Enterprise Risk Management in the Global Supply Chain PDF by Thomas A. Cook

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Enterprise Risk Management in the Global Supply Chain
By Thomas A. Cook
Enterprise Risk Management in the Global Supply Chain

Contents
Foreword.............................................................................................. xiii
Preface.................................................................................................... xv
Acknowledgments...............................................................................xvii
Chapter 1 Defining the Global Supply Chain and Enterprise
Risk Management................................................................ 1
Overview of Risk Management and the Global
Supply Chain..................................................................................1
Enterprise Risk Management.......................................................4
Driving Risk and Spending from the Global Supply Chain....9
Key Challenges in the Global Supply Chain............................10
Risk Defined.................................................................................11

Managing Cultural Issues in Global Trade..............................13
Business Culture.....................................................................14
Considering Cultural Factors................................................14
Some Interesting Case Studies in Global Risk........................18
ARM Manufacturing, Ohio/Kobe Japan, 2011, Tsunami.....19
Rathen Industries, New York/Russia, 2014,
Trade Compliance...................................................................19
Durkee Foods, Netherlands/New Orleans, 2005,
Hurricane................................................................................ 20
Bering Communications, California/Sudan, 2015,
Political Risk, Kidnap and Ransom, IT Security................21
Global Energies, New Jersey/China, 2016,
Foreign Corrupt Practices Act (FCPA)................................22
Deneson Products Corporation, Florida/Venezuela,
2014, Cargo Risk.....................................................................22
Case Study Summary.............................................................23

Training....................................................................................24
Chapter 2 Global Risk Management................................................. 25
Global Supply Chain Risk Verticals..........................................25
Property, Casualty, Workers’ Compensation, Auto,
Fiduciary, etc. (“Supply Chain Focus”)................................26
Political Risk.................................................................................27
Confiscation, Expropriation, Nationalization,
and Deprivation (C, E, N, and D)........................................ 28
Contract Repudiation, Default, Currency
Inconvertibility, and Devaluation........................................29
Receivable Management............................................................ 30
Security and Terrorism...............................................................31
Physical Assets........................................................................31
Corporate Terrorism Best Practices.....................................35
Foreign Corrupt Practices Act (FCPA) and Antibribery.......37
FCPA Corporate Compliance Program...............................41
Antibribery............................................................................. 44
Conflict Minerals........................................................................ 46
U.S. Securities and Exchange Commission Guidelines....... 48
Personnel.......................................................................................53
Kidnap and Ransom Exposures...........................................59
Training................................................................................... 60

