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

Chapter: Chapter 2: System Performance and Supply Chain Resiliency: Review of the Literature

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Suggested Citation:"Chapter 2: System Performance and Supply Chain Resiliency: Review of the Literature." National Academies of Sciences, Engineering, and Medicine. 2019. Freight Transportation Resilience in Response to Supply Chain Disruptions. Washington, DC: The National Academies Press. doi: 10.17226/25463.
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Suggested Citation:"Chapter 2: System Performance and Supply Chain Resiliency: Review of the Literature." National Academies of Sciences, Engineering, and Medicine. 2019. Freight Transportation Resilience in Response to Supply Chain Disruptions. Washington, DC: The National Academies Press. doi: 10.17226/25463.
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Suggested Citation:"Chapter 2: System Performance and Supply Chain Resiliency: Review of the Literature." National Academies of Sciences, Engineering, and Medicine. 2019. Freight Transportation Resilience in Response to Supply Chain Disruptions. Washington, DC: The National Academies Press. doi: 10.17226/25463.
×
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Suggested Citation:"Chapter 2: System Performance and Supply Chain Resiliency: Review of the Literature." National Academies of Sciences, Engineering, and Medicine. 2019. Freight Transportation Resilience in Response to Supply Chain Disruptions. Washington, DC: The National Academies Press. doi: 10.17226/25463.
×
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Suggested Citation:"Chapter 2: System Performance and Supply Chain Resiliency: Review of the Literature." National Academies of Sciences, Engineering, and Medicine. 2019. Freight Transportation Resilience in Response to Supply Chain Disruptions. Washington, DC: The National Academies Press. doi: 10.17226/25463.
×
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Suggested Citation:"Chapter 2: System Performance and Supply Chain Resiliency: Review of the Literature." National Academies of Sciences, Engineering, and Medicine. 2019. Freight Transportation Resilience in Response to Supply Chain Disruptions. Washington, DC: The National Academies Press. doi: 10.17226/25463.
×
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Suggested Citation:"Chapter 2: System Performance and Supply Chain Resiliency: Review of the Literature." National Academies of Sciences, Engineering, and Medicine. 2019. Freight Transportation Resilience in Response to Supply Chain Disruptions. Washington, DC: The National Academies Press. doi: 10.17226/25463.
×
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Suggested Citation:"Chapter 2: System Performance and Supply Chain Resiliency: Review of the Literature." National Academies of Sciences, Engineering, and Medicine. 2019. Freight Transportation Resilience in Response to Supply Chain Disruptions. Washington, DC: The National Academies Press. doi: 10.17226/25463.
×
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Suggested Citation:"Chapter 2: System Performance and Supply Chain Resiliency: Review of the Literature." National Academies of Sciences, Engineering, and Medicine. 2019. Freight Transportation Resilience in Response to Supply Chain Disruptions. Washington, DC: The National Academies Press. doi: 10.17226/25463.
×
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Suggested Citation:"Chapter 2: System Performance and Supply Chain Resiliency: Review of the Literature." National Academies of Sciences, Engineering, and Medicine. 2019. Freight Transportation Resilience in Response to Supply Chain Disruptions. Washington, DC: The National Academies Press. doi: 10.17226/25463.
×
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Suggested Citation:"Chapter 2: System Performance and Supply Chain Resiliency: Review of the Literature." National Academies of Sciences, Engineering, and Medicine. 2019. Freight Transportation Resilience in Response to Supply Chain Disruptions. Washington, DC: The National Academies Press. doi: 10.17226/25463.
×
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Suggested Citation:"Chapter 2: System Performance and Supply Chain Resiliency: Review of the Literature." National Academies of Sciences, Engineering, and Medicine. 2019. Freight Transportation Resilience in Response to Supply Chain Disruptions. Washington, DC: The National Academies Press. doi: 10.17226/25463.
×
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Suggested Citation:"Chapter 2: System Performance and Supply Chain Resiliency: Review of the Literature." National Academies of Sciences, Engineering, and Medicine. 2019. Freight Transportation Resilience in Response to Supply Chain Disruptions. Washington, DC: The National Academies Press. doi: 10.17226/25463.
×
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Suggested Citation:"Chapter 2: System Performance and Supply Chain Resiliency: Review of the Literature." National Academies of Sciences, Engineering, and Medicine. 2019. Freight Transportation Resilience in Response to Supply Chain Disruptions. Washington, DC: The National Academies Press. doi: 10.17226/25463.
×
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Suggested Citation:"Chapter 2: System Performance and Supply Chain Resiliency: Review of the Literature." National Academies of Sciences, Engineering, and Medicine. 2019. Freight Transportation Resilience in Response to Supply Chain Disruptions. Washington, DC: The National Academies Press. doi: 10.17226/25463.
×
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Suggested Citation:"Chapter 2: System Performance and Supply Chain Resiliency: Review of the Literature." National Academies of Sciences, Engineering, and Medicine. 2019. Freight Transportation Resilience in Response to Supply Chain Disruptions. Washington, DC: The National Academies Press. doi: 10.17226/25463.
×
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Suggested Citation:"Chapter 2: System Performance and Supply Chain Resiliency: Review of the Literature." National Academies of Sciences, Engineering, and Medicine. 2019. Freight Transportation Resilience in Response to Supply Chain Disruptions. Washington, DC: The National Academies Press. doi: 10.17226/25463.
×
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Suggested Citation:"Chapter 2: System Performance and Supply Chain Resiliency: Review of the Literature." National Academies of Sciences, Engineering, and Medicine. 2019. Freight Transportation Resilience in Response to Supply Chain Disruptions. Washington, DC: The National Academies Press. doi: 10.17226/25463.
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21 CHAPTER 2: SYSTEM PERFORMANCE AND SUPPLY CHAIN RESILIENCY: REVIEW OF THE LITERATURE 2.1 INTRODUCTION Various documents, including journal articles, reports, conference papers, articles in periodicals, news articles, presentations, and electronic media, were examined to identify freight resiliency research practices and approaches found in the U.S. and other countries. The primary focus was to collect literature presenting freight disruption case studies, describing mitigation measures that minimize the impact of disruptive events, and/or providing lessons learned to assist in expedited recovery efforts in the future. General literature addressing the types of disruptions, resiliency factors, and broad mitigation strategies focused on the freight supply chain were also reviewed. More than 100 documents were considered out of which some 75 documents became part of more detailed review. Documents that specifically focused on case studies and mitigation strategies for disruptive events were organized into a searchable literature database. The time period of the literature reviewed spanned the years 2000 to 2016. A literature database was created that tabulated various articles, reports, and presentations, and provided a searchable tool that could be filtered based on the type of disruption event, impact severity, and resiliency strategies employed. Besides identifying the types of cargo movement dealt with, the database identified the modes impacted, the nature and geographical scope of the disruptive event, its location and disruption type, as well as its impact, resiliency category, any resiliency strategies adopted or suggested, and a summary of each reference reviewed. One of the purposes of this literature review was to identify how system resiliency was defined or interpreted by various participants in the supply chain. While there is currently no universally accepted definition of resilience in transportation systems, recent literature offers some useful insights (see discussions in Goodchild et al, 2009; Ponomarov and Holcomb, 2009; Mattsson and Jelenius, 2015; Reggiani et al, 2015; and TRB, 2017). Wang (2015), for example, suggests that a resilient transportation system must display the following qualities: be able to recover efficiently from disasters; be reliable in terms of network connectivity and travel time; and be economically, environmentally and socially sustainable. Getting a little closer to actual performance measures, Chang et al (2010), suggested that transportation system performance (in their case in response to earthquake events) can be measured by a disruption’s impacts on travel delay cost, network flow capacity, and source-to-destination reachability or connectivity. While specific formulas vary by study and agency, these measures are similar to the types of performance measure outputs produced by current transportation planning models. The literature reviewed for this research was not limited to disruption events that have occurred in the past, but also included publications that postulated events that might occur in the future, and how the supply chain community should be prepared for these events. Key conclusions and findings from the literature search are summarized below. 2.2 DISRUPTION TYPES AND CHARACTERISTICS A disruptive event is one that causes direct short-term or long-term impacts such as fatalities, infrastructure destruction, community damage, agency or firm operational disruptions and economic loss (Mesa-Arango et al, 2013). In terms of freight transportation, disruptions can be defined as unplanned and unanticipated events (and in some cases planned events such as the planned shutdown of locks for maintenance) that affect the normal flow of goods and operations in supply chains and transport networks (Svensson, 2000). Disruption, in the context of seaports, is often defined as any significant loss of a port’s regular cargo-handling capacity. Port disruptions not only affect those freight businesses directly involved in maritime operations but can also affect the broader regional economies and industrial sectors they support (Southworth, Hayes, McLeod & Strauss-Wieder, 2014).

