High Performance: Ensuring Global Freight Security

Despite their potential effectiveness, emerging global security policies have real potential to further constrain the operations and resulting profitability of many organizations.

To prevent this from happening and ensure their competitive positioning on the path to high performance, organizations need new supply chain management approaches to global freight security. This point of view identifies three innovative strategies to help global entities mitigate and even exploit new freight-movement guidelines.

Commercial enterprises have grown accustomed to complying with regulatory efforts—particularly those focused on the security of personnel. However, increased attention is also now placed on the global movement of freight and its associated informational and financial flows. Recent examples include the Customs-Trade Partnership Against Terrorism (C-TPAT) and the Hazardous Materials Vulnerability Reduction Act of 2005, which seek stiffer penalties for noncompliance.

According to Accenture's ongoing research into the supply chain mastery behaviors of high-performance businesses, high performers rigorously execute against their strategies and capabilities and constantly adapt them to changing market needs, such as those associated with freight security. High-performance businesses consistently outperform their peers in revenue, profit growth and total return to shareholders despite industry disruptions, business cycles and new leadership. In a market riddled with constant change, particularly with regards to the freight security regulatory environment, a company's supply chain can spell the difference between success or failure.

Adopting the three anchor strategies can help organizations build supply chains that are information-rich, technologically robust, tightly integrated and highly flexible. In this way, they can master the type of distinctive capabilities that are critical to achieving high performance in today's dynamic and expanding economy.

• Design an optimal security model—The most successful security models are those that are layered, open, flexible and tightly coupled. Layering, or implementing multiple security solutions, is particularly important since no one layer or solution can be expected to fend off all threats.
  
  
• Implement a continuous "sense and respond" capability—This "sense and respond" capability will become even more vital as the frequency of regulatory events increases geometrically, the required time-to-action gets shorter and signal-to-noise ratios decrease (the difficulty of distinguishing valuable information from increasing amounts of post-9/11 clutter and hyperbole).
  
  
• Conduct closed-loop planning and advocacy—This security strategy is geared to helping organizations learn from experience by doing a better job of monitoring decisions and then evaluating associated impacts and reactions. It also means scrutinizing environmental conditions, recording those observations and using them to build dynamic models that improve the future effectiveness of security plans. Savvy executives know the key to continuously selecting and enacting the right responses lies in understanding the outcomes of their own organization's actions, along with the counteractions of other organizations and regulating entities. This insight demonstrates one of the characteristics of high-performance businesses: High performers excel at consistently making the critical decisions that give them the right strategic direction and a winning market focus and position.

While navigating through an uncertain future clouded with more and complex regulations may seem daunting, organizations can help ensure their success by developing and implementing an optimal security model—one that features an innovative "sense and respond" capability and the capacity for continuous improvement and insightful outreach. Furthermore, leading executives know rapid change and elevated risk can actually mean new opportunities for higher profits and increased competitive advantage.

By adopting innovative approaches to freight security, they can prepare themselves to maximize growth opportunities and accelerate their journey to high performance.

This point of view is authored by Jade Rodysill, a senior manager in the Accenture Supply Chain Management group.