Areas of Training.............................................................. 60
Chapter 3 Global Trade Risks............................................................ 61
Technology and Cyber Issues....................................................61
U.S. Government Program for Safeguarding
and Securing Cyberspace.......................................................62
CSI, C-TPAT, and ISF: U.S. Customs and Border
Protection’s Security Programs.................................................71
Contract Management................................................................77
Financial.......................................................................................82
International Payment Terms...............................................83
Currency..................................................................................89
Geophysical, Environmental, Sustainability...........................92
Going Green............................................................................94
Corporate Reputation Branding and Marketing..................101
Reputational Risk Exposures..............................................102
IPR (Intellectual Property Rights)..........................................103
Chapter 4 Supply Chain and Logistics............................................ 109
INCO Terms...............................................................................109
Sourcing and Purchasing..........................................................115
Logistics......................................................................................119
Foreign Trade Zones (FTZs)...............................................119
Bonded Warehouses............................................................ 120
Free Trade Agreements........................................................121
Logistics Bidding..................................................................121
Freight.................................................................................... 124
Reducing International Supply Chain Costs
without Beating Up Your Carrier or Service Provider....127
When a Major Carrier Goes Bankrupt: Managing
the Aftermath and Future Loss Preventive Measures.....129
Loss Prevention................................................................130
Global E-Commerce.................................................................132
Trade Compliance.....................................................................137
Buying Internationally: Import Supply Chain.................138
Duties and Fees................................................................138
Harmonized Tariff Classification..................................142
Country of Origin Marking...........................................143
Trade Compliance............................................................143
Reasonable Care Standard..............................................144
Customhouse Brokers.....................................................149
Internal Supervision and Control..................................152
Supply Chain Security.....................................................153
Invoice Requirements..................................................... 154
Bonds.................................................................................156
Record Retention..............................................................156
Selling Internationally: The Export Supply Chain...........157
Government Agencies Responsible for Exports..........158
International Traffic in Arms Regulations...................158
Export Administration Regulations.............................159
Commerce Control List...................................................160
Electronic Export Information......................................160
U.S. Principal Party in Interest......................................161
Schedule B Number/Harmonized Tariff Number.......162
Valuation...........................................................................163
Record-Keeping Requirements......................................163
Denied Party Screening..................................................164
Embargoed Country Screening.....................................164
Breakdown of the Consolidated Screening List...........168
Consularization and Legalization.................................169
Solid Wood Packing Material (SWPM) Certificates......170
Preshipment Inspections.................................................170
Free Trade Affirmations..................................................171
Getting Paid......................................................................172
ATA Carnets...............................................................................172
Summary of Logistics Considerations....................................173
The Six Steps..........................................................................173
Choose the Best INCO Term..........................................174
Insure the Shipment.........................................................175
Chose the Right Freight Forwarder and Carrier.........176
Track All Shipments Proactively....................................177
Understand the Total “Landed Costs”..........................178
Be Trade Compliant!........................................................179
Summary...........................................................................180
Chapter 5 International Insurance and Global Risk
Management.................................................................... 181
Marine Insurance......................................................................181
Geographic Areas Covered..................................................183
Named Insured.....................................................................183
Modes of Transit Covered...................................................183
Limits of Liability..................................................................184
Valuation................................................................................184
Underwriting Terms.............................................................185
Special Terms.........................................................................185
War and SRCC Coverage.....................................................185
Terrorism...............................................................................186
Effective Dates.......................................................................186
Storage/Warehousing...........................................................186
Consolidation and Deconsolidation..................................186
Domestic Transit...................................................................187
Interruptions in Transit.......................................................187
Exclusions..............................................................................188
Loss of Market..................................................................188
Delay..................................................................................188
Business Interruption or Consequential Damages.....188
War SRCC.........................................................................188
Inadequate Packing.........................................................188
Cancellation...........................................................................192
Commercial Insurances Overview.....................................192
Property Insurance...............................................................193
Liability Insurance................................................................194
Crime and Fiduciary Liability Insurance..........................194
Cyber Liability Insurance Coverage...................................195
International Directors and Officers Liability
Insurance...............................................................................196
Excellent Resources for International Insurances............196
Chapter 6 Structuring a Global Supply Chain Risk
Management Best Practice Strategy............................... 197
The Ten Step Master Plan.........................................................198
Step 1: Determine a Point Person.......................................198
Step 2: Obtain Senior Management Support
and Authorization................................................................199
Step 3: Create a Committee of Stakeholders.................... 200
Step 4: Perform an Assessment.......................................... 202
Step 5: Come Up with a Plan of Attack............................ 203
Step 6: Develop Resources.................................................. 204
Step 7: Outreach to All Fiefdoms....................................... 204
Step 8: Create SOPs.............................................................. 205
Step 9: Start Internal Training Programs......................... 206
Step 10: Ascertain Audit Capability.................................. 207

Resources....................................................................................211
Credits.........................................................................................218
Appendix A: Glossary of Business Terms.......................................... 219
Appendix B: Glossary of Business Contract Terms.......................... 229
Appendix C: Glossary of International Trade Terms ....................... 235
Appendix D: Acronyms....................................................................... 247
Appendix E: Cybersecurity................................................................. 249
Appendix F: C-TPAT’s Five Step Risk Assessment............................ 267
Appendix G: Conflict Minerals Reporting Form...............................311
Appendix H: Professionalism Service Managers at U.S. Customs
and Border Protection ........................................................................ 323
Index..................................................................................................... 327
About the Author................................................................................. 335

Preface
In the past 30 years, more companies have begun to develop sourcing and purchasing initiatives in foreign markets. Additionally, U.S.-based export sales have grown to their highest levels. What this growth means is increased exposures. Tied into this increase is a general lack of experience for those executives engaged in global trade with understanding international and supply chain risks and providing cost-effective solutions to their companies benefit.

This book outlines all the critical issues in understanding global risk management and establishes a workable structure, outline, and action plan for corporate executives as a blueprint to follow.

The primary deliverables of the book are

• Comprehension of the risks in global supply chains
• Enterprise solutions
• Cost-effective, functional, and hands-on skill set development to manage risk, insurance, and loss control in international operations, purchasing, and sales
• Addressing the increasing concerns over global security and cybersecurity

Business people need to understand the psychology of risk more than the mathematics of risk.

It is US$10. To get this book send email: textileebooks@gmail.com

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