Supply chain security Featured

4:34am EDT June 30, 2004
Our world changed dramatically after Sept. 11.

Some changes were immediate and obvious. Increased security measures at airports became an accepted reality. Although many didn't agree with all of the changes, it was understood that something needed to be done to improve airline safety. The future of the airline industry depended on it. Other changes in the way we live our lives and conduct our business were not as immediate or obvious, but just as necessary.

Prior to Sept. 11, the predominant reason companies were concerned with securing their supply chain was to prevent theft. Now, the threat of global terrorism has created a sense of urgency in the business world to focus on the way product is received and distributed throughout the supply chain. In the process, companies are benefiting from a more efficient supply chain and creating a competitive advantage.

Recognizing that security issues have become an area of great concern for our clients, the Global Supply Chain Solutions Group of Cushman & Wakefield created an alliance with Kroll (www.krollworldwide.com), the world's foremost independent risk consulting company. The challenges we face are great, but failure is not an option. As more companies continue to utilize sources outside of our borders, the concerns of terrorism are real and need to be dealt with.

C-TPAT (Customs Trade Partnership Against Terrorism) is a voluntary government program that addresses terrorist threats in the supply chain. New ideas are being explored to develop strategies and solutions to deliver product safely in a manner that is economically feasible.

Technology will play a vital role in developing security strategies. RFID (Radio-Frequency Identification) has been fast-tracked in the last 12 months. RFID will allow companies to track their product from the point it is manufactured to the point of purchase. Companies such as Wal-Mart are leading the charge. Wal-Mart is asking its top suppliers to utilize RFID in the next year.

Unlike with bar coding, there is no need to have a direct line of sight for the code to be read. Rather, RFID allows for the product to be identified at any point throughout its manufacture, storage, distribution and retail process. Manufacturing facilities, distribution centers and retail stores will have to adapt their real estate to allow for the use of this technology.

Another example is the development of better and more efficient smart containers, cargo-carrying boxes that have the ability to track their location and record if anyone has tampered with them in any way. Tamper straps made from optic fiber are being designed to wrap around objects being guarded. A break-in the optic fiber will trigger an alarm and an RFID report that is flashed through a tracking network.

Every business has a unique set of circumstances and challenges. Diverse product type, manufacturing bases and supply chains make for diverse solutions. As companies continue to explore ways to secure their supply chain, it is important that the walls that existed between their real estate and logistics departments are torn down.

A cooperative effort between government and business will be critical to the success of the war on terrorism. Peter W. Quinn IV, SIOR (pquinn@summitrealtygroup.com) is a co-founder and principal at Summit Realty Group (www.SummitRealtyGroup.com), a member of the Cushman & Wakefield Alliance. He is an industrial specialist with a focus on tenant representation and corporate services. Reach him at (317) 713-2107.