors is clear, but the associated risks are largely unseen, and the breakneck pace of change and the pressures of financial reality can cause important, risk-mitigating considerations such as contractor safety to be overlooked – which could be not only an ethical disaster but a business disaster as well.

Contractors and suppliers can provide many essential benefits to businesses such as expertise, efficiency, and cost savings.

In addition, companies working with contractors and suppliers can scale their business up and down depending on market demand.

The benefits of outsourcing to suppliers and contractors is clear, but the associated risks are largely unseen.

To add fuel to the fire, the breakneck pace of change and the pressures of financial reality can cause important, risk-mitigating considerations such as contractor safety to be overlooked – which could be not only an ethical disaster but a business disaster as well.

Contractors working on your site and suppliers providing materials should be considered internal employees.

If contractors are injured on the job, it can seriously damage your organization’s reputation and impede your growth.

To maximize the benefit and minimize the risk of these relationships, companies and their suppliers must commit to a common culture of safety.

This means companies need to stay engaged with their contractors beyond simply hiring them. Companies should:

  1. Regularly collect information from their suppliers that demonstrate a commitment to safety such as incident rates (lagging indicators) and safety programs (leading indicators).
  2. Continuously monitor suppliers’ insurance coverage to protect the company in case something does happen.
  3. Audit worksites on a consistent basis to ensure that safety policies are enforced.
  4. Monitor the condition of equipment that contractors use to carry out their jobs.
  5. Ensure each contracted worker has the proper licenses and certifications to perform the job safely.
  6. Provide site-specific training required for each position.

Read more at The Right Solution for Contractor and Supplier Management

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Retailers worth $3.3trn scaling up supply chain sustainability

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Leading retail powerhouses are stepping up on supply chain sustainability, according to the latest figures from CDP, a global environmental impact non-profit.

The world’s largest retailer, Walmart, has just been joined by three more of the top 20 retail companies – CVS Health, Target Corporation and Tesco – in collecting data from suppliers to reduce environmental risk and cut carbon emissions in the supply chain.

Ten years after CDP started collecting supply chain data on behalf of the world’s largest purchasing organisations, 115 organisations – representing a combined annual spend of more than US$3.3 trillion – are now requesting data from over 11,500 suppliers.

This is more than a 15% increase from last year, when 99 organisations requested data.

Sonya Bhonsle, Head of Supply Chain at CDP, commented: “With emissions in the supply chain on average around four times greater than those from a company’s direct operations – and rising to up to seven times greater for retailers and consumer-facing companies – large multinational corporations cannot comprehensively address their environmental impact without looking to their supply chains.

“It’s very encouraging to see so many of the world’s biggest buyers taking supply chain sustainability seriously. By requesting data from their suppliers, they are shining a light on the risks hidden deep within their production chains – and uncovering a myriad of opportunities for reducing their overall environmental footprint, boosting innovation and cutting costs.”

The rise in companies scrutinising their supply chains coincides with growing momentum behind the take-up of science-based targets – goals that allow companies to reduce their emissions in line with the decarbonisation required to keep global temperature increase below two degrees Celsius, the central aim of the Paris Agreement.

The Science Based Targets initiative (SBTi), which helps companies develop and approves such targets, requires companies to set scope 3 targets if their scope 3 emissions account for at least 40% of their total emissions. For global retailers that do not manufacture many of the products they sell, scope 3 emissions in their supply chain can be far greater than 40%.

Read more at Retailers worth $3.3trn scaling up supply chain sustainability

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The Growing Maturity Of Blockchain

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Speakers from the technology community included Anant Kadiyala, Director of Blockchain & Industry Solutions at Oracle; IBM’s David Noller, Executive Architect Watson IoT – Blockchain and Industry 4.0; and Steven Kim, a Senior Director at SAP. The user community was represented by Jeff Denton, the Senior Director of Global Secure Supply Chain at AmerisourceBergen.

Blockchain technology is incredibly elastic. It can be shaped in different ways, to fit different processes, network node architectures, and participants. It is difficult to generalize about blockchain for business in a way that is universally true. But IBM, Oracle, and SAP – probably the three largest players in the business application blockchain space – were all addressing this topic in a very similar way.

One point all participants agreed on is that blockchain for business applications is not Bitcoin. Bitcoin was the first blockchain application, it is an unregulated shadow-currency, and it is widely seen as a mechanism more conducive to financial speculation than conducting business.

