Ellingsworth 1

Sabastina Ellingsworth
Narkon and Lancaster
Fund. Transportation and Logistics Management
4 June 2018

Critical Issues Facing Transportation or Logistics Organizations

Transportation connects people to jobs, family, entertainment, education, tourism, and the
goods and services needed for everyday life. It is also the activity that physically connects
businesses to their supply chain partners and to their end users. The backbone of any
organization’s sustainable supply chain relies on reliable transportation and logistics networks;
however, organizations are faced with critical logistics or transportation threats from terrorism,
cybercrimes, and natural disasters. This research paper will elaborate on the impacts of those
threats to transportation or logistics organizations and will provide some recommendations that
could help solve these issues.
Throughout the world, transportation is the most common target of terrorist activity
because people gather in vehicles, terminals, and airports. From the disruption of pipelines in oil-
producing countries to the use of vehicle explosive devices or the hijacking of ships,
transportation assets can be particularly difficult to secure and, thereby, are vulnerable to attack.
William E. Biernatzki defines terrorism as “the exercise of violence or the threat of violence
against an unarmed and/or unsuspecting population to coerce it to meet the demands of the
aggressor.” As groups or individuals are motivated to terrorize or injure people, most assuredly,
they would have a transportation element in an overall plan of terrorism. Transport vehicles and
facilities, from aircraft to rail terminals, are repeated targets of terrorist attacks, hijackings, and
sabotage. There are a few locations and gateways that are mainly vital to the smooth flow of a
transportation organization’s supply chain. Therefore, potential attacks on these locations and
gateways could lead to a shutdown of trade, travel, or bring an entire transportation
organization’s supply chain to a halt.
An organization’s transportation or logistics gateway is vital. An airport, railroad, or
seaport gateway closed due to a threat of terrorism can be an issue to all cargo leaving that
location. For example, if an organization’s transportation gateway like the seaports or airports
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that serve as international gateways were attacked, the consequences for international trade flows
could be a lot more severe. As another example, a full container carrying raw materials moves
through the bridges over the Columbia or Mississippi River. A disabling attack on one of those
bridges would be devastating therefore, resulting in a massive loss for the transportation
organizations. Also, chokepoints where there is only one narrow way across a channel, valley, or
bridge, could be potential weak points for terrorism. When these chokepoints are attacked, it
could lead to a slow down in deliveries, which would cost the organizations huge sums of
money, especially if the ship or truck is carrying perishable goods.
As transportation or logistics organizations import and export goods or raw materials
from other countries, disrupting traffic, for example, would slow down freight flows
significantly. An instance is September 11, 2001, where some individual groups of terrorists
carried out suicide attacks against the United States. The result of the attacks brought
international business between the United States and the rest of the world to a halt. Both
domestic and international air transportation ceased and flights were suspended. Wolfgang
Lehmacher, head of Supply Chain and Transport Industries, World Economic Forum mentioned
that “after the terrorist attacks on 9/11, the federal government closed airports, canceling
thousands of flights at a direct cost to airlines.” By these decisions, the impact extended to all
global firms conducting business across U.S. borders. These decisions by the U.S federal
government could cause ocean vessels loaded with containers to be prevented from loading or
unloading in major U.S. ports, which could force many ships to anchor off the coast and wait
days to be loaded.
A mere threat of terrorism can cause tourists to rethink their decisions to visit
destinations. With respect to Lehmacher’s point, Steven E. Polzin, Ph.D., Program Director of
Mobility Policy Research said that “after September 11th, trip making declined as people chose
to forgo certain trips” (8). Fear gripped many travelers in America and other countries. “Even
when the airports re-opened, tourists were wary of air travel, and airlines experienced at least a
30% reduction in demand during the initial shock period” (Lehmacher). The slowdown of
businesses and cancellations of many flights caused the airlines and tourism industries a great
loss of money. Also, a terrorist attack at port is a danger to an organization’s security. It could
severely disrupt the supply chain, which would be catastrophic to the U.S. economy.
