Security, Compliance Loss Prevention Part 12

1. Course
Material
Reference

2. Important Dates
▶ Midterm 3/7/2024
▶ Assignment 3/13/2024
▶ Final 3/18/2024
This Photo by Unknown Author is licensed under CC BY-SA-NC

3. Assignment Review

4. Attacks on the supply chain are a common
way for cybercriminals to interfere with a
company's manufacturing procedures
using either hardware or software.

5. Considering time frames helps
organizations develop effective
strategies to address risks and
disruptions in a timely manner.

6. Effective supply chain risk management
requires a combination of proactive
planning, strong relationships with
suppliers, and the ability to adapt quickly
to changing circumstances.
True

7. Key activities involved in supply chain
risk management include Risk
Identification, Risk Assessment, and
Risk Mitigation/Control/Monitoring

8. Political risk is the risk an investment's
returns could suffer as a result of political
changes or instability in a country.
True

9. Recurring Risks of Supply Chain include
quality control issues, economic factors,
and regulatory compliance.

10. Supply chains are complex networks that
involve the movement of goods,
information, and resources across various
stages, from raw material suppliers to end
consumers.
True

11. Time frame is important in supply chain
risk management because different risks
have varying lead times, potential
impacts, and windows of opportunity for
mitigation and response.

12. Security,
Compliance
& Loss
Prevention

13. Hybrid Threat
▶ A hybrid threat is one posed by
any current or potential adversary,
including state, non-state and
terrorists, with the ability, whether
demonstrated or likely, to
simultaneously employ
conventional and non-
conventional means adaptively, in
pursuit of their objectives.
Making informed security and
resilience decisions requires a
hybrid threat perspective. State
and non-state actors are
challenging countries and
institutions they see as a threat,
opponent or competitor, through
use of hybrid tactics. With the
success of hybrid activities
targeting critical infrastructure
globally and increased
opportunities for influencing
through information technology,

14. Hybrid Threat
▶ Hybrid threats are those posed
by adversaries, with the ability to
simultaneously employ
conventional and non-
conventional means adaptively
in pursuit of their objectives. The
range of methods and activities
is broad and multidimensional:
cyberattacks on energy
systems, influencing
information, exploiting supply
chains and resource
dependencies; undermining
international institutions;
terrorism and transnational
organized crime. Hybrid
activities target vulnerabilities of
the opponent with the intent of
remaining below the threshold of
war; however, these conflicts
can escalate into warfare
involving conventional military

15. What is Supply Chain
Management
▶ Supply chain management
(SCM) is the active
management of supply chain
activities to maximize
customer value and achieve
a sustainable competitive
advantage. It represents a
conscious effort by the
supply chain firms to develop
and run supply chains in the
most effective & efficient
ways possible. Supply chain
activities cover everything
from product development,
sourcing, production, and
logistics, as well as the
information systems needed
to coordinate these activities.

16. What is Supply Chain
Management
▶ The concept of Supply Chain
Management (SCM) is based on two
core ideas:
1. The first is that practically every
product that reaches an end user
represents the cumulative effort of
multiple organizations. These
organizations are referred to
collectively as the supply chain.
2. The second idea is that while supply
chains have existed for a long time,
most organizations have only paid
attention to what was happening
within their “four walls.” Few
businesses understood, much less
managed, the entire chain of
activities that ultimately delivered
products to the final customer. The
result was disjointed and often
ineffective supply chains.
The organizations that make up the
supply chain are “linked” together

17. What is Supply Chain
Management
▶ Physical Flows
Physical flows involve the
transformation, movement,
and storage of goods and
materials. They are the most
visible piece of the supply
chain. But just as important
are information flows.
Information Flows
Information flows allow the
various supply chain partners
to coordinate their long-term
plans, and to control the day-
to-day flow of goods and
materials up and down the
supply chain.

18. Cargo Theft
▶ The Escalating Threat of
Cargo Theft
Cargo theft is a multifaceted
menace that transcends industry
boundaries, affecting companies
irrespective of their size.
Criminal entities are
continuously evolving their
tactics, targeting shipments at
various stages of the supply
chain, from pilfering goods
within warehouses to hijacking
trucks in transit. The
repercussions of cargo theft are
severe, including delays in
deliveries, surging insurance
costs, and erosion of profit
margins. Additionally, the ripple
effect extends to consumers in
the form of higher prices and

19. Cargo Theft
▶ Peering into the Depths of
Organized Retail Crime
The driving force behind cargo
theft is often organized retail
crime (ORC) groups, which
operate with alarming precision
and coordination. These criminal
entities employ a wide array of
tactics, including hijacking
shipments, infiltrating
distribution centers, and
corrupting supply chain
personnel. They exploit
vulnerabilities within the supply
chain to gain the upper hand,
rendering it an arduous task for
businesses to defend against
their sophisticated strategies.
The NRF's estimate of a
staggering $100 billion annual

20. Cargo Theft
▶ The Urgent Need for
Technological Intervention
As cargo theft persists and
adapts, businesses must rise
to the occasion by embracing
advanced technologies to
bolster their supply chain
security. Among these
innovations, LoadProof
emerges as a standout
solution, providing real-time
monitoring and an array of
security features that are
indispensable in the battle
against cargo theft.

