@Risk

Last Friday, cargo destination airports were put on high alert after investigators found two suspicious packages on cargo planes bound for the US. The packages were later found to have explosive devices.

Federal mandates now require the Transportation Security Administration (TSA) to screen 100 percent of packages aboard all passenger flights. But, there are no mandates currently in place for cargo aircraft.

Will this new terror threat change all that? Should you begin anticipating increased security measures, longer transit times and higher costs for air freight?

Steve Lord, GAO’s director of Homeland Security and Justice said he expects recent events to prompt a debate on Capitol Hill about the screening of cargo flights. “This is a potential area of concern, and this may refocus Congress’s attention on this in the next session of Congress,” he said. Back in June, Lord testified before the House Subcommittee on Transportation Security and Infrastructure regarding cargo screening on passenger aircraft.

I found it interesting that the New York Times has reported on its blog that shippers are defending the security measures that are already in place:

Maury Lane, a spokesman for FedEx, the carrier for the package that was found in Dubai, said that though the package had arrived via a contract shipping company from Yemen, it had never made it onto a FedEx plane in Dubai. It was, he said, ‘intercepted prior to being loaded on the aircraft, working with the F.B.I. and local authorities.’

An airline official, who did not want to be identified because the subject involved security procedures, said that major shipping companies have sophisticated screening procedures that — in theory — allow them to check packages and letters for explosives and radioactive material. Cargo companies, the official said, often know more about the packages they carry and their shippers than airlines do about their passengers.

Of course, this latest incident is raising questions about these current “sophisticated screening procedures.” Most notably, I would like to know: Are they sufficient? What caused the lapse? And, on a practical level, what will it cost to keep air cargo secure?

Here’s a remarkable statistic: Among the more than 900 electronic records breaches that Verizon Business experts investigated last year, a whopping 96 percent could have been avoided if security basics had been followed.

That’s right. Nearly all of these breaches could have been avoided; only 4 percent of the breaches analyzed required difficult and expensive protective measures. In addition, most victimized organizations (87 percent) had evidence of a breach in their security logs, but overlooked these red flags due to a lack of staff, tools or processes.

The new 2010 Verizon Data Breach Investigations Report , which for the first time was prepared in collaboration with the US Secret Service, is filled with other fascinating results, too –all of which offer some important perspective about the vulnerability of business data and the most effective approaches for mitigating cybercrime threats.  For instance, the report also reveals that: (more…)

Even though the global financial crisis and ever-expanding supplier networks have intensified the spotlight on risk, companies are still struggling to define “risk management” and overcome barriers to its adoption.

For example, more than half of the risk management, finance and C-level executives participating in a new survey from Marsh Inc. and the Risk & Insurance Management Society Inc. (RIMS) rated enhancing strategic risk management as their primary focus area in 2010. Yet, when asked about the top challenges they face when trying to improve their company’s risk management practices, managers in the survey cited what I would consider fundamental system requirements, such as : (more…)

What skill set is particularly strong for a typical procurement team? Negotiation.

Where do procurement pros generally lack expertise? Risk management.

At least that’s what ADR International found when it compiled data provided by more than 3,000 individuals at 40 companies and public sector organizations worldwide.

The results of detailed self-assessments using ADR International’s Development Needs Analysis (ADR DNA) tool show that essential skills including negotiating, soliciting bids and contracting are the highest-scoring on average, while risk management and supply market analysis rank lowest.

If you’re like me, you’re not particularly surprised by this new data. But, I’m pointing it out because I do feel that this gap in know-how is unfortunate, to say the least. (more…)

New data from TPI suggests that the number of outsourcing contracts awarded globally will rise in 2010 as organizations look for new ways to optimize critical business operations in an improving economy.

The TPI Momentum Market Trends & Insights 4Q09 Annual Report released last week predicts that the growing acceptance of cloud computing, increasing interest in multi-sourcing, and emerging focus on governance and risk management will fuel outsourcing contract volume this year. Not surprisingly, the report also says these same factors will narrow the scope of individual outsourcing projects, driving down their value and duration and intensifying competition among service providers. In addition, I suspect a reliance on smaller deals and an enhanced commitment to social responsibility will emerge as major themes.

The report also found that: (more…)