Supply Chain Security Study Guide

2. Background to supply chain security

Learning objectives

✓	Explain why supply chain security has become a major focus of international trade policy
✓	Define supply chain, supply chain management and supply chain security management
✓	Identify the three principles that determine the effectiveness of a supply chain

‘The terror and tragedy of September 11, 2001, have emphasized the need for reforms in border and transport infrastructure. Terrorist attacks can seriously disrupt the passage of people, goods, and modes of transport across borders. Measures designed to stop terrorism can add certainty and stability to the global economy, raise investor confidence, and facilitate trade. Secure trade is now as important as free trade.’ (World Bank, 2003, p182)

Government and business were concerned that international terrorists could use supply chain systems to carry weapons of mass destruction, or to destroy critical parts of the supply chain itself. This drove momentum for new supply chain security standards at national, regional and global levels. Many of these programs were introduced quickly after 9/11 but have now become a permanent feature of international trade:

Since the terrorist attacks on 11 September 2001, the number of initiatives that have the aim of strengthening security in the international supply chain has increased rapidly. The initiatives consist of programmes for partnership between customs authorities and companies, rules for advance communication of data on international shipments, minimum security requirements, standardisation of security management and cooperation between companies. Most of the initiatives have been taken by governments or customs authorities but many international organisations are also active in this field. (Kommerskollegium 2008)

National measures alone are not enough. Governments have recognized that they must work with the private sector and with other governments to secure the supply chain end to end. This has produced a coordinated international approach, delivered through international organizations and through the industries that operate the supply chain.