22 In order to enhance freight transportation system resilience, it is important to understand various types of disruptions and their characteristics. The following sections discuss these characteristics using several well-documented disruption events as examples. 2.2.1 Lead Time An important resiliency-related characteristic of a disruption is the degree to which businesses, public agencies, and individuals know that a disruption is likely to occur. This is also known as “lead time”, defined as “the time between knowing that a disruptive event will take place and the event’s first impact” (Sheffi, 2015). This timeframe, which varies depending on the type of disruption, can help characterize types of disruptive events. Some disruptions, such as those relating to climate change, may involve long-term trends that provide ample lead time (although even here decisions relating to infrastructure that will be in place for a long time should consider likely future environmental conditions in project location and design (Meyer et al, 2014)). Other disruptions could be planned, such as noted above a lock closure, providing relatively accurate advance notification and opportunities to make alternate arrangements. Disruptions can also occur without any advance notification, such as an earthquake, wildfire, or terrorist attack. Based solely on lead time, a disruptive event was characterized in this research as follows: Abrupt events – disruptions that occur with no to extremely little advance notification. These could be natural disasters such as earthquakes, tsunamis, or man-made events such as terrorist attacks, bridge failures, fires, technology failures, or financial failures. If advance notification of such events is possible, such notification is usually measured in minutes or hours. The September 11, 2001 terrorist attacks in New York City and Washington, DC temporarily prevented movement of goods across all borders into the U.S. (Oke & Gopalakrishnan, 2009). Manufacturers began to experience disruptions to the flow of materials especially for just-in-time parts delivery. Ford Motor Company had intermittent idling of assembly lines. Toyota was about to halt production at its Sequoia SUV plant in Indiana due to lack of steering sensors (Sheffi, 2002). Similar consequences were observed after the March 2011 earthquake in Sendai, Japan, which measured M9.0 on the Richter scale (OSSPAC, 2013), and in turn generated a debilitating tsunami. The damage caused by the earthquake and the tsunami shut down manufacturing plants in Japan that made automobile parts (Baymout, 2014). A Hitachi automotive plant which was shut down by this disaster produced a $2 monitor for a $90 airflow sensor used in many vehicles. Due to the disruption in the delivery of this one part, the General Motors engine plant in New York and its vehicle assembly plants in Europe and the U.S. were shut down (Rice, 2011). A bridge deck fire in Atlanta, Georgia in 2017 caused one of the busiest interstate highways in the nation to be closed for just over two months. Although the impact on long-distance trucking was minimal (the state only allowed truck travel on this interstate by permit and thus many trucks used alternate routes anyway), the closure of the interstate significantly disrupted local goods movement and shipments to nearby businesses. Rapid events – disruptions that occur with little to moderate advance notification. These could be natural events such as a hurricanes, snow or ice storms, floods, or man-made events such as a labor strike. These events show some warning signs and notification could occur days in advance of the actual event onset. Some examples include:  Superstorm Sandy struck the City of Santiago de Cuba on October 26, 2012. Hurricane forecasting showed that the storm would hit the eastern U.S. seaboard sometime thereafter. Within three days, Sandy made landfall near Atlantic City, New Jersey, causing a very disruptive storm surge along the New York and New Jersey coasts (Southworth, Hayes, McLeod & Strauss-Wieder, 2014). Disruptions to the nation’s logistics network were significant and lasted, in some cases, for weeks.

23  In 2002, negotiations between the International Longshoremen and Warehouse Union (ILWU) and the Pacific Maritime Association (PMA) stalled resulting in a work slowdown on all U.S. west coast ports and a strike by ILWU workers (GTRC, 2012) (Farris III, 2008). Many cargo and container ships were stranded in west coast harbors or tried to find alternative ports.  In 2007, a combination of heavy snow in the Cascade Mountains followed by heavy rains in the southwest portions of Washington State resulted in major flooding. The rainfall intensities were 140 percent higher than the 100-year storm amount (GTRC, 2012). This led to closure of a section of I-5 due to landslides, flood debris, and downed powerlines blocking the road. Truck detours added substantial travel times to normal truck routes in this corridor (WSDOT, 2008).  Hurricane Maria in 2017 made a devastating landfall in Puerto Rico causing major damage to both public and private transportation/logistics facilities. Besides the impact to freight infrastructure, the hurricane highlighted the broader issues of recovering from major disruptions, such as the lack of labor for handling containers because employees were focusing on their own families’ concerns. Planned/Predictable events – disruptions that occur with an ample amount of advance notification. These could be natural events such as climate change, or man-made events such as a scheduled river lock or bridge closures. Most of these events are planned and hence they provide enough warning before occurring. Advance notification of such events could be measured in weeks, months, or years.  An example of such a planned event is the Columbia-Snake River lock closure. In order to replace aging lock gates and repair other navigation components, the U.S. Army Corps of Engineers (USACE) closed the Columbia-Snake River to barge traffic. Five of the locks from The Dalles in Oregon to Lewistown in Idaho were closed for repairs. This led to closure of the entire waterway for a 14-week period. Stakeholders were notified 18 months in advance to help them prepare for the planned disruption (Southworth, Hayes, McLeod & Strauss-Wieder, 2014).  Another example includes reconstruction projects of major freeways that require the shutting of many lanes, often resulting in massive backups. Such first major reconstruction started to occur in the 1980s as the useful life of many interstate highways built in the late 1950s and 1960s were being reached. The planning for these types of projects often entailed years of preparation, and not only examining strategies for maintaining traffic flow on the interstate itself, but also keeping traffic in the broader corridor from being disrupted while encouraging the use of alternate routes and modes of travel (Meyer, 1985).  Climate change is also a type of predictable disruption even with the uncertainties associated with when exact impacts will occur and how they will impact various aspects of society. As noted in the 2018 National Climate Assessment: "Our Nation’s aging and deteriorating infrastructure is further stressed by increases in heavy precipitation events, coastal flooding, heat, wildfires, and other extreme events, as well as changes to average precipitation and temperature. Without adaptation, climate change will continue to degrade infrastructure performance over the rest of the century, with the potential for cascading impacts that threaten our economy, national security, essential services, and health and well-being" (U.S. Global Change Research Program, 2018). Sea levels have risen over the past century as have average surface temperatures. In almost every scientific study, expectations are for stronger hurricanes, increases in the number of hot days and heat waves, and an increase in intense precipitation…. all events that directly affect the logistics and infrastructure components of the transportation sector (TRB, 2008; Meyer and Cumming, 2016; Becker & Caldwell, 2015). Several states and metropolitan areas are conducting vulnerability assessments of their transportation system to identify the types of climate change stresses that their communities and infrastructure systems will likely face in the future.