21. Butterfly supply chain
▶ The "butterfly effect" is a
concept from chaos theory
that suggests small
changes in one part of a
complex system can have
significant and
unpredictable effects on
other parts of the system.
When applied to the supply
chain, the butterfly effect
highlights how minor
disruptions or changes at
any point in the supply
chain network can
propagate and amplify,
leading to significant
impacts on operations,
costs, and customer

22. Butterfly supply chain
▶ Mitigating the butterfly effect in the supply
chain requires proactive risk management
strategies, including:
• Developing robust risk assessment
processes to identify potential disruptions
and vulnerabilities.
• Implementing supply chain visibility tools
to monitor and track inventory, shipments,
and production processes in real time.
• Diversifying supplier networks and
establishing contingency plans to mitigate
the impact of supplier disruptions.
• Enhancing collaboration and
communication with supply chain partners
to facilitate rapid response and recovery
during disruptions.
• Investing in technology solutions, such as
predictive analytics and artificial
intelligence, to anticipate and mitigate
supply chain risks proactively.
By acknowledging the
interconnectedness and complexity of the
supply chain ecosystem, organizations
can better prepare for and respond to the
butterfly effects of disruptions, enhancing

23. Supply chain risk
management
▶ Supply chain risk management
(SCRM) involves identifying,
assessing, and mitigating risks
within the supply chain to ensure
continuity and resilience. Here's a
breakdown of a management
approach in SCRM:
• Risk Identification: The first step
is to identify potential risks
throughout the supply chain. This
involves examining each stage of
the supply chain process, from
sourcing raw materials to
delivering finished products to
customers. Risks can include
supplier bankruptcy, natural
disasters, geopolitical instability,
quality issues, etc. Companies can
use various tools such as risk
registers, SWOT analysis, and

24. Supply chain risk
management
• Risk Assessment: Once risks are
identified, they need to be assessed
based on their probability and potential
impact on the supply chain. This
involves quantifying risks in terms of
likelihood and severity. Risk
assessment techniques such as risk
matrix analysis or probabilistic
modeling can help prioritize risks
based on their potential impact.
• Risk Mitigation Strategies: After
assessing risks, organizations need to
develop mitigation strategies to reduce
their likelihood or impact. Mitigation
strategies can vary depending on the
nature of the risk but may include
diversifying suppliers, dual-sourcing
critical components, implementing
inventory buffers, creating redundancy
in logistics networks, and developing
contingency plans. Collaboration with
suppliers, third-party logistics
providers, and other stakeholders is

25. Supply chain risk
management
• Continuous Monitoring
and Evaluation: Supply
chain risks are dynamic and
can change rapidly due to
various factors such as
market conditions,
geopolitical events, and
technological disruptions.
Therefore, it's crucial to
continuously monitor the
supply chain for emerging
risks and evaluate the
effectiveness of existing
mitigation measures. Key
performance indicators
(KPIs) and metrics can be
used to track the
performance of the supply

26. Supply chain risk
management
• Collaboration and
Communication: Effective
communication and
collaboration among supply
chain partners are essential
for successful risk
management. Establishing
open lines of communication
and sharing information
regarding potential risks and
mitigation strategies can help
build trust and facilitate
coordinated responses to
disruptions. Collaborative
efforts such as joint risk
assessments, supplier
development programs, and
shared technology platforms
can enhance the resilience of

27. Supply chain risk
management
• Investment in Technology
and Data Analytics:
Leveraging technology and
data analytics can enhance
visibility and agility in supply
chain risk management.
Advanced analytics,
predictive modeling, and
real-time monitoring tools
can help identify potential
risks early and enable
proactive decision-making.
Investing in technologies
such as blockchain, Internet
of Things (IoT), and artificial
intelligence (AI) can also
improve traceability,
transparency, and

28. Supply chain risk
management
• Scenario Planning and
Preparedness: Finally,
organizations should develop
robust contingency plans and
conduct scenario planning
exercises to prepare for potential
disruptions. This involves
simulating various risk scenarios
and testing the effectiveness of
response strategies to ensure
readiness in the event of a crisis.
By proactively planning for different
contingencies, organizations can
minimize the impact of disruptions
and maintain continuity in their
supply chain operations.
By following this comprehensive
management approach, organizations
can effectively identify, assess, and
mitigate risks within their supply chain,
enhancing resilience and ensuring

29. A complex adaptive
logistics system
(CALS)
▶ A complex adaptive logistics
system (CALS) is a framework for
understanding and managing
logistics processes within a
dynamic and unpredictable
environment. It draws upon
principles from complexity theory
and adaptive systems to address
the challenges of modern supply
chains, which are characterized
by interconnectedness,
uncertainty, and rapid change.
By adopting a complex adaptive
logistics system approach,
organizations can better
understand the dynamics of
modern supply chains and
develop strategies to improve
resilience, flexibility, and

30. A complex adaptive
logistics system
(CALS)
▶ Key features of a complex adaptive
logistics system include:
• Interconnectedness: CALS recognizes
that logistics processes are highly
interconnected, with various elements of
the supply chain influencing and
interacting with each other. Changes in
one part of the system can have ripple
effects throughout the entire network.
Therefore, it's essential to understand the
complex relationships and dependencies
within the logistics system.
• Emergence: CALS acknowledges that
complex behaviors and patterns can
emerge from the interactions between
individual components of the logistics
system. These emergent properties are
often unpredictable and may not be
directly attributable to any single factor.
By studying emergent phenomena, such
as demand fluctuations or traffic
congestion, organizations can gain

31. A complex adaptive
logistics system
(CALS)
• Nonlinear Dynamics: CALS
acknowledges that logistics systems often
exhibit nonlinear dynamics, where small
changes in input can lead to
disproportionately large effects on output.
This can manifest as phenomena such as
the bullwhip effect, where small
fluctuations in demand are amplified as
they propagate upstream through the
supply chain. Understanding nonlinear
dynamics is essential for managing and
mitigating the effects of volatility and
uncertainty in logistics systems.
• Information Flow: Information plays a
critical role in CALS, facilitating
coordination, decision-making, and
adaptation within the logistics system.
Real-time data on inventory levels,
transportation schedules, and customer
preferences enable organizations to
respond quickly to changing conditions
and optimize resource allocation. Effective
information flow is essential for enhancing

32. A complex adaptive
logistics system
(CALS)
• Continuous Learning and
Improvement: CALS emphasizes
the importance of continuous
learning and improvement to
enhance the performance of the
logistics system over time. By
monitoring system behavior,
analyzing performance metrics, and
experimenting with new approaches,
organizations can identify
opportunities for optimization and
innovation. Continuous learning
enables logistics systems to evolve
and adapt in response to changing
market dynamics and emerging
challenges.
By adopting a complex adaptive
logistics system approach, organizations
can better understand the dynamics of
modern supply chains and develop

