Freight Transportation Resilience in Response to Supply Chain Disruptions (2019)

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76 Step 3: Assess current practice Step 1:Organize for success Step 2: Develop a communications strategy/plan Identify “early wins” Step 4: Understand the hazards and threats Enhance emergency response capabilities Prioritize detailed assessments Undertake detailed assessments Step 6: Implement Strategies and Actions Ste;p 7: Monitor system Performance System Operations Capital Improvements Step 5: Develop Strategies/Actions Figure 5: Resilient Supply Chain Assessment Process Step 4: Understand Hazards and Threats and Their Impacts/Consequences – This step is perhaps one of the most critical in that enhancing supply chain resilience depends on the type and nature of the expected disruptions. This assessment could be comprehensive by looking at all the types of threats and impacts that might be faced, or it could focus on the one or two threats expected to be most likely or most impactful. This step will also vary by the level of detail desired, the degree to which other background information is already available from other sources (e.g., future flooding locations from already-conducted adaptation studies), and the amount of resources (both funding and human expertise) available to conduct this assessment. Step 5: Develop Strategies, Actions and Plans – Based on the assessment from Step 4, collaboratively identify strategies, actions and plans that can be put in place to improve supply chain resilience. These actions could focus on issues internal to your organization or on improving the relationships among key participants in the supply chain. The breadth of actions is quite broad, ranging from actual infrastructure changes, changes to standard operating procedures, enhancements to existing institutional relationships, training for staff and so forth. This step also includes identifying "early wins", which is designed to establish credibility in the process by identifying actions/strategies/ projects that can be implemented in the short term (and hopefully without much financial support). This could include physical changes to projects already in the development stage, changes in protocols, changes to emergency response/operational strategies, or training opportunities for staff. Step 6: Implement Strategies and Actions – This step includes identifying which of the strategies and actions from Step 5 should proceed to implementation based on organizational capabilities and resources, and which of these

77 actions will have to be implemented later. Implementation plans would include those actions that can be taken solely by one agency, and those that will require joint efforts, and if so, how the responsibilities will be divided among those involved. Step 7: Monitor Performance and Incorporate into Assessing Current Practice – Provide feedback into the planning process as well as to the responses to disruptions when they occur. Based on actual experience with disruptions, what should be done differently to enhance supply chain resilience in the future? How can operations be improved as well as how infrastructure is provided? Several observations on this process merit special attention:  This process can be used by a single agency or organization, or it could be conducted jointly with many others. For example, in the context of making the supply chain more resilient, there are steps in the process that would greatly benefit from collaboration among the different participants in the supply chain. These include understanding what the hazards/threats and the likely impacts/consequences will be; developing strategies/actions/plans in response; implementing strategies and actions; and monitor the performance of disruption response to disruptions and learning from this experience.  This process, however, does recognize that it will often be difficult to engage many of the supply chain participants throughout the process, in particular firms and companies that provide the transportation, logistical and shipping services. Thus, part of the process of thinking through how to enhance supply chain resilience includes identifying the steps where such engagement is critical and be perceived as meaningful by these participants; and then encouraging such involvement.  Part of Step 5 includes "Identify Early Wins," which is aimed at not only implementing actions that will improve the resilience of the supply chain, but also actions that are intended to establish credibility in the process (in other words, participating in the process results in progress, particularly important for private sector participation).  The process includes resilience strategies aimed at improving both the operations/emergency response capabilities of the involved parties, as well as improvements to physical infrastructure that would protect from, or minimize damage caused by, future disruptions. Step 8, monitoring performance and incorporating the results into assessing current practice, thus examines how agencies and firms responded to disruptions as well as how infrastructure strategies and designs resulted in improved resilience.  As noted throughout the guidance, the efforts to increase the resilience of the supply chain to hazards and threats will depend on the type of threat, and the expected magnitude and scope of the impacts. The process outlined in Figure 5 is not intended to provide guidance on every possible combination of hazards, threats, impacts, consequences and participants. However, it is intended to portray a way of thinking about the steps necessary to protect the supply chain and promote a more resilient performance. The guidance then provides more detailed information on each step of the resilience assessment process. The format for the guidance is a series of questions that form the basis for establishing a capability in each step. The questions can be organized into a scoring system if so desired to provide a sense of how many of the characteristics of good practice are present in your current process (like what is done with capacity maturity models). At the very least, the questions serve as a guide on what types of information and actions would lead to a more resilient supply chain. A final chapter presents this guidance in a more hierarchical manner that allows user of the guidance to determine what types of strategies for enhancing supply chain resilience are appropriate for different circumstances.