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Another threat to an organization’s transportation or logistics supply chain is

Electromagnetic Pulse (EMP), which was described by August Neverman as a “wave of
electromagnetic radiation….an EMP interacts with power lines, metal, conductive materials and
electronics, and can cause system failure. A large one could knock out power or kill electronics.”
This implies that an EMP attack on the U.S. soil or any other country would leave the country
with no electricity, no communications, no transportation, no fuel, no food, and no running
water. This kind of attack and any other kind of terrorism creates fear and horror in society and
poses harm in many areas, mainly the country’s economy and organization’s transportation or
supply chain. These kinds of attacks can also affect an organization’s supply chain and its factor
of production such as labor, capital, land, and entrepreneurship significantly.
Furthermore, with the remarkable digital growth, transportation and logistics
organizations face the issue of cyber threats. A cyber-attack is described by Check Point
Software Technologies Ltd as a “strike against a computer system, network, or internet-enabled
application or device.” There are widespread cyber threat networks that will connect with
autonomous vehicles, the financial networks that process tolls and parking payments, the
roadway sensors, cameras and traffic signals, the electricity grid, and even our personal home
networks. For instance, Uber has self-driving cars on the road. These attackers can hijack the
computerized system of these self-driving cars or trucks and cause havoc. Danielle Muoio gave
an example by saying that, “a self-driving car at night might be programmed to rely more on its
lidar system since the cameras can't see as well in the dark.” Muoio’s article quoted Petit, who
said, “if a hacker were to then spoof the lidar, the sensors don't have as much data to fall back on,
and it could put the car and its passengers in a dangerous situation.” This indicates that cyber
attackers can use computer technology to access personal information, organizational trade
secrets, or use the internet for malicious purposes. They can also use computers to communicate
and document data storage such as financial information, intellectual property to disrupt an
organization’s operations or security system.
A cyber-attack can also cause physical destruction. A cyber attacker could hijack the
energy supply power grid or break into the traffic control systems, and the disruption would lead
to chaos. The disruption could also affect an organization’s supply chain, stop its production
lines, cause a delay in deliveries, or cause a traffic jam. An attack on transportation or logistics
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information technology security systems can create a widespread domino effect and greatly
compound the threat. A hacker could infiltrate the flight control systems and randomly let
airplanes fall from the sky or reset the tracks in rail traffic and let trains crash. For instance, the
Malaysia Airline Flight 370 was hijacked, and the plane was directed to the ocean killing 237
passengers on board. This kind of activity can greatly slow down transportation activities, cause
panic among the travelers, or shut down the entire organization’s supply chain. Rail
infrastructure, airlines and airport infrastructures, transportation operators, and automobile
suppliers all face the possibility of a cyber-attack interrupting their networks and causing
significant disruption.
Claus Herbolzheimer is a partner in Oliver Wyman's digital practice and Max-Alexander
Borreck is a principal in transportation. Both said, “when Danish shipping giant A.P. Moller-
Maersk’s computer system was attacked on June 27 by hackers, it led to disruption in transport
across the planet, including delays at the Port of New York and New Jersey, the Port of Los
Angeles….” The rail industry, as well as the airline industry, may be targeted by cyber attackers
with intent to cause disruptions as it happened to Danish shipping. The damages cyber-attacks
pose to an organization’s profits, reputation, brand, competitive position, and even operational
ability is potentially huge.
In addition to the dangers of terrorism and cyber-attacks, the transportation sectors are
increasingly vulnerable to natural disasters as far as organization’s supply chain safety is
concerned. Disasters, such as tornadoes, earthquakes, volcanoes, and hurricanes, can cripple an
organization’s transportation and its logistics supply chains. They can affect the railways,
airlines, trucking, or land industries as well. Even more serious and threatening disasters like
wildfires, floods, and other similar catastrophes can wipe out the population and any kind of
business organization in seconds. Natural disasters can put an organization in a position to lose
its supply chain partners, employees, or a significant manager. Disasters can also cause business
contracts with suppliers to be broken when business environments become severely unfavorable
for operations.