33. Traceability Concept
▶ Traceability is the ability to track
and trace the movement of
products or components
throughout the supply chain, from
their origin to their final
destination. It involves capturing
and recording information about
the production, processing,
distribution, and sale of goods,
allowing for visibility and
transparency at each stage of the
supply chain.
Overall, traceability is a critical
concept in supply chain
management, enabling
organizations to improve
efficiency, accountability, and
sustainability while ensuring
product safety, quality, and
compliance with regulatory
requirements. By implementing
robust traceability systems and

34. Traceability Concept
▶ Key concepts and components of
traceability include:
• Unique Identification: Each
product or component in the
supply chain is assigned a unique
identifier, such as a serial number,
barcode, or RFID tag. This
identifier is used to track the item
as it moves through the supply
chain, enabling its identification
and traceability at each stage.
• Data Capture and Recording:
Relevant information about the
product, including its origin,
production date, batch or lot
number, and other attributes, is
captured and recorded at various
points in the supply chain. This
data may be collected manually or
automatically using technologies
such as scanners, sensors, and

35. Traceability Concept
• Information Sharing and
Visibility: Traceability involves
sharing information about product
movement and status with
stakeholders across the supply
chain, including suppliers,
manufacturers, distributors,
retailers, and consumers. Real-
time visibility into the location,
condition, and history of products
enables better decision-making,
risk management, and
collaboration among supply chain
partners.
• Regulatory Compliance:
Traceability is often mandated by
regulations and standards to
ensure product safety, quality,
and compliance with legal
requirements. For example, in
industries such as food and
pharmaceuticals, regulations may

36. Traceability Concept
• Supply Chain Integrity and Risk
Management: Traceability helps
to ensure the integrity of the
supply chain by detecting and
preventing counterfeiting,
diversion, and unauthorized
tampering of products. It also
enables proactive risk
management by identifying and
mitigating potential issues, such as
supply chain disruptions, quality
defects, and ethical concerns.
• Quality Assurance and Recall
Management: Traceability
systems support quality assurance
processes by enabling the rapid
identification and resolution of
quality issues or non-conformities.
In the event of a product recall or
safety alert, traceability data allows
for targeted and efficient recall
management, minimizing the

37. Traceability Concept
• Consumer Transparency and
Trust: Traceability provides
consumers with transparency into
the origin, production methods, and
attributes of products, allowing them
to make informed purchasing
decisions based on factors such as
sustainability, ethical sourcing, and
product authenticity. Enhanced
transparency builds trust and loyalty
among consumers, who increasingly
value visibility and accountability in
the products they purchase.
Overall, traceability is a critical concept
in supply chain management, enabling
organizations to improve efficiency,
accountability, and sustainability while
ensuring product safety, quality, and
compliance with regulatory
requirements. By implementing robust
traceability systems and processes,
companies can enhance visibility,
mitigate risks, and create value across

38. Critical Infrastructure
▶ Critical infrastructures refer
to the physical and cyber
systems, networks, and
assets that are essential for
the functioning of a society
and economy. These
infrastructures provide the
necessary services and
resources that support the
daily operations of
businesses, governments,
and individuals. Critical
infrastructures are vital for
national security, public
safety, economic stability,
and societal well-being.

39. Critical Infrastructure
▶ Infrastructures creates
dependencies and vulnerabilities,
making them susceptible to
various risks and threats,
including natural disasters,
cyberattacks, terrorism,
pandemics, and geopolitical
tensions. Ensuring the resilience,
reliability, and security of critical
infrastructures is essential for
safeguarding national interests,
mitigating risks, and maintaining
societal functions in the face of
challenges and disruptions.
Consequently, governments,
businesses, and organizations
invest in risk management,
contingency planning,
cybersecurity measures, and
infrastructure resilience initiatives
to protect critical infrastructures
and enhance their ability to
withstand and recover from

40. Critical Infrastructure
▶ Examples of critical infrastructures
include:
• Energy: This includes power
generation, transmission, and
distribution systems, as well as oil
and gas pipelines. Reliable and
resilient energy infrastructure is
essential for maintaining essential
services, such as lighting, heating,
transportation, and
communication.
• Transportation: Critical
transportation infrastructures
include roads, bridges, airports,
seaports, railways, and public
transit systems. These
infrastructures facilitate the
movement of people and goods,
supporting economic activity,
trade, and mobility.

41. Critical Infrastructure
• Water and Wastewater: Water
supply and wastewater treatment
systems are critical for public
health, sanitation, and
environmental protection. These
infrastructures ensure access to
safe and clean drinking water
and manage the disposal of
wastewater and sewage.
• Communication:
Communication infrastructures,
including telecommunications
networks, internet infrastructure,
and satellite systems, enable
the exchange of information,
data, and communication
services. These infrastructures
support business operations,
emergency response, and social
connectivity.

42. Critical Infrastructure
• Finance: Financial
infrastructures encompass
banking systems, stock
exchanges, payment networks,
and financial institutions.
These infrastructures facilitate
economic transactions,
investment, and financial
services, underpinning
economic growth and stability.
• Healthcare: Healthcare
infrastructures include
hospitals, clinics, medical
facilities, and public health
systems. These infrastructures
provide essential healthcare
services, medical treatment,
and emergency response
capabilities to support public

43. Critical Infrastructure
• Government: Government
infrastructures, such as
government buildings,
administrative facilities, and
public institutions, support
governance, public
administration, law
enforcement, and emergency
management functions.
• Defense and Security:
Defense and security
infrastructures encompass
military installations, defense
networks, intelligence
agencies, and law enforcement
agencies. These
infrastructures protect national
sovereignty, deter threats, and
ensure public safety and

44. Departmental Security
Measures
▶ Departmental security measures
refer to the policies, procedures,
and practices implemented within
specific departments or units of
an organization to safeguard
sensitive information, assets, and
resources. These measures are
designed to mitigate risks,
protect against unauthorized
access, and ensure the
confidentiality, integrity, and
availability of departmental data
and operations.
By implementing these
departmental security measures,
organizations can strengthen
their overall security posture,
protect critical assets, and
mitigate risks associated with
unauthorized access, data

