The Impact of 9/11 on Global Logistics
The Impact Global Terrorism in Logistics
The existence of global terrorism had several implications on global economy. The 9/11 attack in particular changed the corporate landscape of major economies in the world. Several firms had to re-model their security strategies to protect the business from eminent attacks of terrorism and considered incorporating preventive measures. One of the operational areas being considered by firms to be protected is the logistics function of the company. Apple Inc. for instance faces logistics operation threats as a result of global terrorism. Such threat may affect Apple’s business greatly in terms of damages, supply chain and logistics disruption. From 2009 the company gained 54% of its sales from the overseas market, which is the biggest contributor to the company’s revenue. Therefore, Apple’s logistics operation plays the biggest role in ensuring the company’s strong foothold in the global market; on the other hand logistics is also the most vulnerable to global terrorism.
Apple will face the threat of loses from destroyed cargo’s, delayed deliveries, short-term economic loss and difficulty of bringing the products to the global electronic consumers due to transportation difficulties (Kotabe & Helsen, 2010). For example, Apple contract suppliers overseas to manufacture parts for their products and Apple ship’s the finished products all around the globe following a specific date of market release. This flow supplies and goods are being handled closely by logistics. However, when global terrorism gets in the way of the logistics process, the company will face the challenge of delays and loss of significant revenue. From the company manufacturing warehouse, the goods are being shipped to consignees abroad for distribution. Terrorists normally targets airports and other transportation means to create a massive social and economic disruption. If such attack happens while Apple’s logistics operation is in progress, there is a possibility that the goods will not make it on time or be destroyed because the attacked airports will be shutdown and the company will incur losses in the process.
In order to avoid dealing with loses due to the threats brought by global terrorism; the company should mitigate the threats on a whole new approach from a different perspective. Initially, global terrorism is a matter of national security and the company does not have the constitutional powers to involve themselves to directly mitigate on the problem itself. However, the company can create a security blanket for themselves to protect their logistics operations. It all starts with ideas, ideas that are vital to the logistics operations by means of testing alternative transportation solutions. One of the most effective solutions is the use of real-tracking strongly integrated to the company’s logistics network (Kiwitt & Frankenberg, 2012). Seeing how the shipment moves by tracking every step it takes is crucial in identifying the point of disruption and immediately respond by rerouting the cargo. If no real-time tracking strategy is implemented, there is a possibility that the shipment might be lost or destroyed along the way due to a terrorist attack and the company is not aware about it as it happens.
Modeling supply chain solutions would help to create a framework from end-to-end scenarios in supply chain that would define the broad spectrum of problems (Siegers, 2012). Another approach in mitigating the threats of global logistics is to seek for alternatives such as telematics system, which is much lower in terms of costs as compared to FRID. However, these tracking technologies and modeling strategies would only work if the company is willing to do international cooperation. Joining forces with other firms in the same industry or with 3PL’s and 4PL’s would constitute a cooperative effort that would set a global standard in dealing with threats of terrorism. For example, if Apple’s shipment of new electronic gadgets are targeted to launch by the end of the month and the company heard about a threat from the terrorists; Apple should meet with 3PL’s and 4PL’s to discuss the matter and cooperate to come up with a contingency plan that would alleviate the possibilities of disrupting the operations. In addition, the company should also encourage talks with the government to align with their initiatives.
Kiwitt, P., & Frankenberg, S. (2012). The Logistics of the Future: Revolutionary Changes or the Development of Trusted Solutions? Delivering Tomorrow: Logistics 2050 A Scenario Study.
Kotabe, M., & Helsen, K. (2010). Definition of global logistics. In Global Logistics and Distribution (5th ed.). New Jersey, USA: John Wiley & Sons, Inc.
Siegers, R. (2012). Catering to Our Customers’ Future Needs. Delivering Tomorrow: Logistics 2050 A Scenario Study.