OWC Protestors Driving Supply Risk, Disrupting Port Traffic

As if natural disasters, a questionable GDP growth climate, the future of European/EU sovereignty and bank defaults were not large enough contributors to the supply risk pie -- both individually and collectively -- we've now supersized the issue by adding domestic protesters to the equation. According to the AP and USA Today, the Port of Oakland was shut down last week for a period of time after "demonstrations that turned violent, injuring people and ending in arrests for many." Following this unruly behavior, "Police in riot gear tried to control crowds that broke into a vacant building, shattered downtown windows, sprayed graffiti and set blazes along the way." Even though there are some important supply risk implications to domestic (and international protests), we got a bit of a chuckle about this in the office after reading a piece the previous day that the most dangerous thing about the protesters were the venereal diseases that were being passed around amongst the participants in various cities.

Supply chain disruptions should never elicit a laugh, however. There's nothing peaceful when protestors light fires in the middle of streets. Nor is there when other protesters, "many of them men wearing black, some covering their faces with bandanas and some carrying wooden sticks, smashed windows of a Wells Fargo bank branch while chanting 'Banks got bailed out...We got sold out,'" take similar violent actions. Without question, procurement organizations should begin to factor in localized protests into their risk planning efforts, especially when such protests begin to impact logistical infrastructure.

In addition, labor unrest and protests, especially when it can be isolated to certain cities with greater activity than others, should be a warning sign about potential future disruptions in the area. Perhaps the best defense in this situation is a good supply risk audience. And here we would argue that companies should take a geospatial approach to mapping their supply chain activities and supplier facilities against the location of protests, unrest and the like. Any trends that begin to appear in high activity areas -- or potential bottlenecks -- should be a warning flag that contingency planning efforts should move into high gear. We recommend companies take advantage of a combination of supply risk management software with feeds from sources like the AP, Thompson Reuters, Lexis-Nexis and other sources. More advanced organizations may factor in additional unstructured data sources from Twitter, Linked-In, Facebook and the like in their real-time analyses and planning efforts.

Jason Busch

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