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Roles of ISPS code and standards in supply chain management
The atrocious events of September 11, 2001 galvanised transportation industries into a reaction that has transformed travel procedures, inconvenienced governments and the public alike and given ship and port operators many additional burdens to bear, not least the compliance requirements of the International Ship and Port Facility Security (ISPS) Code.
- By Frank Kennedey, Special to Gulf News
- Published: 23:35 June 1, 2008
The atrocious events of September 11, 2001 galvanised transportation industries into a reaction that has transformed travel procedures, inconvenienced governments and the public alike and given ship and port operators many additional burdens to bear, not least the compliance requirements of the International Ship and Port Facility Security (ISPS) Code.
This notwithstanding, an ironically beneficial consequence of all this change (some have also described the change as being 'hyped-up') has been an increased awareness of security that has considerable potential for progressive ports and companies to exploit to their commercial advantage by being able to market their compliance with an ISO Standard that has been developed because of 9/11.
However, with all of the other mandatory compliance that is often considered a necessary, but nevertheless, cumbersome chore, are players likely to adopt yet another standard - and one that is not compulsory? The answer to this lies, of course, in the commercial benefits that may or may not be obtained and in the cost-effectiveness of the venture.
July 2008 marks four years since ISPS came into force, with mixed opinions regarding its effectiveness. Moreover, despite the furore of its introduction with many claims that the implementation was rushed by the International Maritime Organisation (IMO), on reflection its assimilation into the everyday procedural quagmire of compliance that routinely faces ships, their operators and the ports, has been relatively painless although expensive.
Security issues
This notwithstanding, the subjective methodology of the approval of Port Facility Security Plans by the very contracting governments that instigated its implementation has left some scepticism about ISPS effectiveness (apropos ports rather than ships) in regions of the world where compliance is not part of the respective cultures. Furthermore, the absence of any formal requirement for ship operating companies to be audited (as for the ISM Code) with their ships, has also left an area of concern.
Of equal relevance has been the emphasis of ISPS as a ship and port system, that has not extended beyond this perimeter, whereas the very nature of the supply chain industry involves numerous entities that may be, to a lesser and greater extent, extremely vulnerable to security issues. However, in defence of ISPS, it is an IMO instrument that has been necessarily limited to ships and ports because that is the exclusive 'territory' of the IMO. Any extension, therefore, is appropriately applicable on the vehicle of an ISO standard.
So while ISPS does have its important role to play, it is by definition limited to specified areas and the need for an all-embracing standard for security in the supply chain as a whole has been identified.
Voluntary effort
Generally speaking, for any port from which ships shall sail on international voyages and for all vessels that must be compliant with Solas; ISPS shall be the minimum mandatory standard to which each must comply - anything extra will be a 'voluntary effort' that will be decided by individual ports and companies that shall decide how much commercial advantage any 'voluntary' Standard will provide.
Enter ISO 28000:2007, aimed at organisations within, or related to the logistics industry. It is considered applicable to all areas of the supply chain from the manufacturer to the receiver of goods and in-between: the port operators, the ocean carriers plus a myriad of others, including logistics management companies, truckers, railroads, air carriers, cargo and customs agents, and so on.
A recent independent report conducted by Stanford University on the benefits of supply chain security found that it provided a 48 per cent reduction in cargo inspections, an improvement in inventory management of 14 per cent, a 50 per cent increase in access to supply chain data with a 30 per cent increase in timelines of shipping information, a 26 per cent reduction in customer attrition with a 20 per cent increase in new customers, a 38 per cent reduction in theft/loss/pilferage with a 37 per cent reduction in tampering, a 29 per cent reduction in transit times with a 28 per cent reduction in the delivery time window and a 30 per cent reduction in problem identification, response and resolution times.
Thus, by promoting security into a management system in its own right, rather than a discipline that many considered a necessary but expensive outlay, the concept has been presented as an ISO Standard that should fill the many sectors never covered by ISPS and with significantly better effectiveness. Moreover, those elements already under the umbrella of ISPS should be greatly improved.
The writer is a marine consultant based in Dubai.
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