In October 2015, the Chinese government announced tighter security checks on courier services following a warehouse explosion and a series of deadly parcel-bomb blasts, reported the Wall Street Journal. The measures introduced by the authorities included X-ray checks on all mail, inspections of packages before sealing the items, and new registration procedures for users of delivery and logistics services.
The security of postal supply chains has become a major concern in many countries. A four-year European project backed by the European Commission called SAFEPOST aims to make postal systems safer for all users.
“Terrorism is just one type of threat that postal systems are vulnerable to, others include the smuggling of goods such as antiques, wildlife, drugs and fake medicines, and more,” says Luca Urciuoli, Associate Research Professor, Zaragoza Logistics Center (ZLC), Zaragoza, Spain. ZLC, one of the project’s participants, is focusing on the identification of security threats as well as assessing the supply chain effects of associated countermeasures.
Protecting human life is the project’s first priority, but postal operators are also worried about the impact of security issues on their performance. Security problems can disrupt mail deliveries as well as the commercial operations that rely on them, explains Urciuoli. Also, operators that are unable to identify the best security solutions for their organizations can suffer a deterioration in services and loss of market share.
The integrity of postal services is an important consideration for enterprises that compete in the e-commerce space. “Our work is of much interest to e-commerce retailers in two ways: security measures can increase delivery costs and hence service prices, and cause congestion at consolidation centers that result in delayed deliveries,” says Urciuoli. “Problems like these can deter online consumers.”
Goods and postal supply chains both strive to achieve fast, reliable delivery services, but they differ in one important way.
Typically, supply chains consist of companies in the upstream and downstream parts of the chain. These trading partners are able to vet the organizations they do business with, making it more difficult for criminals to infiltrate the supply chain and manipulate products. This is not the case in postal or courier supply chains, however, because they encompass countless numbers of private citizens who can send parcels and easily misuse the supply chain.
But there are security solutions that SAFEPOST is exploring. Image detection is one option. Digital cameras can be programmed to look for indications that the contents of a letter or parcel are suspect. Electronic sniffers (also known as e-noses) can detect the presence of telltale particles on target items such as drugs and explosives.
Another option that SAFEPOST is exploring is the collection and sharing of information. “Each postal office or consolidation center in the chain can collect different pieces of information. An operator in a control room or a customs officer can assemble these pieces and decide whether a suspect parcel needs further inspection.” In this manner, errors in targeting high-risk parcels can be significantly reduced, says Urciuoli.
Another common problem faced by managers is how to choose security technologies that best fit their supply chain networks. Which technologies should be selected and where should they be placed in the network? What security budget gives the optimal trade-off between security and performance? Who should pay for security – supply chain companies or governments?
ZLC is working on a methodology for helping organizations to assess the effectiveness of different types of security measures. The tool is similar to IT security programs that employ hackers to test the mettle of computer systems, but uses simulation techniques rather than human agents.
Urciuoli says that the new approach can dramatically reduce the cost of security tests. In addition, it can clarify how different measures impact the postal supply chain in terms of security and operational performance. Clarifying these outcomes gives operators a better understanding of the costs and trade-offs involved. “And it is clear that companies that are able to optimally comply with security requirements, will ultimately gain competitive advantage,” points out Urciuoli.
Another interesting outcome of the work is that by simply developing a graphical user interface, the simulation tool can be turned into a learning game. By developing several risk scenarios the tool allows users to perform table top exercises and to test different resilience strategies. Managers have the opportunity to learn how to weigh security and operational performance factors, and how to best comply with governmental requirements. The tool could also be used in brainstorming sessions involving professionals from the private and public sectors. It can facilitate agreements on what security measures need to be applied, and most of all, whether these investments need to be subsidized.
A future goal of the SAFEPOST project is to establish global standards for securing mail and parcel systems in both the public and private sectors. International standards do exist, says Urciuoli, but they are not compulsory. Moreover, ongoing discussions on security tend to focus primarily on what information to share and what security measures operators should adopt. “But the risk management discipline teaches us that there is no “one size fits all” solution to managing risk. Therefore, how can operators perform risk management in a standardized, systematic and objective manner? We strongly believe that our tool may bring much value to this discussion,” says Urciuoli.
SAFEPOST is scheduled to complete its work in April 2016. The vulnerability of postal systems to infiltration by criminal elements became a global issue following the 2001 anthrax attacks in the U.S. Anthrax spores mailed to the offices of media outlets and politicians caused the death of five people and infected 17 others. The project will not eliminate such threats, but it will help postal and package delivery services to tighten security and develop more robust risk management strategies.
More information on the SAFEPOST project can be found here.
This article will also appear in the winter 2016 issue of Supply Chain Frontiers. Subscribe for free to this electronic newsletter here.
 China Tightens Security on Delivery Services in Wake of Deadly Blasts, Chun Han Wong, Wall Street Journal, October 22, 2015