78 CHAPTER 7: IMPLEMENTING THE RESULTS OF THIS RESEARCH This report described multiple examples of the impacts that large scale disruptions can have on the nation’s transportation system that are essential to supply chains. These disruptions can be caused by natural or man-made disasters, or by deliberate attacks against transportation and information infrastructure. Due to the interconnectivity of the nation’s transportation system, such disruptions can have a multiplier effect on the transportation system which can impact critical sections of the freight supply chain and ultimately impact regional economies. This material below section describes strategies to implement the results of this research. Given the institutional and process orientation of this research, implementing the results of this research will very much rely on demonstrating its usefulness to the many different participants of the supply chain. Possible ways of doing so include: Conduct Pilot Studies of the Guidance Application: Identify 3 to 4 State DOTs who are willing to work with their freight/logistics/emergency response partners to pilot the application of the guidance. This would entail developing materials to support such efforts, and possible use of third-party facilitators in the dialogue. Collect Data on Supply Chain Disruptions: Very few studies or data collection efforts have been undertaken on disruptions to supply chains when an incident occurs on the transportation system. Most of the data collection and information is anecdotal. This effort would establish a capability, perhaps an “on-call” research team under the auspices of TRB similar to teams funded by the National Science Foundation in the aftermath of earthquakes, to immediately investigate supply chain impacts of major incidents. Such data collection would provide a strong analysis foundation for incorporating such concerns into decision making. Conduct Pre-incident and Planning-oriented Transportation Resilience Exercises: Full scale and tabletop exercises are effective tools for simulating supply chain disruptions or events requiring emergency response and transportation system management. However, almost all these efforts focus on incident response. Tabletop exercises should be developed for the pre-planning of incident response, highlighting the different roles and responsibilities for the planning of the transportation system. Public and private stakeholders collaborate on best practices for responding to supply chain disruptions. Potential outcomes include being able to explain the sequence of events to ensure best practices, techniques, and skills to prepare for a disruptive event, and understanding unique perspectives and approaches to preparedness, mitigation, response, and recovery. Incorporate Supply Chain Concerns into Current Tabletop and Field Exercises: Almost all of the current tabletop exercises used by emergency management agencies (and their partners) focus on incident response, which as it should be. This effort would simply develop and provide to such exercises some consideration that the incident might have on supply chains (and why that might be important to the community). Establish State Transportation Resiliency Advisory Committees: As State DOTs develop mitigation strategies for key freight system disruptions, it is important to engage with stakeholders to develop in resiliency strategies. An effective way to capture their input is through the establishment of an advisory committee so that they can provide input throughout the effort. This could be accomplished by a stand-alone committee or by creating a subcommittee of the State Freight Advisory Committee. Members should be mix of private and public sector representatives. Once established, committee meetings should be scheduled at key milestones to provide an opportunity for input and discussion. Materials should be developed to support such an effort. Develop and Use Resiliency Performance Measures (See Research Statement Below): In today’s planning environment, performance measures are key focal points for what is considered a desirable system performance. There are very few resiliency measures in existence, and even fewer that include components of disruptions to supply chains. This effort would provide information to transportation officials on how such performance metrics can be used and the types of strategies that might be considered (found in the guidance).

79 Present Results in Logistics/Freight Forums: Most of the publications in the management literature on resilient supply chains focuses on internal procedures and organizational structures of the firms involved. It is important to broaden this perspective to include all the participants in a supply chain disturbance…including public agencies. This can be done by presenting material in the management literature and/or at supply chain conferences. Develop Training Courses: As far as could be determined, there are no training courses that look at system resiliency and what transportation agencies can do to better prepare for and respond to disruptions. The material in this research would provide a very good foundation for such a training course, augmented with emergency response material. This emphasis on impacts to supply chains and the reverberating impacts throughout the supply chain would be emphasized in such training.