45. Departmental Security
Measures
▶ Here are some common
departmental security measures:
• Access Control: Implementing
access control mechanisms to
restrict access to departmental
resources based on the principle of
least privilege. This may include
user authentication, authorization,
and role-based access control
(RBAC) to ensure that only
authorized personnel can access
sensitive information and systems.
• Physical Security: Securing
physical access to departmental
facilities, equipment, and storage
areas through measures such as
access badges, locks, surveillance
cameras, and security guards.
Physical security measures help
prevent unauthorized entry, theft,

46. Departmental Security
Measures
• Information Security Policies:
Developing and enforcing
departmental information security
policies and procedures that
outline acceptable use, data
classification, handling
procedures, and security best
practices. These policies help
raise awareness, set expectations,
and establish guidelines for
protecting departmental
information assets.
• Data Encryption: Encrypting
sensitive data stored on
departmental systems, devices,
and communication channels to
prevent unauthorized access or
interception. Encryption
technologies, such as Transport
Layer Security (TLS), secure

47. Departmental Security
Measures
• Security Awareness Training:
Providing security awareness
training and education to
departmental employees to
promote a culture of security and
ensure compliance with security
policies and practices. Training
topics may include phishing
awareness, password security,
social engineering, and incident
reporting procedures.
• Endpoint Security: Implementing
endpoint security measures, such
as antivirus software, firewalls,
intrusion detection/prevention
systems (IDS/IPS), and endpoint
encryption, to protect departmental
devices (e.g., computers, laptops,
mobile devices) from malware,
unauthorized access, and other

48. Departmental Security
Measures
• Secure Communication: Using
secure communication protocols
and technologies, such as virtual
private networks (VPNs),
encrypted email, and secure
messaging platforms, to protect
sensitive information transmitted
within and outside the
department.
• Incident Response Plan:
Developing and maintaining an
incident response plan to
effectively respond to security
incidents, breaches, or violations
within the department. The plan
should outline procedures for
incident detection, containment,
investigation, and recovery to
minimize the impact on
departmental operations and

49. Departmental Security
Measures
• Regular Audits and
Assessments: Conducting
regular security audits,
assessments, and compliance
checks to evaluate the
effectiveness of departmental
security measures, identify
vulnerabilities, and address gaps
in security controls.
• Vendor Management:
Implementing security measures
for third-party vendors,
contractors, and service
providers who have access to
departmental systems or data.
This may include conducting
security assessments,
establishing contractual security
requirements, and monitoring

50. Departmental Security
Measures
▶ Disruptions in operating processes
refer to conditions or events that
deviate from the original plan and
can result in partial or complete
interruptions of normal business
operations.
Effective management of disruptions
requires organizations to implement
risk management strategies,
contingency plans, and resilience
measures to anticipate, mitigate,
and respond to potential disruptions.
This may include developing
alternative supply chain routes,
implementing redundant systems,
investing in disaster recovery
capabilities, and enhancing
communication and collaboration
with stakeholders. By proactively
addressing disruptions,
organizations can minimize their
impact on operations and maintain

51. Departmental Security
Measures
▶ These disruptions can occur due
to a wide range of factors,
including:
• Natural Disasters: Events such
as earthquakes, floods,
hurricanes, tornadoes, wildfires,
and severe weather conditions
can disrupt operations by
damaging infrastructure,
disrupting supply chains, and
causing power outages or
communication failures.
• Man-Made Disasters: Incidents
such as industrial accidents,
fires, chemical spills, explosions,
terrorist attacks, and
cyberattacks can disrupt
operations by causing physical

52. Departmental Security
Measures
• Supply Chain Disruptions:
Issues such as supplier
failures, material shortages,
transportation delays,
customs delays, or
geopolitical conflicts can
disrupt the supply chain,
leading to disruptions in
production, inventory
shortages, or delivery delays.
• Technological Failures:
Failures or malfunctions of
equipment, machinery,
software systems, or IT
infrastructure can disrupt
operations, leading to
downtime, data loss, or

53. Departmental Security
Measures
• Human Factors: Human
errors, accidents, labor
strikes, protests, or workforce
shortages can disrupt
operations by affecting
productivity, safety, or morale
within the organization.
• Regulatory Compliance
Issues: Changes in
regulations, compliance
requirements, or legal issues
can disrupt operations by
requiring adjustments to
processes, procedures, or
product offerings to ensure
compliance.

54. Departmental Security
Measures
• Market Changes: Shifts in
market demand, consumer
preferences, competition, or
economic conditions can
disrupt operations by
affecting sales volumes,
pricing strategies, or market
positioning.
• Health Emergencies: Events
such as pandemics,
epidemics, or public health
crises can disrupt operations
by causing employee
absenteeism, supply chain
disruptions, or restrictions on
business activities.

55. Departmental Security
Measures
• Environmental Factors:
Environmental factors such
as pollution, climate change,
natural resource depletion, or
sustainability concerns can
disrupt operations by
affecting resource availability,
regulatory requirements, or
stakeholder expectations.
• Geopolitical Events: Events
such as wars, conflicts, trade
disputes, or political instability
in regions where the
organization operates can
disrupt operations by
affecting supply chain
logistics, market access, or

56. Continuity of Supply
▶ Ensuring the continuity of supply
while maximizing profitability are
primary goals across various
corporate disciplines such as
procurement, logistics, production,
and distribution. Here's how each
discipline contributes to achieving
these goals:
• Procurement: Procurement
focuses on acquiring goods and
services from external suppliers. To
ensure continuity of supply,
procurement professionals work to
establish strong supplier
relationships, diversify the supplier
base, and implement risk
management strategies to mitigate
supply chain disruptions. At the
same time, procurement aims to
maximize profitability by negotiating
favorable terms, reducing costs
through bulk purchasing or