24 2.2.2 Geographic Scope Another important characteristic of a disruptive event is how far the impacts “reach” up and down the supply chain. The geographic scope can be classified as follows: Local – disruptions that affect a local area and can be mitigated by providing detours or other alternate routes.  For example, in 2013, the northern span of I-5 bridge over the Skagit River in northwestern Washington State collapsed as an oversized loaded truck struck the cross truss and sway braces. This led to the closure of the bridge and the establishment of two detours. The primary detour route added 0.5 miles and the secondary detour added 3 miles of additional travel, respectively. The bridge was reopened within 115 days of its collapse after a permanent span was in place (Horton, 2015). In other instances, such as rural areas not having network redundancy, the length of detour could be much longer and thus result in more economic costs to system users. Regional – disruptions that impact the freight transportation and supply networks of an entire region and require areawide mitigation strategies.  For example, in July 2001, a CSX freight train carrying a mix of freight and hazardous material derailed in the Howard Street Tunnel in downtown Baltimore (NTSB, 2004). The fire led to closure of the tunnel to rail traffic for a week. All CSX trains were rerouted through Norfolk Southern Corp’s tracks. Significant delays, cancellations, and diversions of CSX’s freight trains were observed. CSX’s entire east coast system, as well as the system in the Midwest and as far as Ohio, were affected (SAIC, 2002).  Another example is the above referenced Columbia-Snake River lock closure. This river system supports goods movement from Washington, Oregon, and Idaho, consisting mainly of agricultural products, paper, forest products, and mineral bulk products. The lock closure affected all three states for a period of 14 weeks, requiring mode shifts and other (e.g., higher price) responses to freight movement (Southworth, Hayes, McLeod & Strauss-Wieder, 2014). National – disruptions that impact the freight transportation and supply networks in large parts of the nation, requiring extensive mitigation strategies, and involving multiple agencies at all levels of government. Such disruptions may lead to declaring a federal state of emergency.  Superstorm Sandy is an example of a disruption that had a national impact. In its aftermath, the Port of New York and New Jersey was closed for a week. This led to supply chain disruptions, especially given the timing of the storm….merchandise was arriving from Asia for the holiday season. Vessels were diverted to the Port of Halifax, Canada and Port of Virginia, Norfolk. Containers were subsequently trucked to their final destinations, inflating overall transportation costs (Stevens Institute, 2013).  The West Coast labor dispute reference above also resulted in national-level disruption. The PMA’s lock out of labor affected all the ports on the west coast and lasted for 10 days. More than 200 ships were anchored outside the ports of Los Angeles and Long Beach; it was estimated that it took six to seven weeks to clear the backlog (GTRC, 2012). When the disruption occurred, the six largest west coast ports handled about 253 million tons of cargo annually, with more than half of all containers passing through these ports annually (Farris III, 2008). International – disruptions large enough to affect international freight transportation and supply networks and that require extensive mitigation strategies involving multiple countries.  As noted earlier, the 2011 earthquake and tsunami in Sendai, Japan disrupted supply networks in many parts of the world. The vulnerability of the distributed global network of suppliers for automobile parts to such large-scale disruptions was well illustrated by this disaster in that the closure of plants in Japan had a domino effect throughout the global automobile manufacturing supply chain.

25  Massive floods in Thailand in 2011, most flooding in 50 years, had a similar effect on Asian supply chains as the 201l earthquake and tsunami in Japan. About 50 percent of the automobiles manufactured in Thailand (approximately 900,000 vehicles) were exported to other Asian countries. The floods affected the automobile manufacturing plants of Toyota, Honda, Mitsubishi, Isuzu, Nissan GM, Ford and Mazda. It was estimated that the flooding caused a monthly reduction in assembled vehicles of between 80,000 and 100,000 vehicles (Vaidya and Rao, 2011). A study of the response of auto manufacturers suggested that they would likely adopt one or more of the following strategies:  Increase the stock-pile in terms of auto parts and re-visit the process of just-in-time production so that they have enough parts stock for at least a month.  Adopt a multi-sourcing strategy that involves not only sourcing parts from different suppliers but from different regions to reduce the vulnerability of critical assembly processes.  Modify the investment strategy to focus on “de-risking” the supply chain by emphasizing activities in geographic locations that are least impacted by natural disasters (Vaidya and Rao, 2011).  The September 11, 2001 terrorist attacks in the U.S. also generated an international level disruption. This event not only affected airline travel (and thus air cargo) due to three-day closure of the North American airspace, but they also affected freight moving through the ports of New York and New Jersey, which were both closed for three days. In the aftermath of the attacks the aviation industry lost significant air traffic and revenue. The event also seems to have led to the failure of some financially weak carriers. Swissair and Sabena went bankrupt within months of the attack (IATA, 2011). While the ports and their freight movement were not affected in the long term, for several days, vessels had no place to go, as all international port of entries were closed (GTRC, 2012). 2.2.3 Disruption Impact – Level of Loss The level of loss in terms of loss of lives and economic costs is difficult to quantify, especially for less severe and short-lived disruptions. Moreover, even when a disruption is covered in the literature and popular press, there are often inconsistencies in the reporting of the same event. For example, USA Today reported that Hurricane Sandy caused $65 billion in damage in the U.S. and was responsible for 159 deaths (USA Today, 2013), while a report produced by a major re-insurance group estimated damages worth $72 billion (Aon, 2013). Depending on its geographic scope, level of predictability, duration, and loss of lives and economic activity, the level of impact of a disruptive event can be generalized as follows: Severe impact – disruptive events that can affect national or international freight transportation and rank very high in terms of economic loss, and/or in which many lives are lost. Such events include the 2011 Japan Earthquake, the 2002 West Coast port shutdown, and the September 11, 2001 terrorist attacks. High impact – disruptive events that can affect national or regional freight transportation and rank high in economic loss, and/or lives lost. Events such as Superstorm Sandy or Hurricane Katrina can be considered as high impact events. Low impact – disruptive events that can affect regional or local freight transportation and rank low to moderate on economic loss incurred, and/or number of people injured. Events such as the Columbia-Snake River closure or the I-5 Skagit River bridge failure fall in this category.

26 2.3 MILITARY SURGES A commercial port’s throughput capacity can be affected by disruptions from both natural and labor sources and as well from sudden increases in port traffic that overwhelms port resources. Such a surge in demand occurs for selected ports with a rapid military deployment. Military overseas deployments begin with the movement of troops, material, and equipment from military installations within the Continental U.S. (CONUS) to designated U.S. seaports as their most common domestic destination. With more than 95 percent of U.S. warfighters' equipment and supplies passing through U.S. seaports, a great deal of stress is placed on both the cargo-handling and transporting capabilities of these ports, as well as on the highways, railways, and waterways feeding into them (BTS, 2018). With a heavy reliance during such “sealift surges” on the nation’s commercially-operated ports and modal carriers, a great deal of cooperation and coordination is required among the numerous military and civilian government agencies and private sector companies involved. Adding to the unique nature of such cargo surges, deployments usually involve the transport of large pieces of military equipment such as helicopters and tanks that are not otherwise commonly dealt with, using in some instances military vessels designed specifically for that purpose. In 2005, the U.S. Maritime Administration (MARAD) produced a report assessing the conditions at U.S. commercial ports during the multi-modal movement of military cargo for Operation Iraqi Freedom (OIF) (as reported in BTS, 2018). The assessment included the performance of three major components of the intermodal system---waterside, port/terminal intermodal interface, and landside movements---with an emphasis on the ability of the nation’s commercial freight transportation infrastructure to handle an unexpected surge in cargo during a military deployment. The problems that a military surge in cargo deployments can pose for commercial ports was well summed up as follows: “…, U.S.-based forts may load and dispatch six trains per day to ports, while the receiving port may only have the capability of handling and unloading one to two trains per day. Military deployments, which must preserve unit integrity, may require that a port receive materials and supplies from more than a dozen different U.S. military installations in a short timeframe. Trains and trucks may be dispatched from bases and arrive at the terminal gates with little advance warning” (as reported in BTS, 2018). The report also noted that: “DOD logistics planners have adopted successful commercial methods of handling freight and will redirect cargo at the last moment to accomplish a just-in-time (JIT) delivery. Usually these changes occur with little or no warning to the receiving port” (as reported in BTS, 2018). The MARAD report also noted that the significant projected growth in international trade through U.S. ports, and hence in increased volumes of freight movement, represented a considerable challenge for the nation’s marine transportation system. Nowhere is the challenge seen as more acute than at the nation’s strategic seaports where cargo-handling capacity shortfalls in coming years, notably in the movement of containerized freight, had been projected. Port site visits by MARAD staff indicated that a surge in seaport traffic resulting from a military deployment could lead to significant commercial as well as military shipment delays for a number of reasons, re-ordered here into physical asset issues associated with, 1) landside access, 2) within-port cargo handling operations, and c) issues associated with inter-agency coordination and communications. Landside Port Access  Truck access - trucks entering a port may undergo time-consuming, at-gate credentialing /security checks.  Rail access - including restricted rail use due to low overpass bridges, limited or non-existent on-dock rail handling facilities, and the possibility of congestion at rail-highway traffic crossings.

