New global intelligence report looks at supply chain resilience
- Published: Wednesday, 17 November 2021 13:17
BSI has published its annual Supply Chain Risk Insights Report, which identifies the trends and associated risks expected to impact global supply chains over the coming year. The report is powered by analysis of the global data in BSI's proprietary web-based intelligence system, Connect Screen.
The emerging threats highlighted in the report include:
Crime: the importance of verifying, then trusting
The pandemic showed companies of all sizes from around the world the importance of adaptability, and criminal organizations were no exception. Over the past year, BSI has observed a significant number of criminal organizations trying to infiltrate the logistics supply chain, masquerading as legitimate companies working in warehousing, transportation and distribution. BSI has also noted the issue of fake carriers in an increasing number of countries.
Climate: green-proofing the supply chain
From all corners of the globe, companies are seeking to both protect their supply chains from the effects of climate change and ensure they play their role in a greener future. Maintaining ESG compliance in evolving regulatory environments should now involve considering the impact on the entire supply chain. For example, BSI noted that this year, at least 18 companies-spanning several industries were identified as sourcing products from companies contributing to deforestation in the Amazon. This type of association has the potential to bring significant reputational damage to an organization and could ultimately result in a drop in revenue.
Convergence: Problems piling up
An overarching threat to supply chains is the risk that individual considerations such as business continuity, sustainability, corporate social responsibility (CSR) and security are not addressed comprehensively, and that organizations fail to acknowledge that they are interrelated. Business continuity threats can lead to security threats and vice versa.
The global shortage of semiconductors exemplifies this convergence. Taiwan holds roughly 90 percent of the world's manufacturing capacity to produce semiconductor chips, an overreliance that contributed to the global shortage of this component. In addition, factors such as droughts and COVID outbreaks in Taiwan between April and July impacted operational capacity, compounding the global shortage. This shortage also created security concerns; for example, a group of criminals attacked a truck driver's assistant as he was transporting a high-value cargo of semiconductor chips in Hong Kong in June, stealing $650,000 worth of goods.
Another high-profile convergence – between cyber security and physical security in this case – made international headlines in April this year. In the US, hackers gained entry into the Colonial Pipeline through a virtual private network account, which was intended for employees to remotely access the company's computer network. The hack took down one of the largest fuel pipelines in the country and led to gas shortages across the East Coast – all because of a single compromised password.
Convergence can be addressed by companies doubling down on collaboration, ensuring that all parts of an organization and their partners understand the integrated threats to a supply chain and that teams work together to address them.
It's essential that organizations have clear insight into the global supply chain landscape and how its ever-evolving dynamics will impact the future.
To read the full report, please click here.