In Depth

How to Improve Supply Chain Security (The Trick Is to Keep It Moving)

Keeping products in motion is key to protecting your global supply chain. Far from dragging down the process, security initiatives help companies pick up the pace.

By Lauren Gibbons Paul

A related idea is to put two drivers in each truck to ensure they won't have to take sleep breaks before reaching their destination.

Get in the Green Lane

Border crossings are the places where those much-feared, time-consuming inspections are most likely to happen. Avnet, a $10.2 billion electronics distributor, serves 100,000 customers in 68 countries, shipping 15,000 orders per day via air and freight, even offering same-day delivery on much of its inventory. That adds up to a lot of stuff that has to get through customsASAP.

"Our customer demands very quick turnaround time on anything he buys from us," says Jim Smith, Avnet senior vice president of operations. To cut time spent in customs, Avnet became an early adopter of federal "safe commerce" programs such as the Customs-Trade Partnership Against Terrorism (C-TPAT) and the Container Security Initiative (CSI). Companies that comply with these programs (which are currently voluntary) can get their goods into and out of the country faster than those that don't.

The concept behind both programs is that companies who consistently meet more stringent security requirements can have their stuff moved to the head of the line. For example, U.S. Customs & Border Protection (CBP) will grant "green lane" status to importers that ship goods in "smart" containers (containers with high-tech tamperproofing and identification equipment) and can provide information about the shipments at least 24 hours in advance. In theory, this will allow low-risk shipments to enter the country more quickly. Another bonus: CBP assigns participating companies an account manager, someone to help solve problems if things slow down.

Sony Electronics participates in several federal initiatives, including C-TPAT, CSI and FAST (Free and Secure Trade, a program between the United States, Canada and Mexico). To comply with these programs, companies have to show they employ a wide range of countermeasures, including performing employee background checks, checking photo badges of workers onsite and inspecting container seals for tampering. In exchange, the companies get faster passage through certain checkpoints.

C-TPAT has endured its share of criticismthat the auditors aren't sufficiently trained, or that the budget allocated is insufficient, for example. Nevertheless, the new CSO at a Fortune 500 food industry company (who requested anonymity) says he thinks C-TPAT and similar programs are among the best homeland security initiatives undertaken in the United States. "There was an initial knee-jerk attempt to dictate matters [after 9/11]. But in particular, I would say customs hasin the last couple of yearsdone what they need to do while still showing an awareness of the realities of business," he says. "To date, I think [these initiatives] are working about as well as could have been expected."

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