27  Highway capacity - inadequate highway access capacity leading to multi-truck queues into the port. Adequate signage was also an issue at some ports. Within-Port Cargo Handling  Training - an insufficient number of skilled laborers, especially skilled drivers and handlers of large pieces of military equipment.  Staging Areas - inadequate space in cargo staging areas within the port. Coordination and Communications  Coordination - a lack of understanding of the composition of the military cargo to be deployed through the ports/an incomplete in-transit cargo tracking capability.  Communications – including up-to-date information sharing between trucking firms, railroads, port operators, the U.S. Transportation Command (USTRANSCOM) and its deploying units, and the non- Department of Defense (DOD) federal agencies involved in port regulation and monitoring vis-à-vis the composition, scheduling, port access requirements, cargo staging area locations and special handling needs associated with military unit moves. A similar list of supply chain-based deficiencies is provided by Stribling (2009); also of note, each of these issues is a recurring theme in the literature. 2.4 DISRUPTION CLASSIFICATION Based on the literature review, the disruption classification chart shown in Figure 2: Disruption Classification Framework was developed as part the research. As shown, the chart has “advance notification” on the vertical axis and “disruption impact” on the horizontal axis. Note that this concept is similar to a risk management figure where color coding is used to indicate risk severity. For example, disruption events that fall in the “planned or predictable” notification and “low impact” cell are shown in the lighter color. Compare this to an event in the “abrupt” and “severe impact” cell, which is indicated in a much darker color. For purposes of the research case studies, this chart was used to identify the types of disruptions that would be considered as part of the scenario analysis. The intent was to provide across all scenario case studies a range of disruption characteristics. Events that fall under planned/predictable notification with low to high impact are classified as Class 1 disruptions; those that fall under abrupt, rapid and planned/predictable notification with low, high and severe impact respectively are classified as Class 2 disruptions; and those that fall under abrupt notification with high to severe impact and events that fall under rapid notification with severe impact are classified as Class 3 disruptions. The concept in Figure 2 is presented as a descriptive framework for the types of events that characterize system disruptions. However, the framework also provides an important perspective on the level of risk an agency or firm is willing to adopt with respect to supply chain disruptions if the likelihood of an event occurring is superimposed over the two dimensions shown. For example, without considering the likelihood of an event, one would focus on the "severe" impact events in Figure 2 although likely done so with a consideration of the costs of preparing for and responding to such events. This calculation is altered when the likelihood of the event occurring is included. For example, assume that the likelihood of a terrorist attack against a facility that would be severely damaged is quite low. Compare this event to one that might occur more often but when it does the disruption is small (e.g., a snow storm). Decision makers would have to decide how to allocate funds to prepare and respond to these types of events, with specific attention given to the perceived risk of disruption if the more disruptive event does occur.

28 Ab ru pt Product Quality (Material  Defect) Technology Failure  (Operating System) Infrastructure Failure Accident (Fire/Explosion) Financial Failure (Bankruptcy) Weather Events Technology Failure  (Cyberattack) Terrorism Weather Events  (Earthquake, Tsunami) Military Deployments Ra pi d Weather Events (Snow Storm,  Flooding) Military Deployments Labor Strike Weather Events  (Hurricane, Blizzard) Pl an ne d/ Pr ed ic ta bl e Climate Change  Infrastructure Closure  (Lock Closure) Military Deployments Low High Severe Disruption Impact Ad va nc e  N ot ifi ca tio n Figure 2: Disruption Classification Framework

29 2.5 SYSTEM RESILIENCY FACTORS Accidents, acts of terrorism, financial disasters, natural disasters, and the like can lead to large-scale consequences for a region, its communities and those that live and do business in the affected areas (NAS, 2012). With the uncertainty of the timing and magnitude of many types of disruptions, it is very difficult to be completely certain what, who and where organizational resources will be needed to respond. In the private sector, this has led to the development of business recovery and resiliency plans (Gajjar, 2016). In the public sector, this has led to emergency management plans and protocols, and more generally in the transportation sector a concern for transportation system resilience. Resilience, as defined in the Presidential Policy Directive 8 (White House and DHS, 2011), refers to the ability to adapt to changing conditions and withstand and rapidly recover from disruption due to emergencies. New definitions of resilience and the systems or entities to which resilience refers have been seen in the literature in many different topical areas (NAS, 2012), including resilience concepts applied to ecological systems, infrastructure, individuals, supply chains, financial systems, and communities. At the level of the individual, financial resilience can be defined as the ability to withstand life events, such as unemployment, divorce, disability. and health problems. At the organizational level, it refers to the ability to withstand recessions, stock market meltdowns, acts of terrorism and other jolts to the organization’s way of doing things (O'Neill, 2011). For purposes of this research, supply chain resilience is defined as the adaptive capability of the supply chain to prepare for unexpected events, respond to disruptions, and recover from them by maintaining continuity of operations at the desired level of market position and control over structure and function (Falasca, Zobel, & Cook, 2008). An interesting extension to this definition of supply chain resilience is that it is not just managing risk but also offering an opportunity to be better positioned than the competition to recognize and respond to an event, and even to gain advantage from a disruption (Sheffi, 2005). For example, in the aftermath of the 9/11 terrorist attacks and the likely imposition of more stringent security procedures for the movement of imports into the U.S., several foreign ports were looking at investments to be some of the first ports to meet these requirements so that they would gain a competitive advantage over others. In addition, this research has shown the importance of the roles of both public agencies and private firms in keeping freight flows open when faced with system disruptions that affect both assets and facilities owned by both public and private entities. Social resilience is another important concept in a broader definition of system resilience, which can be defined as the ability of groups or communities to cope with external stresses and disturbances as a result of social, political, and environmental change (Adger, 2000). In the context of this research, social resilience relates to the employees (and their families) that are affected by a disruption, as well as the communities that are immediately adjacent to the impacted area. Based on the literature review, the following factors were identified as contributing to system resiliency:  Physical Infrastructure – infrastructure that enables the physical movement of goods from origin to destination such as road, rail, and pipeline infrastructure; terminals; distribution centers; and warehouses.  Logistical – components of the supply chain that manage and decide logistics arrangements such as network routing, reassigning vehicle/vessel capacity, creating transportation management plans, risk pooling, and the like.  Financial – components such as the capital investment program, potential funding sources, investment decisions for infrastructure improvement, PPPs, and the like.