57. Continuity of Supply
• Logistics: Logistics involves the
management of the flow of goods,
information, and resources throughout
the supply chain. To ensure continuity
of supply, logistics professionals focus
on efficient transportation, warehousing,
inventory management, and distribution
to minimize disruptions and ensure
timely delivery of products to customers.
Additionally, logistics aims to maximize
profitability by optimizing transportation
routes, reducing lead times, minimizing
inventory carrying costs, and improving
overall supply chain efficiency.
• Production: Production encompasses
the manufacturing or assembly of goods
from raw materials or components. To
ensure continuity of supply, production
managers focus on maintaining efficient
production processes, optimizing
capacity utilization, and managing
inventory levels to meet demand
fluctuations. At the same time,
production aims to maximize profitability
by improving productivity, reducing
waste, minimizing production costs, and

58. Continuity of Supply
• Distribution: Distribution involves the
movement of finished goods from
production facilities to customers or
end-users. To ensure continuity of
supply, distribution managers focus on
optimizing distribution networks,
managing transportation logistics, and
implementing inventory management
systems to ensure products are
available when and where they are
needed. Additionally, distribution aims
to maximize profitability by reducing
distribution costs, improving order
fulfillment processes, and enhancing
customer service and satisfaction.
Overall, these corporate disciplines work
together to ensure the continuity of supply
while maximizing profitability by aligning
their strategies, processes, and activities to
achieve common goals. By effectively
managing their respective functions and
collaborating across the supply chain,
organizations can enhance resilience,
efficiency, and competitiveness in the
marketplace.

59. Distribution Centers
▶ Distribution centers indeed face a
heightened risk of theft due to the
high volume of valuable goods
passing through them, making them
attractive targets for theft and
pilferage. Here are some reasons
why distribution centers are
particularly vulnerable to theft:
• Large Inventory: Distribution
centers typically store large
quantities of inventory, including
valuable goods such as electronics,
apparel, pharmaceuticals, and
consumer goods. The sheer volume
of inventory increases the potential
payoff for thieves.
• High-Value Goods: Many of the
products stored in distribution
centers are high-value items that are
easy to sell on the black market.
This makes distribution centers
attractive targets for organized crime

60. Distribution Centers
• Complexity of Operations:
Distribution centers often have
complex operations involving multiple
stages of receiving, storing, picking,
packing, and shipping goods. The
complexity of these operations can
create opportunities for theft to occur
unnoticed.
• Transient Workforce: Distribution
centers often employ a large number
of temporary or seasonal workers,
including temporary agency staff and
subcontractors. The transient nature
of the workforce can make it
challenging to establish trust and
accountability among employees,
increasing the risk of insider theft.
• Remote Locations: Distribution
centers are often located in remote or
industrial areas, making them less
visible and more vulnerable to theft.
Remote locations can also make it
difficult for law enforcement to

61. Distribution Centers
• Limited Security Measures:
While some distribution centers
have robust security measures in
place, others may have limited
security infrastructure, such as
surveillance cameras, access
controls, and security personnel.
Inadequate security measures
can make it easier for thieves to
gain access to the facility and
steal goods.
• Supply Chain Vulnerabilities:
Theft can occur at various points
in the supply chain, including
during transportation to and from
the distribution center.
Vulnerabilities in the supply
chain, such as unsecured cargo
or lack of tracking mechanisms,
can increase the risk of theft.

62. Distribution Centers
▶ To mitigate the risk of theft at
distribution centers, organizations can
implement various security measures
and best practices, including:
• Security Personnel: Employing security
guards or personnel to monitor access
points, patrol the facility, and respond to
security incidents.
• Surveillance Systems: Installing
surveillance cameras and alarm
systems to monitor activity both inside
and outside the distribution center.
• Access Controls: Implementing access
control measures such as key card
systems, biometric scanners, and
fencing to restrict entry to authorized
personnel only.
• Inventory Management: Implementing
inventory management systems with
barcoding, RFID technology, and real-
time tracking to monitor inventory levels
and detect discrepancies.

63. Distribution Centers
• Employee Training: Providing
training and awareness programs to
educate employees about security
risks, theft prevention strategies,
and reporting procedures.
• Background Checks: Conducting
background checks and screening
procedures for all employees,
contractors, and temporary workers
to reduce the risk of insider theft.
• Collaboration with Law
Enforcement: Establishing
partnerships with local law
enforcement agencies to report
incidents, share information, and
coordinate responses to security
threats.
By implementing these security
measures and adopting a proactive
approach to theft prevention, distribution
centers can reduce their vulnerability to

64. Hybrid Threats and
Supply Chain Safety
Management
▶ Hybrid threats and supply
chain safety management
are two distinct but
interconnected concepts that
relate to security and risk
management in various
domains, including
geopolitics, cybersecurity,
and business operations.

65. Hybrid Threats and
Supply Chain Safety
Management
▶ Hybrid Threats:
Hybrid threats refer to a
combination of conventional and
non-conventional tactics used
by state or non-state actors to
achieve their objectives. These
threats often blur the lines
between different forms of
warfare, such as conventional
military actions, cyber attacks,
information warfare, economic
coercion, and political
subversion. Hybrid threats
leverage multiple dimensions
simultaneously, making them
difficult to attribute and respond
to.

66. Hybrid Threats and
Supply Chain Safety
Management
▶ Key characteristics of hybrid
threats include:
• Multi-Domain Approach: Hybrid
threats operate across multiple
domains, including military,
economic, political, and
informational, to create confusion
and exploit vulnerabilities.
• Ambiguity: The use of multiple
tactics and actors often creates
ambiguity, making it challenging
to identify the responsible party
and appropriate response.
• Deniability: Perpetrators of
hybrid threats may attempt to
distance themselves from their
actions to avoid direct
confrontation.

67. Hybrid Threats and
Supply Chain Safety
Management
▶ Key characteristics of hybrid
threats include:
• Information Manipulation:
Information warfare plays a
crucial role, using disinformation,
propaganda, and media
manipulation to shape public
perception and influence
decision-making.
• Asymmetric Strategies: Hybrid
threats often involve weaker
actors exploiting the strengths
and vulnerabilities of stronger
opponents.
• Complexity: The interconnected
nature of hybrid threats requires
comprehensive and adaptable
responses that encompass
various domains.

