UBC Theses and Dissertations

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UBC Theses and Dissertations

An evaluation of the value of security in the international marine supply chain Loke, Wai Leng


Since the events of 9/11, there has been tremendous amount of renewed interests in the study of trade security. There has been an influx of security regulations and the private sector has been trying to keep pace in complying with them. However, due to the public externalities of security improvements and the lack of quantified and proven benefits, the private sector is struggling to establish business cases for their security initiatives. There is very little quantitative research in this area. Using exploratory factor analysis (EFA) and structural equation modeling (SEM), this study serves to fill this gap by introducing a statistical way of analysing and understanding the complex relationships amongst security effort, its motivators and performance and traditional supply chain performance (SCP). This study also proposes an evaluation framework for security efforts. EFA results show that security is a dimension of SCP. This means that organizations have all along been measuring an aspect of their operations that relates to security. As such, organizations should not perceive the current heightened interests in security as throwing them off-balance. In evaluating security efforts, organizations should select key performance indicators (KPIs) that represent each of the four areas of information, cargo, people and cost. SEM results show that organizations undertake security efforts as a result of both perceived security benefits and perceived collateral benefits, with perceived security benefits carrying a greater weight in the decision-making process. Results also show that organizations are implementing security initiatives out-of-compliance i.e. implementing initiatives that they perceive as not having significant impacts on security and SCP. In view of the positive relationships among perceived security impact, security effort and security performance, there is further imperative for an objective method for evaluating security efforts to prevent effort justification behaviour in determining the effectiveness of the same. Results also show that organizations perceive an improved performance in security leads to an overall improvement in SCP. However, as with other supply chain strategies, there are tradeoffs and not all aspects of SCP are impacted in the same way. Time, responsiveness and efficiency for instance are negatively impacted while reliability is positively impacted.

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