The impact of implementing CSI and C-TPAT security initiatives on Supply Chain : Adding Value to the Supply Chain

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  • 1. The impacts ofCSI and C-TPAT security initiatives on supply chain: Adding value to the supply chain Presented By: Ziyad Alharbi 3 rdyear undergraduate student

2. Overview

  • Maritime security background
  • Container security initiative (CSI)
  • US Customs-Trade Partnership against Terrorism (C-TPAT )
  • Impact of CSI and C-TPAT on Supply Chain Management
  • Security adds value to the supply chain
  • Conclusion

3. Maritime security background

  • Many factors could raise the awareness of security threats in the maritime supply chain:
    • O pen nature nationally and globally
    • Complexity
    • Important forglobal trade

4. Container Security Initiative (CSI)

  • Strategic program developed by
  • US Customs after the events of
  • September 11, 2001
  • 24 hour rule
    • requires ocean container carriers to send a manifest to US Customs authorities that includes detailed information about container cargo at least 24 hours prior departure from foreign ports.
    • requires containers bound to US to be scanned 24h prior loading onboard vessel

5. USCustoms-Trade Partnership against Terrorism (C-TPAT)

  • Objective:
  • For businesses participating
  • in the supply chain to partner
  • with U.S Customs in order to
  • improve security throughout
  • the supply chain and to ensure
  • container integrity all the way
  • to the origin of shipper

6. Scope of IMO and US Maritime Security Initiatives across a Supply Chain 7. Impact on supply chain(Efficiency)

  • Negative
    • Delays and congestion
    • Increased transit time
    • Higher inventory levels
    • Higher transportation costs

8. Efficiency (cont)

  • Positive
    • Early reporting
    • Reduced time to resolve documentation issue
    • Time sensitive operations
    • Cargo availability

9. Impact on supply chain(cost)

  • Negative
    • High technological investments
    • Expertise and manpower
  • Positive
    • Accurate info exchange
    • Early reporting
    • Increase service and documentation reliability
    • Reduced errors and service variability
    • Avoid compensation cost (Damage and accidents)

10. Impact on supply chain(Management)

  • Negative
    • Costs
    • Increase prices of services provided
    • Challenge for small and medium sized firms
    • Complex networks & relationships
  • Positive
    • Increased collaboration
    • Facilitate trade & attract shippers

11. Adding Value to supply chain

  • Information sharing and technology
    • Better shipment visibility
    • Better understanding of customers wants and need
    • Reduced order cycle time
    • Reduced error
  • Collaboration and integrity
    • Share information and risk,
    • Eliminate excess inventories
    • Reduce lead times and uncertainty
  • Improved SQ &customer value

12. Adding Value to supply chain (Cont)

  • Improved performance and enhanced service quality
    • Through encouraging time sensitive &
    • efficient operations
  • Harmonized and secure trade
    • Security along the entire supply chain
    • e.g. T he events of September 11, 2001 resulted in significant financial impact on US supply chains estimated at USD 150 billion a year due to increased inventories, filled warehouses, border closures, increased lead times

13. Conclusion

  • Compliance with CSI and C-TPAT requirements may affect supply chain performance positively and negatively
  • Players in the supply chain should consider effective security management in order to benefit from security initiatives as much as possible and reduce its negative impact
  • CSI and C-TPAT can play a critical role in adding value in the supply chain through facilitating information sharing, technology, integrity and collaboration as well as enhanced efficiency and harmonized trade



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