Towards Defence Supply Chain Disruption Management

What is the issue?

In recent years, global headlines have repeatedly cited significant, severe disruptions to global supply chains that are of a new and arguably unprecedented scale. Although the likelihood of these “one-in-100-year events” has been perceived to be quite low, the rate of their occurrence has seemed to increase in recent years. Causes of supply chain disruptions span such events as volcanic eruptions, the coronavirus pandemic, ransomware attacks, U.S. sanctions on China, and the cascading impacts of the Russian invasion of Ukraine, and the increasing number of these events has demonstrated that disruptions can propagate quickly through supply chains, crippling companies’ operations and ability to deliver goods and services. An interest in addressing the threat that these severe, unanticipated disruptions can pose to supply chains has consequently become increasingly prominent.

How did we help?

The authors’ goal was to understand how defence supply chains can better withstand unanticipated and highly impactful disruptions whose probability and impact cannot be readily calculated or quantified. Specifically, the project team set out to identify the current state of the research on supply chain risk management (SCRM), supply chain disruption management (SCDM), and supply chain resilience, both within the defense sector and across the broader commercial landscape.

The project team therefore conducted an extensive review of academic literature, as well as conducting interviews and workshops with experts on both sides of the Atlantic to explore the unique characteristics of defense sector supply chains. This included the ways in which practices from other sectors might or might not be applicable, as well as identifying knowledge gaps or broader questions that might not appear in the literature. This study was co-led by RAND and the Swedish Defence Research Agency (Totalförsvarets forskningsinstitut [FOI]).

What did we find?

The authors found that more research is required to identify good strategies for SCDM for defense, as well as to identify how supply chain specialists and defense and security policymakers might implement these strategies across both the private sector and government. The authors therefore created a research agenda to help fill existing gaps in understanding how defense supply chains can better resist and recover from disruption.

The research agenda covers five key areas to help fill gaps in understanding of how defence supply chains can better resist and recover from disruption:

1. Improve understanding of supply chain disruption, including the composition of defence supply chains and its associated stakeholders and actors;
2. Determine which commercial sector approaches to SCDM can be adapted for or adopted by defence;
3. Recognize and tackle challenges for SCDM stemming from the multisectoral nature of defence supply chains;
4. Clarify and distinguish between SCRM and SCDM to understand the benefits and challenges of each; and
5. Define what resources are needed to enable implementation of defense SCDM.

Read the full study