68. Hybrid Threats and
Supply Chain Safety
Management
▶ Supply Chain Safety
Management:
Supply chain safety
management involves ensuring
the security, resilience, and
integrity of supply chains to
prevent disruptions and mitigate
risks. This concept is vital for
both public and private sectors,
as supply chains are susceptible
to various threats, including
natural disasters, cyber attacks,
geopolitical tensions, and even
hybrid threats.

69. Hybrid Threats and
Supply Chain Safety
Management
▶ Key aspects of supply chain safety
management include:
• Risk Assessment: Identifying and
assessing potential risks and
vulnerabilities within the supply chain,
considering factors such as suppliers,
transportation, production, and
distribution.
• Resilience Planning: Developing
strategies to minimize the impact of
disruptions, including having backup
suppliers, diversified sourcing, and
robust contingency plans.
• Security Measures: Implementing
cybersecurity protocols, access
controls, and other security measures
to protect digital components of the
supply chain from cyber attacks.
• Transparency and Traceability:
Ensuring transparency and traceability
throughout the supply chain to identify
and address potential issues quickly.

70. Hybrid Threats and
Supply Chain Safety
Management
▶ Key aspects of supply chain safety
management include:
• Collaboration: Collaborating with
suppliers, partners, and
stakeholders to share information,
best practices, and resources to
collectively enhance supply chain
safety.
• Regulatory Compliance:
Adhering to relevant regulations
and standards related to supply
chain safety and data protection.
• Continuous Monitoring and
Improvement: Regularly
monitoring the supply chain,
conducting audits, and refining
safety measures based on
emerging risks and changing
circumstances.

71. Hybrid Threats and
Supply Chain Safety
Management
▶ The term HYBRID THREAT, came of
age during the global war on terrorism
that still plays its rough sport today.
Hybrid Threat is used to define threats
that combine both regular and irregular
forces and all other criminal forces all
unified to achieve a mutual goal. Hybrid
threats when used, shows the multiplicity
of different actors and how complex a
conflict especially in this era can be.
Hybrid Threat in supply chain
management, is completely different from
the counter-terrorism hybrid threat that we
all know; however, they both share similar
definitive roots. Over the years,
specialists and analysts in supply chain
risk management have used regular
actors such as hurricanes and all other
forms of natural and man-made disasters
to challenge supply chain risk mitigating
strategies and planning designs.

72. Hybrid Threats and
Supply Chain Safety
Management
▶ There are other regular actors
that threaten most
organization’s supply chains;
some of these threats are:
regional conflicts and foreseen
geo-political landscape
alongside socio-economic
issues. These and many more
are some of the regular actors
that most supply chains have to
endure to get goods and
services from point of origin to
their intended destination.

73. Hybrid Threats and
Supply Chain Safety
Management
▶ In the last 2-3 years, we have witnessed
series of actors or supply chain
adversaries that have simultaneously and
adaptively employed a fused mix of both
regular and irregular threats to disrupt
global, regional and national supply chains
knowingly and unknowingly. Cyberattack
on Maersk which was estimated to cost the
company as much $300 million, Qatar
blockade due to alleged terrorism support,
Brexit, increased ISIS attacks, increased
disputes in international law and
governance, challenge to globalization in
the rise of populism ideology, increase in
maritime disputes, threat to free trade,
NAFTA in limbo, migration issue in Europe
and series of political and economic
uncertainties. All of this mention are just
some miscellany of already existing threats
and new irregular/unconventional threats
that reflect significant impact on movement
of goods and services globally.

74. Hybrid Threats and
Supply Chain Safety
Management
▶ The rise in hybrid threats, shows that
supply chain risk management
framework for all organizations must be
continuously redefined to meet the ever
changing and dynamic vulnerabilities
and threats that works against it daily. It
is one thing for supply chain to build
resiliency in order to efficiently aid the
absorption of some of these threats
which may be inevitable, and it is
another thing to fight against it.
Any supply chain that wants to compete
in the future must have a chain that is
resilient and that can attack some of
these threats as being defensive is not
sufficient to subdue some of these
threats. Proliferation of advanced
technologies and supply chain reliability
are high risk areas that are prone to
attacks as we move into the supply

75. Hybrid Threats and
Supply Chain Safety
Management
▶ The future of supply chain, shows
heavy reliance on digital footprint and
cyber technologies and this will be areas
of interest for different supply chain
adversaries whoever they may be.
Organizations vulnerabilities are being
exploited daily and most organizations
are not equipped to deal with the
aftermath. An attack on an organization
has a direct impact on the product and
services value as well as its supply
chain. Globalization has facilitated the
long supply chain we experience today
and the longer the chain, the more
complex it is and the more susceptible it
becomes. If product A is manufactured
in Country X for consumption in Country
B, Country Y is not friendly with Country
B but friendly with Country X. Don’t be
surprised if you find your supply chain
be attacked by Country Y.

76. Hybrid Threats and
Supply Chain Safety
Management
▶ Since the inception of supply chain
management into the business world,
the modus operandi has been to take
defensive tactics or modes of operation
in aligning themselves within
organizations that address supply chain
risk management. This defensive
operating mind set can be attributed to
how supply chain management came to
being in the business world. A lot of
organizations still do not see supply
chain management as a functional part
of an organization. Today, we are finally
seeing C level positions in a lot of
organizations who address supply chain
management as a core functional part of
its organization. There are still a lot of
organizations out there who are still
lumping supply chain management with
other functional areas within the
organization.

77. Hybrid Threats and
Supply Chain Safety
Management
▶ It is this history of slow integration and
lack of recognition of supply chain
management function within an organization
that has hampered the ability of supply chain
risk managers to mitigate future threats. One
of the main defensive tactics of supply chain
management should be in its reliance on
other functional areas of the organization
before acting. A lot of supply chain systems
are reactionary in nature and with that,
defensive mode of operation is the only
feasible way to operate. It will be extremely
difficult to have an offensive mindset in a
reactionary mode of operation.
The threats to the future of supply chain can
only be challenged with combo of offensive
and defensive approaches. Some
organizations are already on the defensive
and offensive mode of operation while some
don’t see the reason to be. This operational
mindset will determine the competitiveness
of organizations in the future.

