Instability in the supply chain is nothing new; we’ve been battling the aftereffects of the pandemic, multiple wars, natural disasters and tariffs for years now. This week, our attention turns to how deep-seated security threats continue to penetrate global networks — quietly driving food insecurity, population displacement and steep price hikes far upstream.
The World Economic Forum reports the following alarming realities:
- Localized insurgencies, armed banditry and farmer-pastoralist conflicts are severely disrupting Africa’s agricultural supply chains and leaving 33 million people facing severe food insecurity.
- In Latin America, illicit networks and drug traffickers have deeply penetrated legitimate trade, contaminating global supply chains by laundering illegally mined gold and infiltrating major agricultural exports.
- Armed groups and local insurgents in Southeast Asia have embedded themselves within the clean energy supply chain, extorting mining operations and taxing critical raw materials.
All of these defense breaches highlight a single major issue: the worsening security situation in emerging economies — which are often starting, processing or transit points for global supply chains. Of course, as upstream security becomes more of a blind spot for supply chain leaders, the effects are widespread, from skyrocketing prices to an uptick in drug trafficking.
As one disturbing example, when Ecuador became a major cocaine transit route, “traffickers infiltrated its banana, shrimp and cacao industries, resulting in 63 workers killed by criminal groups in 2022 alone” and a 400% increase in shipping container contamination.
It’s up to supply chain leaders to build infrastructure that prevents bad actors from disrupting and tainting the entire value chain. WEF suggests the following steps for increasing resilience: First, we must look beyond conventional governance by embracing a multifaceted approach centered on visibility, coalitions, legitimacy and foresight. This process must not be limited to direct suppliers; instead, organizations should “formalize partnerships with field intermediaries, such as regional researchers, humanitarian agencies and investigative journalists” to understand the potential for security breaches.
Visibility yields myriad benefits, including timelier, data-driven decisions; identification of potential bottlenecks; optimized inventory levels; and more effective allocation of resources. Furthermore, because sharing intelligence lowers risk, building effective coalitions ensures that “buyers, intermediaries, producers and local actors develop shared accountability” along volatile trade corridors.
Build resilience by reducing risk
“Resilience is not just about risk management — it’s about gaining a competitive advantage through agility, balance and culture,” writes ASCM Editor-in-Chief Elizabeth Rennie for our Insights Blog. “But building resilience is an ongoing process: As technology evolves, so will the threats and opportunities facing supply chains. Companies that embrace continuous improvement and invest in the right tools and strategies will be best positioned to navigate the complexities of the future.”
As you work toward eliminating the blind spots from your networks, ASCM’s Supply Chain Resilience Certificate is an essential tool. You’ll learn to integrate resilience into all aspects of your operation by strengthening supplier collaboration and using data and strategic planning to ensure you are well-prepared for the next disruption. Get started today.