IBM, Oracle, and SAP all built their blockchain platforms on Hyperledger, a technology more suitable to building business applications. Like blockchain for cryptocurrencies, there are mechanisms to make sure transactions are authenticated across a network of participants with distributed databases.

There are several differences between cryptocurrencies and blockchain for SCM. Business blockchain does not include a cryptocurrency, although there may be network style applications that develop that will punch out to the banking system; it is not an open community that any participant can join, but will instead generally involve closed networks of supply chain partners that have been invited to join (permissioned blockchains); blockchain for managing an end to end SCM process can, and probably will, include more business logic and can even utilize IoT sensor data.

Read more at The Growing Maturity Of Blockchain For Supply Chain Management

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10 Ways Machine Learning Is Revolutionizing Supply Chain Management

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Machine learning makes it possible to discover patterns in supply chain data by relying on algorithms that quickly pinpoint the most influential factors to a supply networks’ success, while constantly learning in the process.

Discovering new patterns in supply chain data has the potential to revolutionize any business. Machine learning algorithms are finding these new patterns in supply chain data daily, without needing manual intervention or the definition of taxonomy to guide the analysis. The algorithms iteratively query data with many using constraint-based modeling to find the core set of factors with the greatest predictive accuracy. Key factors influencing inventory levels, supplier quality, demand forecasting, procure-to-pay, order-to-cash, production planning, transportation management and more are becoming known for the first time. New knowledge and insights from machine learning are revolutionizing supply chain management as a result.

The ten ways machine learning is revolutionizing supply chain management include:

  1. Machine learning algorithms and the apps running them are capable of analyzing large, diverse data sets fast, improving demand forecasting accuracy.
  2. Reducing freight costs, improving supplier delivery performance, and minimizing supplier risk are three of the many benefits machine learning is providing in collaborative supply chain networks.
  3. Machine Learning and its core constructs are ideally suited for providing insights into improving supply chain management performance not available from previous technologies.
  4. Machine learning excels at visual pattern recognition, opening up many potential applications in physical inspection and maintenance of physical assets across an entire supply chain network.
  5. Gaining greater contextual intelligence using machine learning combined with related technologies across supply chain operations translates into lower inventory and operations costs and quicker response times to customers.
  6. Forecasting demand for new products including the causal factors that most drive new sales is an area machine learning is being applied to today with strong results.
  7. Companies are extending the life of key supply chain assets including machinery, engines, transportation and warehouse equipment by finding new patterns in usage data collected via IoT sensors.
  8. Improving supplier quality management and compliance by finding patterns in suppliers’ quality levels and creating track-and-trace data hierarchies for each supplier, unassisted.
  9. Machine learning is improving production planning and factory scheduling accuracy by taking into account multiple constraints and optimizing for each.
  10. Combining machine learning with advanced analytics, IoT sensors, and real-time monitoring is providing end-to-end visibility across many supply chains for the first time.

Read more at 10 Ways Machine Learning Is Revolutionizing Supply Chain Management

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Supply Chain Network Optimization Technology is Ripe for Disruption

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Something struck me after spending a few days in Phoenix at Gartner’s Supply Chain Executive Conference.

Supply Chain Network Optimization is key to running an efficient and profitable operation today.

But while the market has changed, network optimization hasn’t actually advanced much since the 1990s. Yes, there are lots more features and a big increase in computing power. Yet, network optimization is still just a richer version of the 90’s experience.

Analyzing the Software Market

Network optimization software has become a big business that’s experienced exponential growth. There has been a strong adoption of boxed solutions that are feature rich with many bells and whistles.

What I heard at the Gartner conference is growing frustration with these large packages that have become cumbersome to use, too difficult for the average supply chain expert, lack flexibility and have high price tags. Sound familiar?

So what is the alternative? First, we need to go back to the original purpose. Supply Chain teams shouldn’t be overly focused on technology. Instead, they should have their eyes set on the desired outcome.

Supply Chain teams want a supply chain network that runs in an optimized fashion, with signals that indicate when and where to invest in future infrastructure. The network optimization tool should just be a means to an end.

So why hasn’t it become easier and cheaper to have an optimized network? Why are companies investing more and more in this focused discipline?

Read more at Supply Chain Network Optimization Technology is Ripe for Disruption

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