78. Hybrid Threats and
Supply Chain Safety
Management
▶ We should ask ourselves this “what
does it mean to be offensive oriented in
your supply chain management?” the
answer is simple really; an offensive
approach in the supply chain
management context is always looking
for ways to position an organization
through supply chain management to
project power; they do this by always
looking for ways to be innovative and
counter any perceive weak point before
being exploited. Every supply chain
has a weak link, ability to protect and
defend the weak link is the difference
maker. An offensive approach will not
be reliant on other core business
functions within the organization and
most importantly, an offensive
approach seeks out ways to
understand and approach challenges

79. Hybrid Threats and
Supply Chain Safety
Management
▶ The future of supply chain is dense on cyber
technology and with that comes hybrid threats
and challenges which cannot be combated with
todays mitigating strategies. As the population
increases around the world, despite the
populism movement and its protectionist ideas, I
do not see how populism is set to impact the
future of supply chain rather than being an
irregular force. Supply Chain of services and
products will become more complex and human
wants more insatiable, and that is why the need
for supply chain risk managers to be more
proactive and be offensive oriented in their
approach is now.
Recenlty, we learnt that 57 million Uber drivers
and riders information were hacked last year
and this is just of the few reported hacks that
affected related consumers. The traditional
supplier mapping against an overlay of geo-
cultural/political landscapes to determine
propensity of traditional supply chain threats
due to historic events will not be enough to
position any supply chain to challenge any
dynamic hybrid threats that would spring up in

80. Hybrid Threats and
Supply Chain Safety
Management
▶ Risk assessment and risk management for
hybrid threats are not same as the traditional
threats we have faced before. These
unprecedented mixtures of non-state actors in
terms of threats to the supply chain will continue
to increase in the future, so long as the increase
in demographic shifts continues thereby
encouraging more reliance on resource scarcity.
With these new changes in what is expected of
supply chain of the future in respect to hybrid
threats, supply chain professionals must equip
themselves with additional set of skills to be
able to drive value in making their supply chains
ready for the future and in a bid to further build
and strengthen supply chain resiliency. Supply
Chain professionals are encouraged to seek
new knowledge in areas of economics and
trade, national and international policies, data
mining and data analytics, digital supply chains,
programming and coding to a large extent and
most importantly having a deep understanding
of their own geo-political landscape how it
affects their suppliers and vice versa.

81. Hybrid Threats and
Supply Chain Safety
Management
▶ As the future of supply chain is set to
embrace the use of block-chain
technology, internet of things, machine
learning and all its derivatives, the question
we should be prepared to answer are,
“How are different organization getting their
supply chain ready for the different
vulnerabilities that comes with these new
technologies?, Are proper risk assessment
done to gauge the threat level associated
with supply chain future?, Are the supply
chain professionals within the
organizations equipped to face challenges
that comes with dealing with supply chain
of the future?, Are the risks worth the
effort?, What type of risks are
organizations willing to tackle offensively?,
Is the current supply chain resilient enough
to be defensive?, What is the cost of
allowing some of these threats to fall
through?” These and many other questions
should be raised as organizations prepare

82. Hybrid Threats and
Supply Chain Safety
Management
▶ There is no template or
cookie cutter approach to
designing a resilient supply
chain as every organization is
different. A high-risk threat to
Company A might be extremely
low risk threat to that of
Company B. Asking the right
questions and equipping
professionals with necessary
tools to aid the identification,
and designing of a supply chain
that fully understands and takes
into account the dynamic
environment with the best
interest of all its stakeholders at
heart.

83. Hybrid Threats and
Supply Chain Safety
Management
▶ In summary, hybrid threats
introduce a complex and multi-
dimensional security challenge,
while supply chain safety
management addresses the
need to secure critical
processes and systems against
a range of risks, including hybrid
threats. Given the interplay
between these two concepts,
organizations must consider
both when developing
comprehensive security and risk
management strategies.

84. Self-healing Processes
▶ Self-healing processes in the context
of supply chain risk management
refer to the ability of a supply chain
system to autonomously detect,
respond to, and recover from
disruptions or disturbances without
the need for external intervention.
These processes leverage
technologies, adaptive strategies, and
resilience mechanisms to minimize
the impact of disruptions and ensure
continuity of operations. levels and
detect discrepancies.
Overall, self-healing processes play a
critical role in enhancing the
resilience and agility of supply chain
operations by enabling autonomous
detection, response, and recovery
from disruptions. By leveraging
advanced technologies, data-driven
insights, and adaptive strategies,
organizations can strengthen their
ability to withstand and recover from
unforeseen events, ensuring

85. Self-healing Processes
• Predictive Analytics and Decision
Support: Self-healing processes use
predictive analytics and decision
support tools to anticipate potential
disruptions and assess their potential
impact on the supply chain. By
analyzing historical data, simulating
different scenarios, and applying
predictive models, these processes can
forecast the likelihood and severity of
disruptions, allowing organizations to
proactively implement mitigation
measures and contingency plans.
• Dynamic Adaptation and Resilience:
Self-healing processes enable supply
chains to dynamically adapt and
reconfigure their operations in
response to disruptions. This may
involve automatically rerouting
shipments, reallocating resources,
adjusting production schedules, or
activating alternative suppliers or
distribution channels. By building
flexibility and redundancy into supply
chain networks, self-healing processes

86. Self-healing Processes
• Automated Response and Recovery:
Self-healing processes automate
response and recovery actions to
minimize downtime and mitigate the
impact of disruptions. This may include
triggering automated alerts and
notifications, initiating predefined
recovery plans, and coordinating
response efforts across multiple
stakeholders. Automated response
mechanisms help streamline decision-
making, reduce human error, and
accelerate recovery efforts, ensuring
timely restoration of normal operations.
• Learning and Continuous
Improvement: Self-healing processes
facilitate learning and continuous
improvement by capturing lessons
learned from past disruptions and
incorporating feedback into future risk
management strategies. By analyzing
the effectiveness of response
measures and identifying areas for
improvement, organizations can
enhance the resilience and