30  Communication / Transactional / Informational – components such as inter-organization or stakeholder communications, exchange of invoices and payments, emergency communications documentation, communication roles and responsibilities, information gathering, employee education, and the like.  Regulatory / Oversight – components such as lobbying on issues, post-event oversight, public policy updates and changes, promoting national programs and policies, and the like.  Institutional – components such as corporate policies, social and political aspects, and social capital, where each reflects the interpersonal relationships and institutional structures that establish boundaries for interagency and interpersonal interactions. 2.6 POTENTIAL MITIGATION STRATEGIES Various mitigation strategies, i.e. strategies for enhancing supply chain resilience to disruptive events, are discussed in this section for commercial and military operations organized by the resiliency factors identified in Section 2.5. The supply chain resilience guidebook that accompanies this final report provides more information on the types of mitigation strategies that are appropriate for different contexts. 2.6.1 Commercial Operations Moving freight into, out of, and within the U.S. involves cooperation and coordination among numerous public and private sector organizations, from point-of-origin shippers and carriers (and their brokers), to intermediate warehouses and then final customers. The latter includes the nation’s seaports and airports where the goods are imported or exported abroad. State and local government agencies need to be concerned about such movements for the purposes of facilitating trade, ensuring public safety, and supporting environmental stewardship. Developing and sustaining a product supply chain is therefore a multi-actor process, and is only as strong as its weakest link, be it related to physical, logistical, transactional, informational, regulatory, or institutional factors. Physical Infrastructure: Some mitigation strategies deal with structural and inspection components of existing physical infrastructure. Studies performed by Oregon and Washington State discuss mitigation strategies for physical infrastructure that deals with disruption events such as earthquakes and catastrophic bridge failures, including the creation of a statewide inventory of critical buildings in both the public and private sectors, as well as the maintenance of an up-to-date inventory of local transit agency, port, and rail assets (OSSPAC, 2013; WSDOT, 2008). Taking the example of widespread coastal flooding, Hurricane Sandy identified the need to consider future high-water surge events associated with ports and coastal communities. This includes a need to identify physical systems such as electrical grids, storm water outfalls, and road and rail infrastructures for facility hardening, chokepoint removal, capacity building, and increased redundancy (Stevens Institute, 2013). Infrastructure might need to be “hardened” with a range of actions designed to improve the structural integrity of infrastructure (such as the procurement of emergency generators and use of microgrid technology for electrical power (Southworth, Hayes, McLeod & Strauss- Wieder, 2014), as well as developing plans for elevating or redesigning facilities to avoid flooding due to storm surges (Sturgis, Smythe, & Tucci, 2014)). Another strategy is to develop ecological or green strategies, such as developing coastal wetlands to buffer against tidal surges. An example from outside the U.S. is the study conducted by the University College London on the resilience of the United Kingdom (UK) food supply to port flooding on the east coast of the UK. The study included mitigation strategies for enhancing the resilience of physical infrastructure, including improved defenses against flooding such as tidal barriers (Achuthan, Zainudin, Roan, & Fujiyama, 2015).

31 Mitigation strategies for protecting physical infrastructure against longer lead-time threats such as climate change have also seen some interest in recent years. The adoption of new, adaptive design standards will likely have to occur as future climate conditions and the options available for addressing them become better understood. With climate change, we are witnessing stronger hurricanes, an increase in the number of hot days and heat waves, and increases in intense precipitation events, all of which directly affect the infrastructure components of the transportation sector (TRB, 2008). Rehabilitating transportation infrastructure to higher design standards that could withstand changing climatic conditions would have to consider the extent to which network redundancy allows the continued movement of freight while the asset is under construction. An example of asset redesign comes from the Port Authority of New York and New Jersey where facilities considered critical to the operation of the port have been redesigned to withstand larger-than-predicted storm surges (on top of expected sea level rise). Of course, freight transportation is not the only system that relies on physical infrastructure. Military deployments also rely on designated infrastructure within the nation’s strategic highway, rail and seaports networks. A report prepared by the Government Accountability Office (GAO, 2013) looked at how DOD has addressed all Congressionally- directed concerns and issues in its “Report on Strategic Seaports". The report states that it is important to assess the structural integrity and deficiencies of port facilities and determine the infrastructure improvements needed to meet national security and readiness requirements. The report assessed the condition of the landside port infrastructure for all 22 strategic seaports, including roads, bridges, cargo staging and loading areas, rail infrastructure, and berths within the port boundaries. Logistical: Logistical mitigation strategies are also important for all types of disruptions, be they abrupt, rapid or planned. A well-organized logistics strategy increases system and supply chain resilience by helping with faster recovery. Most major freight carriers and shippers have business continuity and emergency response strategies already in place in the event of a supply chain disruption. Many of these plans, however, are organization-centric with little discussion of how a particular organization can interact with other agencies (outside their direct supply chain participants) that control critical infrastructure or services on which supply chains depend. One of the biggest wake-up calls in terms of formulating logistical mitigation strategies for supply chains was the 2011 Japan earthquake and tsunami. The literature on this event and its aftermath shows that it is important to identify the supply chain footprint, not only for critical suppliers, but for all suppliers and sub-suppliers throughout the entire supply chain. Doing so helps increase supply chain visibility for inventory tracking and tracing as well as for physical audits and inspections. It also helps in forecasting expected demand (Rice, 2011; Baymout, 2014). Such a supply chain perspective includes consideration of some of the common components of logistics plans including: Vehicle/vessel re-routing: The most common and thus important mitigation strategy is to reroute cargo whose supply chain is disrupted. This has included vessel re-routing during Hurricane Sandy; barge re-routing during the Columbia-Snake River closure (Southworth, Hayes, McLeod & Strauss-Wieder, 2014); train re- routing during Howard Street Tunnel fire (SAIC, 2002); road traffic re-routing during the Skagit River bridge collapse (Horton, 2015) and the storm-related closure of I-5 and I-90 (WSDOT, 2008); and the many air traffic re-routings due to the September 11, 2001 attacks (IATA, 2011) or during the 2010 Eyjafjallajokull volcano eruption that closed most of the European air space (EUROCONTROL, 2010) Product sourcing and lean supply chains: The literature review revealed that the most affected supply chains during major disruptions were those that relied on a single product source or depended on JIT inventory to create a ‘lean’ delivery system. This points to the importance of developing multiple sourcing strategies rather than relying on one source (Oke & Gopalakrishnan, 2009), where diversifying geographically among sources is done for added resiliency (Baymout, 2014). Moving away from JIT inventory management towards maintaining a “Strategic Emergency Pool” (for example, the Strategic Petroleum Reserve), also helps minimize the effects of a disruptive event (Sheffi, 2002; Sheffi & Rice, 2005; Rose & Wei, 2013). In today’s supply chains, this may include the use of “Sell-One-Store-One” concepts that seek to maintain parts availability within leaner supply chains. The idea is to increase redundancy in parts supply while ensuring that

