Supply Chain Resilience: Transportation Considerations
This article provides transportation supply chain resiliency considerations as an expansion to Supply Chain Resilience: An Urgent Priority which highlights overall supply chain disruption challenges and includes mitigation and resilience strategies.
The ability to transport goods and resources effectively represents a critical link within the global the supply chain. Nearly all goods and resources, whether farm-to-table or shipped worldwide, rely on an often complex transportation network to reach the consumer. The supply chain comprises a network of people, processes, and technology necessary to produce and distribute commodities globally. The last several years have shown an ever-growing demand on supply chains from consumers and retailers accompanied by unpredictable transportation challenges. As a result, the global supply chain continues to suffer, inflicting cascading obstacles throughout the rest of society.
Though many factors contribute to these supply chain trends that are seen globally, the magnitude of reliance on the transportation sector across all industries has the ability to combat these issues systematically. Stakeholders can best posture their communities for success by proactively identifying transportation threats and properly communicating how best to utilize their transportation capabilities to create resilient and capable supply chains.
Threats and Potential Impacts
Stakeholders and the public are increasingly recognizing supply chain delays and shortages as an area of concern. These shortcomings result in consumer inconvenience, inflation, and are increasingly responsible for public health and safety concerns, as we have recently seen with pediatric medication and formula shortages.
The pandemic has irrevocably impacted the supply chain and changed consumer habits. This can be seen with the exponential growth of the e-commerce industry, which requires last-mile delivery and substantial transportation infrastructure to provide goods directly to consumers. Additionally, it has created an increasing focus on the domestic production of critical resources and diversification of how goods are routed into ports around the nation. Moreover, as the impacts of COVID-19 continue to loom in the background, transportation challenges continue to emerge, such as the recently avoided rail strike, further adding strain and pressure to the supply chain.
Societal impacts have been exacerbated by ongoing labor shortages across the transit workforce, fluctuating oil prices, and infrastructure limitations that further restrict the effective and efficient transportation of goods across the nation. Additionally, malicious actors, including cyber attacks, pose a significant threat to increasingly automated and technology reliant supply chains. Not only is customer data privacy at risk, but attacks can also cause physical damage to cargo or transportation equipment and disrupt significant routes for prolonged periods.
Collectively, these emerging supply chain challenges are among many to offer context that stakeholders may consider when addressing future impacts on already strained systems.
Transportation Supply Chain Indicators
It is important for emergency managers to recognize the critical linkage that transportation has within the current supply chain issues. With this awareness, it is possible to identify the Key Performance Indicators (KPIs) that can then be used to anticipate transportation-related supply chain issues in order to mitigate their frequency and severity. As emergency managers, jurisdictions, and agencies understand the patterns of the KPIs, they can subsequently leverage this to prepare and develop resiliency throughout future shipments, deliveries, and distributions.
Transportation Labor Capacity
Monitoring employment trends across the transportation modalities (i.e., rail, maritime, road, and air) helps jurisdictions and agencies determine how the delayed supply chain will affect them and consider alternative transit modes. Fewer transit workers lead to delayed delivery times, which is a direct cause of inflation and insufficiency as supply cannot meet the demand.
The rate at which imported containers move inland from ports also helps jurisdictions and agencies project how much staffing they need, how to prepare their modes of transportation, and what to communicate to their consumers. Identifying current capacity is critical for preparing for future capabilities and needs.
Understanding all possible transportation routes and modes for goods and resources can aid jurisdictions and agencies in identifying optimization routes. These routes avoid highly populated areas and damaged infrastructure, encouraging timely and safe deliveries.
Jurisdictions must recognize that Logistic Supply Chains and Distribution Plans differ from location to location based on their demographic’s wants, needs, and goals. Supply chains may also vary due to available resources and particular nuances within a jurisdiction. Because of this, jurisdictions must understand that identifying the most appropriate KPIs for their unique circumstance is the most effective way to account for their needs and address the challenges they are seeing.
Preparedness and Mitigation Strategies
Available at local, state, and federal levels are response and recovery resources for transit industries to use while combating transportation-related supply chain challenges. Some available funding resources are Infrastructure Investment and Jobs Act (IIJA) and Promoting Resilient Operations for Transformative, Efficient, and Cost-Saving Transportation (PROTECT). These resources and others offer billions of dollars to communities all over the United States (US) to improve the resilience of transportation infrastructures.
While jurisdictions can access many response and recovery resources to support the transit industry’s role in the supply chain, many emergency managers would suggest that the best way to improve resilience strategies in the transit sector is by enhancing preparedness and mitigation postures through:
Hazard Vulnerability Assessments, Critical Transportation Infrastructure Vulnerability Assessments, and traditional Risk Assessments are helpful tools to measure how supply chain disruption can affect organizations. These strengthen an organization’s resilience by measuring risks and potential impacts, assessing the economic costs of failing infrastructure, and identifying profitable investments. In addition, once assessments are complete, the organization can use the results to develop improvement road maps.
Continuity of Operation Planning
Proactive response and recovery planning can be conducted by developing and implementing Continuity of Operation Plans (COOPs). COOPs organize policies and procedures that encourage the delivery of an organization’s essential functions during a disrupting event such as supply chain delays. A COOP can help a community withstand delayed shipments of highly critical goods and identify alternate transport strategies when developed and implemented appropriately.
Seminars, Trainings, and Exercises
Seminars, trainings, and exercises are great ways to learn and test the transportation capabilities of organizations and the community. Through these activities, organizations can identify existing and emerging gaps in their supply chain management policies and procedures and address them proactively. Seminars, trainings, and exercises also encourage engagement with regional partners to learn how to help one another during a supply chain disruption. Relationships formed during events such as a transportation-related supply chain exercise allow jurisdictions to evaluate existing plans of action during blue sky days while strengthening interpersonal relationships that can be leveraged during gray sky events.
Hagerty Can Help
Hagerty has experience offering its transportation clients and their stakeholders a range of preparedness tools and services that help improve their overall mitigation and resiliency needs. From developing regional preparedness frameworks to conducting assessments, trainings, and exercises, Hagerty can help.
Chris Faircloth is a Senior Managing Associate and the Preparedness Division’s Transportation Sector lead at Hagerty. With Hagerty, he primarily works with rail and maritime partners to build preparedness and response initiatives. Prior to joining Hagerty, he worked in emergency medicine overseeing local EMS operations and international health programs for austere environments, including the maritime and aviation industries.
Avery DeLong is a Hagerty Associate with a diverse range of experience working on projects within Hagerty that consist of transportation, energy, Complex Coordinated Terrorist Attack (CCTA), continuity, and cyber. Prior to joining Hagerty, she worked on building community resilience by identifying public health, healthcare, and other critical infrastructures that would be impacted during different types of disastrous events.