87. Rare Earths
▶ Illegal mining of rare
earths refers to the
unauthorized extraction,
production, and trade of rare
earth minerals without proper
permits or adherence to
environmental regulations
and labor standards. Rare
earth minerals are a group of
17 elements that are
essential for various high-
tech applications, including
electronics, renewable
energy technologies, and
defense systems. It is NOT
responsible for almost half of
the world’s supply in rare

88. Rare Earths
▶ Illegal mining of rare earths poses
several environmental, social, and
economic risks:
• Environmental Damage: Illegal
mining of rare earths often involves
environmentally destructive
practices, such as deforestation, land
degradation, water pollution, and
habitat destruction. Improper waste
disposal, toxic chemicals, and
unregulated extraction methods can
contaminate soil, waterways, and
ecosystems, leading to long-term
environmental degradation and loss
of biodiversity.
• Resource Depletion: Illegal mining
can contribute to the depletion of rare
earth resources by exploiting
deposits without proper management
or conservation measures in place.
This can accelerate the depletion of
finite resources, undermine

89. Rare Earths
• Labor Exploitation: Illegal mining
operations may engage in
exploitative labor practices,
including child labor, forced labor,
and unsafe working conditions.
Miners, often operating in informal
or unregulated settings, may lack
proper protective equipment,
training, or legal protections,
leading to hazardous working
conditions and human rights
abuses.
• Economic Losses: Illegal mining
undermines formal mining
operations and government
revenues by avoiding taxes,
royalties, and licensing fees. It
creates unfair competition for
legitimate businesses and disrupts
the functioning of legal supply
chains, leading to economic losses
for governments, companies, and

90. Rare Earths
• Social Conflict: Illegal mining can
contribute to social tensions,
conflict, and insecurity in affected
communities. Competition for
scarce resources, disputes over
land rights, and conflicts with law
enforcement or other stakeholders
can escalate into violence, social
unrest, and instability, undermining
peace and security in the region.
• Supply Chain Risks: Illegal rare
earths may enter global supply
chains, posing risks to companies
and consumers who unknowingly
purchase products containing
illegally sourced minerals. This can
expose companies to reputational
damage, regulatory scrutiny, and
legal liabilities, particularly in regions
with strict regulations on responsible
mineral sourcing, such as the
European Union's Conflict Minerals
Regulation or the U.S. Dodd-Frank

91. Rare Earths
▶ Addressing illegal mining of rare
earths requires coordinated efforts
from governments, industry
stakeholders, civil society
organizations, and local
communities to strengthen
governance, enforce regulations,
and promote responsible sourcing
practices. This includes
implementing measures such as
stricter law enforcement,
transparency and traceability
mechanisms, certification schemes,
and initiatives to support
sustainable mining practices and
community development in affected
areas. By addressing the root
causes of illegal mining and
promoting responsible sourcing,
stakeholders can mitigate the
negative impacts of illegal rare

92. Buyer Market
Economies
▶ In buyer market economies with
limited product or brand loyalty, product
unavailability can indeed immediately
result in lower sales. In such economies,
consumers have a wide range of
choices and are more likely to switch
between brands or products based on
availability, price, or convenience.
Here's how product unavailability can
impact sales in such economies:
• Lost Sales Opportunities: When a
product is unavailable, consumers
may choose to purchase a substitute
product from a competitor instead. In
a buyer market economy, where
consumers have limited brand
loyalty, they are more willing to
switch to alternative brands or
products that meet their needs. As a
result, the company experiencing
product unavailability may lose sales
opportunities to competitors.

93. Buyer Market
Economies
• Negative Impact on Brand
Image: Product unavailability can
damage the brand image and
reputation of the company,
especially if it occurs frequently or
for extended periods. Consumers
may perceive the brand as
unreliable or untrustworthy,
leading to a loss of confidence
and loyalty among existing
customers and potential
customers.
• Reduced Customer
Satisfaction: Product
unavailability can lead to
dissatisfaction among customers
who are unable to purchase their
desired products when needed.
This can result in negative word-
of-mouth, complaints, and

94. Buyer Market
Economies
• Impact on Revenue and
Profitability: Lower sales due to
product unavailability can directly
impact revenue and profitability for
the company. Missed sales
opportunities and reduced customer
demand can result in lower revenue
and decreased profitability,
particularly if the company fails to
address the underlying issues
causing the unavailability of
products.
• Opportunity for Competitors:
Product unavailability creates an
opportunity for competitors to gain
market share by offering alternative
products or capturing customers
who are dissatisfied with the
unavailable product. Competitors
may capitalize on the situation by
aggressively promoting their

95. Buyer Market
Economies
▶ To mitigate the negative impact of
product unavailability in buyer market
economies with limited product or brand
loyalty, companies can take several
proactive measures:
• Improve Supply Chain
Management: Enhance supply chain
efficiency and visibility to ensure
adequate inventory levels and timely
replenishment of products.
• Diversify Suppliers and
Distribution Channels: Reduce
reliance on a single supplier or
distribution channel to minimize the
risk of supply chain disruptions and
product shortages.
• Forecasting and Demand
Planning: Use data analytics and
demand forecasting techniques to
anticipate customer demand and

96. Buyer Market
Economies
• Communication and
Transparency: Keep customers
informed about product
availability, backorders, and
expected delivery dates to
manage expectations and
maintain trust.
• Invest in Inventory
Management Systems:
Implement inventory management
systems and technologies to track
inventory levels, monitor demand
trends, and optimize inventory
replenishment processes.
By implementing these measures,
companies can mitigate the impact
of product unavailability, maintain
customer satisfaction, and preserve
market share in buyer market

98. Supply Chain Issues Heading
Into 2023