Morai-Logistics-Blog-cyber-threats

Relying on many moving parts and technology, today’s supply chains are especially vulnerable to cyber threats.

Just a couple of weeks ago, Ukraine was hit with vicious cyberattack severely damaging its computer infrastructure. Dubbed ‘NotPetya’, the computer worm responsible is also believed to have shut down ports, factories and offices across an estimated 60 countries.

The attack is just the latest in a growing number of international cyber attacks and data breaches. Several high-profile retailers and their supply chains are among that number.

Cyber attacks may be relatively new, but their impact on global supply chains keeps growing. A compromised system only negatively affected some individuals in the past. However, recent news reminds us that the scale is much bigger these days. An entire section of global commerce can be shut down or compromised with only a few computers. For that reason, we are dedicating this post to covering the impact cyber threats have on supply chains.

Short History but Big Impact

Although they have a large impact today, cyber threats are a relatively recent phenomenon. The first recognized attack according to NATO Review Magazine, was by the Morris worm in 1988. It spread across several US computers, gradually slowing them down until they were unusable.

Cyber attacks really started making international headlines during the early 2000s. Before then, such attacks were usually the result of one or a few individuals. During this timeframe, they became systematic attacks against large organizations and governments.

Some notable examples are:

  • Plans for new US space launch vehicles being stolen by foreign hackers (2006)
  • Spywares were found in the computers of classified departments and corporate leaders during a China Aerospace Science & Industry Corporation (CASIC) intranet network surveyed (2007)
  • The Canadian Finance Department and Treasury Board were forced to disconnect from the internet after a major cyber attack was conducted against the country’s Department of National Defence (2011)

The Cost of Unsecured Networks

Its been estimated that data breaches and cyber attacks currently cost the international community $2.1 trillion annually. That number is set to increase as technology improves and hackers become more resourceful.

Two recent examples of retailers suffering from costly breaches are:

  • Target (2013)—the data of 110 million customers and at least 40 million payment cards were stolen. The attackers got in by stealing the network credentials from one of its vendors.
  • Home Depot (2014)—like the Target attack the year before, the people responsible stole the credit card information of its customers. The weak point was also a third-party vendor.

In just about every case, businesses incur losses in terms of financial penalties, legal costs, loss of consumer confidence, and a decreased stock price. The worst effect is the hit to the organization’s reputation.

On average, a U.S business that suffers such a data breach can expect to lose around $6.5 million when all it said and done.

With cyber attacks being a threat to organizations big and small, everyone needs re-evaluate the security measures they have in place. Ignoring the problem is too costly and simply too dangerous for everyone. Reuter’s contributor Tom Miles explains:

The degree of interconnectivity of networks implies that anything and everything can be exposed, and everything from national critical infrastructure to our basic human rights can be compromised

If you liked this blog post, why not subscribe to our blog? If you’re interested in what we do as a 3rd party logistics provider, don’t hesitate to check out our services (as expressed above, we are very pro finding you the lowest total cost!). We’re also in the twittersphere, so give us a follow to get the latest logistics and supply chain news.

Morai-Logistics-Blog-Nintendo-Switch-Part-2

While modern companies focus on providing exceptional service, Nintendo continues to focus on extraordinary products with a Customer-Centric approach.

In our last post, we began exploring the reasons behind Nintendo’s history of not meeting consumer demand. Many of its gaming consoles, software, peripherals and promotional items in the last 20 years have seen instances of scarcity across its North American and European markets. Limited supply, inflated grey market prices, and angry consumers have been the result.

Nintendo’s latest console, the Switch, launched a few months ago with similar supply shortages. Some customers and press accused the company of intentionally limiting production to drive sales given the familiarity of the situation.

What’s behind the latest supply issues is the company’s customer-centric philosophy, not artificial scarcity.

Artificial Scarcity Isn’t the Problem

On the surface, Nintendo’s selling practices may seem to favour artificial scarcity to drive sales. The problem with this theory, is that artificial scarcity is only ever a short-term solution for luxury products. Artificial scarcity only generates demand because of perceived scarcity. The actual value of the product isn’t considered, meaning that the company doing it has little incentive to innovate the product. After a certain point, and despite a company’s attempts, there will be too much of a product in circulation for it to maintain its price.

Nintendo is a nearly 140-year-old multi-national company, iconic and influential in its industry. If it followed the same strategy as the former Beanie Baby empire, it would’ve folded decades ago.

The ‘problem’ with Nintendo’s management and supply chain strategies, is that they’re very customer-centric.

Customer-Centric: An Old but Effective Model for Nintendo

Newcomers like Amazon, Uber and PayPal have been disruptive to many industries. However, their biggest contribution is the latest trend of customer-focused strategies. Many companies are now trying to streamline their services to better improve the customer experience.

Ken Ramoutar of Avanade Insights, highlights what a customer-centric focus involves:

  • Anticipate your future needs looking at behavioural patterns, market trends, leveraging data from inside and outside the organization
  • A unique and memorable experience; seamless across your interaction channels
  • Analytics to inspect call logs and problem reports to feed changes in supply and production

None of these describe Nintendo’s business practices or product design philosophy. In fact, the company is notorious for being especially conservative in an industry that’s in constant flux.

Nintendo and Unique Gaming Experiences

Nintendo’s focus throughout its long history, is on creating products that provide a unique experience in and of themselves. Unlike its past (Sega) and current competitors (Sony and Microsoft), the company never bothered to chase the latest technological, marketing or business trends. This historically had both good and bad results for the company at different points in its history. However, it has allowed it to remain strong in the face of ever ballooning industry costs. Sony and Microsoft may have millions of dollars to throw behind their development and marketing strategies, but Nintendo has its Blue Ocean Strategy.

That’s it for this week’s post. In the final entry of this three-part series, we’ll describe how Nintendo’s Blue Ocean Strategy and customer-centric approach has led it to continue to be a dominating force within its industry.

If you liked this blog post, why not subscribe to our blog? If you’re interested in what we do as a 3rd party logistics provider, don’t hesitate to check out our services (as expressed above, we are very pro finding you the lowest total cost!). We’re also in the twittersphere, so give us a follow to get the latest logistics and supply chain news.

Cargo theft isn’t anything new. From the days of bandits attacking caravans to pirates on the sea, if there is money to be made from stealing cargo and fencing it then attempts will be made to steal it. The real change is in the sophistication and planning that thieves utilize in their planning.

Globalization has also made the scope of the problem much larger. The ripples felt in one part of the world from stolen cargo can affect consumers and businesses on another side of the world. That’s to say nothing of the highly organized, highly structured, gangs, cartels, and black markets which fence the items taken from stolen cargo whose networks can stretch time zones.

This month, we’d like to focus our ebook on looking at the current state of cargo thefts and ways we can minimize these occurrences.

Looking at the Impact of Cargo Theft and Possible Solutions

Morai-Logistics-eBook-Cargo-Theft

That’s it for us this week! If you liked this blog post, why not subscribe to our blog? If you’re interested in what we do as a 3rd party logistics provider, don’t hesitate to check out our services (as expressed above, we are very pro finding you the lowest total cost!). We’re also in the twittersphere, so give us a follow to get the latest logistics and supply chain news.