32 an extra part is always on hand for last-minute customer demands, i.e., a trade-off between too much and too little inventory retention. A similar approach may also better support the need for replacement parts during disruption event-induced emergencies. Likewise, strategies of sourcing a critical part or component from multiple suppliers and storing the item in more than one location is viewed as a prudent strategy to survive major disruptions. A workshop on “Developing Freight Fluidity Performance Measures” examined inventory management strategies that consider freight demand increases and a tightening transportation capacity, with the ability to hold inventory in place mentioned as a practical hedge against transportation constraints (TRB, 2014). Rose and Wei (2013) state that using “Input Substitution”, substituting production process goods that were like those whose production has been disrupted, should be considered, such as the use of natural gas instead of coal in electric utility and industrial boilers. One of the key principles in developing inventory management strategies is to gather and pay attention to the lessons learned from many small-scale disturbances (RAND Corp., 2009). Traffic management: Traffic flow management helps increase resilience by providing alternate routes, targeting strategies for moving commercial vehicles, and implementing communications protocols to make sure all those involved understand the options available for recovering service. For example, the State Route 520 Catastrophic Failure Plan developed by the Washington State Department of Transportation (WSDOT) for one of its most critical bridges talks about the development of a traffic management plan including a toolbox of interdependent strategies to keep people moving throughout the central Puget Sound region in the event of a bridge failure. This includes traffic management strategies for affected corridors, transit service, transportation demand management and system management, and freight considerations to keep commerce moving throughout a region. Other key transit strategies include emergency re-routing procedures, increasing public awareness and incentives, adding park-and-ride capacity, increasing transit service, consolidating transit routes, and reprioritizing service hours (WSDOT, 2008). Transactional/Financial: Financial strategies are important for any mitigation strategy. This includes investing in mitigation projects before a disruption occurs, as well as after a disruption as an aid to faster recovery. A report published by the New Zealand Transport Agency titled “Measuring the resilience of transportation infrastructure” talks about undertaking economic and engineering research to better understand and quantify a suitable level of investment in resilience. Depending on the asset or facilities being considered for resiliency enhancement, significant capital expenditures might be necessary (e.g., a major bridge or harbor terminal). Expenditures might be significant because of multiple investments required over a much larger universe of projects, or expenditures might be more modest where quick fixes or smaller levels of investment on a critically few number of projects could result in improved system resilience (AECOM, 2014). Financial transactions between customers and product carriers very much depend on information technology-based systems that rely on commercial and publicly available communication systems (e.g., communication satellites). Any disruption to these transactions would have significant impacts on the financial position of those involved in the supply chain. The literature review noted that in the absence of a clear and present danger, it is often difficult to secure public funding for projects that are designed to protect against something that might never occur. However, in some cases, new funding might be available given the public awareness of, and the potential magnitude of, the perceived threat. For example, a report by the Oregon Seismic Safety Policy Advisory Commission entitled “The Oregon Resilience Plan” recommends creating a sustained capital investment program for seismic rehabilitation, upgrading transportation routes, and establishing a State Resilience Office (OSSPAC, 2013). In other cases, the most effective funding strategy might be to incorporate resiliency-oriented improvements into project development as add-ons to normal project development costs.

33 The report on Transportation Sector Resilience by the National Infrastructure Advisory Council (NIAC) recommended enhancing public/private partnerships (PPPs) in securing and enhancing the resilience of critical infrastructure and their supporting functional systems. The report identifies PPPs as one of the most important opportunities for supporting infrastructure resiliency projects. Increased involvement of the private sector through PPPs provides incentives for them to get more involved in longer-term strategies to protect their investments against future hazards and threats (Boyer, Cooper, & Kavinoky, 2011). Communicational/Informational: Communication, coordination, and information-sharing are key components of any cooperative effort. The literature review identified various strategies for proper communication and information flow during disruptions. The most important characteristic of effective communication/information dissemination was identified as a prlori coordination among various stakeholders, especially in planning expected response and recovery strategies. The institutional mechanism for doing so were many, such as establishing committees or other coordinating mechanisms. One example noted was the Maritime Transportation System Recovery Unit (MTSRU), which identified a single point of contact (public agency, advocacy group, or industry) through which all information will flow in the event of a maritime emergency (Bynum, 2014; Southworth, Hayes, McLeod & Strauss-Wieder, 2014). Inter-organizational and stakeholder exchange of information can help identify issues at all levels of decision making, from strategic planning to tactical and operational details prior to, during, immediately after a disruption and over a longer-term recovery period. Faster response times and rapid information flows between stakeholders can also lessen the impact of a disruption (Baymout, 2014). Frequent coordination among various agencies and stakeholders also minimizes confusion in areas where jurisdictions overlap (RAND Corp., 2009). The resilience literature talks about setting up various groups or task forces that can help enhance better communication and information flow among stakeholders. An Interagency Port Resiliency Task Force, for example, is often considered necessary to connect the organizations associated with maritime transport with road and rail links and identify chokepoints and critical supply chain paths for energy distribution and freight flow (Sturgis, Smythe, & Tucci, 2014). Establishing stakeholder groups; creating an organizational charter and defining its goals, roles, and responsibilities; establishing communications plans; and creating a contact information database of key personnel are all important components of good communication strategy (Stevens Institute, 2013). Washington State DOT (WSDOT) recommends developing a communications plan that supports emergency response and recovery and that ensures a consistent messaging across agencies. The WSDOT developed a guidebook with recommended guidelines, strategies, and tools for jurisdictions and agencies to disseminate critical information effectively to their constituencies---as well as providing guidelines, strategies and tools for use by its own communications staff (WSDOT, 2008). Siedl and Schweighofer (2014), in their report on inland waterway transport, discuss the use of Information and Communication Technology (ICT) for developing “smart waterways” for inland navigation, river information services, barge planning, and a management information system for inland container shipping: and how the success of ICT depends on collaboration among public and private stakeholders. Another component of good communication/information transfer is enhancing the awareness among stakeholders about various disruptive events and mitigation strategies. Oke and Gopalkrishanan (2009) note that it is important to educate not only employees but also customers regarding risk management and emergency response to disruptions. They also state that promotions and incentives for customers during times of capacity shortfalls or other crises can better allow port operators and carriers to manage the demand for limited cargo-handling resources. Most studies of resilience identify data availability (and data quality) as a critical concern for considering resilience in agency/organization efforts. The literature review and several of those interviewed suggested creating databases to hold critical information that can be used for both resiliency planning or for emergency operations during disruptive events. The Transportation Research Board’s (TRB’s) Disaster Resilience – A National Imperative report discussed developing a “National Resilience Scorecard” through collaboration among public and private stakeholders, led by the Department of Homeland Security (DHS) (NAS, 2012), and encouraging inter-agency sharing of best practices

34 for addressing the potential impacts of various disruptive events. This would include the involvement of professional organizations such as the American Association of State Highway and Transportation Officials (AASHTO), Association of American Railroads (AAR), American Association of Port Authorities (AAPA), American Association of Airport Executives (AAAE) and federal agencies such as the Federal Highway Administration (FHWA), Federal Transit Administration (FTA), Federal Railroad Administration (FRA), Federal Aviation Administration (FAA), MARAD, Federal Emergency Management Agency (FEMA) and DHS. This sharing might include information about vulnerabilities to the supply chain, effective mitigation strategies, and the effectiveness of past contingency plans and infrastructure protection plans (TRB, 2008; DHS/OCIA, 2016). Once various task forces, command centers, and advocacy groups have been established, it is important to improve the effectiveness, transparency, and accountability of such efforts. The Government Accountability Office (GAO) (2016) recommends enhancing the effectiveness of these activities within the context of an Emergency Communications Preparedness Center (ECPC) by clearly documenting the ECPC’s strategic goals and the roles and responsibilities of the ECPC’s member agencies, and by developing a mechanism to track a Center’s successes and failures (GAO, 2016). Effective communication and information flow are also important for emergency military deployments. Some noted it could be the most importance factor in an efficient deployment. A report by the FHWA – Office of Operations provided guidelines for local, state and federal civilian agencies and private companies when working with the nation’s military services during national emergencies and military deployments. Effective communication and coordination of operations between the relevant Military Emergency Operations Center (EOC) and civilian authority centers (which may include a state EOC, a regional EOC and/or a local EOC) is essential to the efficient movement of military convoys both within the continental U.S. and through the nation’s seaports (FHWA, 2005). Regulatory/Oversight: Regulatory/oversight strategies can be an important part of an overall resiliency strategy, especially during a disruption and in a rapid recovery period (when some regulations might be relaxed). Regulatory/oversight strategies have some overlap with communicational/informational strategies as effective regulation and oversight depend on effective communications. It should be noted that some private sector interviewees for the research noted that from a service recovery perspective regulatory and investigation agency actions often “interfere” with the ability to recover from an incident (although there was recognition that such responsibilities were important). The National Cooperative Freight Research Program (NCFRP) Report 30 recommended that protocols need to be developed by the U.S. Coast Guard and Border Protection (CBP) to address the issue of diverted shipments when the destination port is no longer available (Southworth, Hayes, McLeod & Strauss-Wieder, 2014). This recommendation reflected the aftermath of Hurricane Sandy when the Jones Act did not allow foreign-flagged cargo diversion to ports unaffected by the storm (the Jones Act does not allow foreign ships to transport goods between U.S. ports). The report discussed the possibly of a temporary waiver of the Jones Act to achieve a faster and cost- effective means for handling diverted cargo. A temporary waiver with respect to fuel supplies was granted during the emergency; a short-term waiver was also approved after the 2017 Puerto Rico Hurricane Maria. However, such issues are sensitive politically (Oke & Gopalakrishnan, 2009). GAO’s report on Critical Infrastructure Protection also made regulatory recommendations relating to a resilience framework. It recommended focusing on specific milestones, including goals and subordinate objectives, activities, and performance measures. Sources as well as types of resources and contingency investments should be provided alongside any mechanisms for coordinating recovery efforts (GAO, 2012).

