Insight by Thomson Reuters

Understanding, mitigating supply chain risks starts with data

The focus on supply chain risks has been receiving a lot of attention lately. A new policy from the Committee on National Security Systems established an integrated, organizationwide cybersecurity risk management program to achieve and maintain an acceptable level of cybersecurity risk for national security systems.

The Homeland Security Department and GSA issued a new supply chain risk management plan for the continuous diagnostics and mitigation (CDM) program in August.

The U.S. China Security Commission is awaiting an unclassified report about the supply chain challenges agencies face in buying commercial technology.

And NASA set up a value-added reseller program for its SEWP V contract to further ensure confidence in its vendors’ supply chains.

It’s more than just technology and cyber challenges.

The Government Accountability Office listed supply chain management as a high risk area for the Defense Department since 1990.

GAO says DoD manages about 4.9 million secondary inventory items, such as spare parts, worth about $91 billion.

The supply chain management high-risk area focuses on materiel distribution and asset visibility within DOD. GAO says that as of 2017, DoD has addressed its weakness around inventory management. The Pentagon still must improve its asset visibility and its material distribution.

Supply Chain Risk

Information communications and technology supply chain is global and is a significant source of risk to the department and to the homeland writ large. We are beginning to address these issues around who are the companies we are doing business with, who are the people that are running those companies, what are the locations that those companies operate in and what are the deliverables are those companies providing to us?

Mitigating Risk

A lot of our focus is how to mitigate this risk. This spring we will deploy what we are calling a business decision analytics tool, using a lot of web-based, advanced predictive analytics to bring focus on three aspects of the supply chain: items we buy, prices we are purchasing them and the company itself. This will be a tool for all of our acquisition specialists to be able to dive into any of the three attributes to get as much analytical data as possible before we enter into an agreement with someone in the supply chain.

Partnerships with Industry

Data is out there. The tools are out there. This is something every company that works with the government should be prepared to have a solid supply chain process. The government is going to be asking and the government already is doing it themselves.

 

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