35 Institutional: Institutional mitigation strategies include both political and social components. Sadeka et.al, in their paper on social capital and disaster preparedness stated that despite the evidence about its efficacy, resiliency research and disaster management practices have yet to fully embrace social capital as a critical consideration (Sadeka, Mohamad, Reza, Manap, & Sarkar, 2015). The Gujarat (2001) and Kobe (1995) earthquakes showed that communities with high trust, norms, participation, and social networks were able to more quickly to recover from disaster (Nakagawa & Shaw, 2004). A report by Williams (2015) on social resiliency and Superstorm Sandy discussed how to build community resilience. The report stated that it is important to foster local leadership and social networks that connect vulnerable residents to local groups, government officials, neighborhood institutions and service providers in order to develop social capital and preparedness programs in neighborhoods with vulnerable populations. Becker and Caldwell (2015), based on interviews with 57 stakeholders involved in port activities in Gulfport, MS and Providence, RI, also encouraged external-to-the-port stakeholder involvement, and demonstrated that taking a local stakeholder-based approach to data gathering can identify thoughtful and longer-range port resiliency strategies. 2.6.2 Military Operations The physical and logistical issues associated with cargo movements are somewhat similar for both commercial and military cargo moves, at least in concept. However, military deployments occur under a host of regulations and pre- specified federal, state, and local agency roles and responsibilities that place considerable importance on inter- agency coordination and communication. As can be seen in the following discussion of past and proposed military operations, the DOD and USDOT, as well as several other federal, state, and local government agencies, have invested a great deal of effort to improve the physical capacity and inter-agency coordination of freight-handling activities during large scale and rapidly developing military deployments. Physical Infrastructure: Since MARAD’s 2005 report to Congress (ibid, Section 1.1.4), several efforts have been made to address anticipated shortcomings associated with future commercial seaport-supported deployments. On the civilian government side this included efforts by the Department of Homeland Security (DHS, 2006; Bynum, 2014) to ensure the resilience of the maritime system’s physical infrastructure, and MARAD’s efforts to improve military as well as commercial cargo throughput and handling via its Agile Ports program1 and National Ports Readiness Network.2 For the military, this includes a number of Congressionally-requested studies to ensure the readiness and resilience of the nation’s strategic seaports when faced with a significant surge in military cargo (Simpkins et al, 2008; GAO 2007, GAO, 2011, GAO 2013) Transactional/Financial: A GAO report on defense logistics identified six potential sources of funds for infrastructure improvements – port revenues, general obligation bonds, revenue bonds, loans, grants, and other miscellaneous sources (GAO, 2013). The goal was to ensure cargo throughput and build capacity into, through, and out of a seaport. The U.S. military is already spending funds on enhancing and protecting access to military bases in expectation of future climate conditions. However, this investment is not occurring at the port of embarkation where some of the bottlenecks will likely occur. Looking at a mobilization from the total system's perspective might identify areas of critical vulnerability that would benefit from multiple source funding. Logistical/Communicational/Informational: For security as well as efficiency purposes, and with so many different actors playing a part in a military deployment, a great deal of real time communication and coordination is required among stakeholders. These include port and individual terminal operators, commercial carriers, and different branches of federal, state, and local governments (DHS, 2006; JCS, 2013a). Starting with the over-land portion of a 1 https://www.marad.dot.gov/ports/office-of-port-infrastructure-development-and-congestion-mitigation/intermodal-transport- networks/agile-port/ 2 https://www.sddc.army.mil/sites/TEA/Functions/SpecialAssistant/Pages/PortsNationalDefense.aspx

36 military convoy, a state’s Defense Movement Coordinator (DMC) or the state Movement Control Center helps to plan, permit, and provide convoy movement orders, and coordinate over-land convoy movements to and from the seaport of embarkation. This includes obtaining the necessary permits for hauling oversized and overweight vehicles and equipment over public roads.3,4 An issue that requires monitoring is the potential for a shortage of readily available military cargo-compatible, notably chain tie-down flatcars. This a topic that has been on the DOD’s radar for several years (Sones, 2000; Gournley, 2011; Weisgerber, 2013; Pint et al, 2017), recognizing both the steady year on year growth in demand for rail freight services, coupled with the need to replace or upgrade the nation’s existing flatcar fleet. This involves the fleet of commercially available flatcars contracted to the DOD through TTX’s North American rail car pooling operation,5 and which are needed to handle many of the equipment moves during large scale contingencies: adding support to the military’s own (DODX) heavy equipment hauling rail cars.6 Weisgerber (reported by Pint et al, 2017) noted in 2013 that the nation’s commercial flatcar fleet was reaching the end of a 50-year life-span, requiring retirement of equipment under FRA regulations, unless refurbished or otherwise replaced. Recognizing this costly replacement problem, in 2015 the Army procured chains useable with general-purpose commercial flatcars that are equipped with holes for anchoring tie-downs and positioning these chains at major military deployment installations. Even so, having enough flatcars available at any given time is likely to be increasingly impacted by a growing demand for commercial rail services. In 2018 and early 2019 a significant number of news articles pointed to a variety of commercial rail car shortage issues, that in turn may impact the speed with which cars can be made available to the DOD on short notice. In today’s world of increasingly high-tech communications, this also means that cargo movement logistics are heavily dependent on in-transit visibility (ITV) of both the cargo to be moved and the surface lift and sealift assets needed to move it. In short, ITV has become a major resource in the military’s development of efficient, adaptable, and sustainable deployment supply chains (Stribling, 2009). The USTRANSCOM maintains and updates detailed procedures for moving cargo into and through seaports (USTRANSCOM, 2014-2016), and attempts to resolve transportation or logistics conflicts during deployments with ITV reporting via its Integrated Data Environment/Global Transportation Network Convergence (IGC) system This includes communication with deploying units, port and terminal operators, commercial transportation service providers, and service/supply depots. A variety of automated identification technologies (AIT) are used to keep track of both in-transit as well as scheduled cargo details. According to the GAO’s latest update of its “High Risk Areas” (GAO, 2015), the DOD is in the process of implementing initiatives that could serve as a basis for an improved management of its supply chain activities. This includes the Defense Logistics Agency’s (DLA’s) Distribution Effectiveness Initiative to improve logistics efficiencies in DOD’s materiel distribution network and reduce transportation costs by storing materiel at strategically-located DLA supply sites. This also includes establishing metrics and goals to monitor performance for certain segments of its distribution pipeline, such as “time definite delivery”, which measures the probability that a customer will receive an order within an established time period. Another measure includes customer wait time or the total elapsed time between issuance and actual delivery of an order (GAO, 2015, page 189). 3 See https://ops.fhwa.dot.gov/publications/fhwahop05029/chapter_2.htm NB. Some information in this report is dated. 4 https://www.sddc.army.mil/sites/TEA/Functions/Deployability/TransportabilityEngineering/MODES/HighwayTransport/ Pages/CONUS.aspx 5 TTX is a private company owned by nine of North America’s major railroads and functions as the industry's railcar cooperative. https://www.ttx.com/ 6 While most commercial flatcars have a 70 ton or so capacity, DODX cars are 100-ton and 140-ton capacity cars (For more details see Armstrong, 2016).

37 Regulatory/Oversight/Institutional: Regulations, oversight, and institutional roles during military deployments have been the subject of a great deal of legislation for both military and civilian branches of government. Keever and Soutuyo (2005) review in detail and stress the importance of inter-agency cooperation in the form of an FHWA- supported guide for state and local government agencies involved in military deployments. They identify six “key agencies” or agency types that need to be involved in such deployments: the state DOT; state and local departments of public safety and law enforcement; the port of embarkation; the military units deploying; state, regional and local emergency management agencies; and the state’s DMC. Institutionally, USTRANSCOM uses what it terms the Single Port Manager (SPM) approach for all worldwide common-use seaport operations. Upon receipt of military movement requirements, the SDCC acts as the SPM for military deployments, assigning workload to military ocean terminals and (contracted) commercial port facilities, taking responsibility for the “strategic flow of deploying and redeploying forces, unit equipment, and sustainment supply in the Seaports of Embarkation (SPOEs) (JCS, 2013a). However, as members of the National Port Readiness Network (NPRN), nine federal agencies – the Military Surface Deployment and Distribution Command (SDDC) and the Military Sealift Command (MSC), U.S. DOT’s MARAD, the USACE, the U.S. Coast Guard (USCG), the U.S. Army Forces Command (FORSCOM), U.S. DOT’s Transportation Security Administration (TSA), and the U.S. Army’s Northern Command – have also evolved specific responsibilities in support of the secure movement of forces through U.S. ports during military contingencies. At each of the 17 designated “strategic commercial ports” representatives of these nine agencies establish Port Readiness Committees, chaired by the USCG Captain of the Port, which is charged with port operations during national defense emergencies. 2.7 CONCLUSIONS Understanding the characteristics of a disruptive event is a prerequisite for developing effective resiliency planning or mitigation strategies. This process can usefully begin by classifying a disruption event according to the classification presented in this section. This means considering the nature of the event’s lead time (abrupt event, rapid event or planned/predictable event), and disruption impact (severe impact, high impact or low impact based on geographical scope, level of loss and military involvement). Various mitigation strategies were identified in the literature review according to physical, logistical, transactional/financial, communicational/informational, regulatory/oversight, and institutional resiliency categories. Inter-agency and inter-group communication are arguably the most important factor for fast and efficient recovery from a disruptive event. Effective communication and collaboration are needed not only among public agencies, but also among the many different stakeholders and transportation system users, especially in the freight sector. Communities, which can be either directly or indirectly affected by a disruptive event, also need to be part of the advance planning. Importantly, procedures for developing lessons learned from past disruptive events should be established while planning for the next event. As far as freight transportation is concerned, physical strategies include ensuring the continued operation of ports, railroads, roadway, and inland water infrastructure. Contingency plans should investigate the strengthening of existing infrastructure, as well as building new (more protected) infrastructure capacity, if resources allow. Such plans should also establish and monitor the availability of emergency services, each of which may become critical bottlenecks during recovery operations. Other actions that have been proposed include updating infrastructure design standards (for example with respect to climate change and sea-level rise) and creating a database of critical infrastructure components, including public transit, port, highway (trucking), and rail assets and their operational responsibilities during contingencies by private sector organizations as well as federal, state and local agencies. Some literature examined the topic of social resilience, but it was difficult to find literature specific to social disruption impacts on communities. Similarly, there is a lack of literature on the institutional components of supply chain resiliency. For example, the bankruptcy of Hanjin Shipping Lines in 2017 occurred during the research and hence it was difficult to find peer-reviewed literature that talks about mitigation strategies for such events.

38 The literature review also showed the lack of information on the cascading effects of not prioritizing certain essential systems such as electrical power, water, communications and fuel. The need to create a “priority decision tree”, which will help rank the systems that start malfunctioning during and immediately after a disruptive event, was suggested by some authors. This would provide faster and more cost-efficient recovery and would avoid the cascading failures of other interdependent systems. The special case of military cargo surges through strategic seaports was also reviewed. The nation’s commercial waterborne fleet is an essential component of the U.S. military’s deployment and operation plans. At the same time, commercial shipping might benefit from a better understanding of the military’s cargo tracking and communications systems concerning both cargo details and the location and condition of the physical assets needed to move such cargo. Inter-agency coordination is clearly a key to success in moving both personnel and materials through U.S. ports in a time-sensitive (and cost-effective) manner. Such communication would benefit from a better understanding of the limitations in capability that each of the involved parties have during periods of joint commercial and military cargo movement. Recent literature on the general topic of under-capacity ports during cargo surges has promoted the use of standardized port performance measures that can be used to capture and, to the extent useful, quantify various concerns (GAO, 2012; TRB 2012; Caldwell, 2012; Brooks, 2015). Some work, already available in this area, might be adapted to capture worst-case or “sealift surge” conditions during periods such as joint military-commercial cargo operations within a port (for example, Bichou and Gray, 2004; AAPA, 2012; Brooks and Schellinck, 2015; Schellinck and Brooks, 2016).

Next: Chapter 3: System Resiliency Scenarios and Case Studies »
Freight Transportation Resilience in Response to Supply Chain Disruptions Get This Book
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TRB’s National Cooperative Freight Research Program (NCFRP) has released a pre-publication version of Research Report 39: Freight Transportation Resilience in Response to Supply Chain Disruptions. The report provides guidance to public and private stakeholders on mitigating and adapting to logistical disruptions to supply chains resulting from regional, multi-regional, and national adverse events, both unanticipated and anticipated.

The report, which makes a significant contribution to the body of knowledge on freight transportation and system resiliency:

(1) assesses research, practices, and innovative approaches in the United States and other countries related to improving freight transportation resiliency;

(2) explores strategies to build relationships that result in effective communication, coordination, and cooperation among affected parties;

(3) identifies factors affecting resiliency;

(4) analyzes potential mitigation measures;

(5) characterizes spatial and temporal scale considerations such as emergency planning and response timeframes;

(6) prioritizes response activities by cargo types, recipients, and suppliers;

(7) identifies potential barriers and gaps such as political boundaries, authorities, ownership, modal competition and connectivity, and social and environmental constraints; and

(8) examines the dynamics of supply chain responses to system disruptions.

The report also includes a self-assessment tool that allows users to identify the current capability of their organization and institutional collaboration in preparing for and responding to supply chain disruptions.

Disruptions to the supply chain and their aftermath can have serious implications for both public agencies and companies. When significant cargo delays or diversions occur, the issues facing the public sector can be profound.

Agencies must gauge the potential impact of adverse events on their transportation system, economy, community, and the resources necessary for preventive and remedial actions, even though the emergency could be thousands of miles away.

Increasing temporary or short-term cargo-handling capacity may involve a combination of regulatory, informational, and physical infrastructure actions, as well as coordination across jurisdictional boundaries and between transportation providers and their customers.

For companies, concerns can include such issues as ensuring employee safety, supporting local community health, maintaining customer relationships when products and goods are delayed, and ultimately preserving the financial standing of the company.

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