When a natural disaster occurs, places such as the air transport and public transit systems
are usually shut down, and land transportation can be seriously impaired. The cities of New York
and the state of New Jersey “were hit by widespread flooding, strong winds, electrical blackouts,
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and fires. Subway tunnels have been flooded and public transport is at a standstill, schooling is
shut down and many parts of the cities remain underwater” (The Guardian). The cities of New
York and the state of New Jersey’s widespread flooding led to the shutdown of airports, seaports,
and the public transit systems. This kind of disaster regularly impacts the performance of
transport systems and their ability to provide fast delivery of products and services, especially in
emergency situations. “Hurricane Harvey’s broad swath across Texas will strongly affect over
7% of U.S. trucking over the next month and beyond” (qtd. in MercuryGate). Also, the flooding
and power outages caused by Hurricane Harvey could take several days for the system to be
brought back to normal operating conditions. These conditions can have substantial impacts on
commuting and organizations that use power to produce their products. Overburdened roadways,
railways, and port facilities due to floods can impede product flows and create holdups in the
supply chain.
Disasters can happen either through terrorist attacks, cyber-attacks, or natural disasters.
When these disasters happen, organizations’ transportation or logistics are threatened, and supply
chains are impacted. The following recommendations could help solve or limit the challenges
transportation or logistics organizations face.
First, these organizations should improve their abilities to detect and address any kind of
malicious activities involving terrorism, cybercriminals, and ballistic nuclear threats. This can be
done by using an explosive trace detection to detect any explosive particles. Also, an X-ray that
will capture computer images of the cargo content and display on a monitor for the screener to
detect any anomalies that could be threat items can be used. The companies should also make
sure that employees who will play roles in an emergency are trained for this emergency response.
Training should be coordinated with the state emergency operations center.
Second, since terrorism activities and disasters are unpredictable, the transportation or
logistics organizations should develop contingency plans for off-site emergency responses. For
instance, they need to identify an alternate emergency facility for their office staff and ensure
that the office will have access to the necessary data, records, suppliers’ information, and
services to support disaster response at that remote location. The contingency plans should also
address communication in terms of land phone, cell phone, and radios, computers, and backup
electronics issues.
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Third, documentation is important during and after any disasters. Therefore, these
organizations should maintain detailed logs of all purchase orders from their suppliers or supply
chains, activities, approvals of any agreement, and any correspondence relating to purchase
requests from their suppliers. They should also maintain a current centralized listing of registered
prospective suppliers who can supply specific emergency needs and deliver to end users.
Fourth, the losses and damages involve in these disasters are huge. The MercuryGate
claims that, “the economic damage created by Hurricane Harvey has risen to $75 billion, which
includes property damage……” (qtd. in Moody’s Analytics). Therefore, in the era of ever-
present attacks and breaches by cyber attackers and terrorism, logistics organizations should
consider purchasing cyber insurance or disaster insurance to cover business interruption losses
arising from cyber events, disasters, or any kind of terrorist attacks. The transportation industry
has already experienced some notable cybersecurity incidents involving malwares, computer
cookies and viruses. “In 2003, the Sobig virus infected a railroad company’s computer system,
shutting down signaling, dispatching and other systems and causing train delays” (IBM Security
5). So, since cyber attackers can break through organizations’ computer systems and use cookies
to prone viruses, precautions should be taken by installing security systems.
Finally, when disasters happen, businesses must still move on. For transportation and
logistics organizations to operate smoothly during and after disasters, they should open lines of
communication between internal departments and extend supply chain partners. Proactive
planning is essential to respond to challenges as they arise. They should also consider alternate
routings, ports of call, and intermodal options to keep shipments moving if access to transport
goods and services becomes impossible.
I would, therefore, like to conclude by saying that the world is becoming smaller. Supply
chains of today’s companies have globalized due to increasing efficiency in transport and
logistics. Supply chains will come under increasing attack, and logistics hubs and chokepoints
will be preferred targets. Therefore, transportation or logistics companies need to be aware and
prepared. Supply chains must be secured against any form of terrorism and natural disruption.
Transportation and logistics companies will need to take security concerns into account when
choosing transport routes. They should also be proactive and be prepared to respond quickly if
risk, or threat levels rise, or change.
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Executive Summary
Organizations’ transportation or logistics are used to get the right goods from the right
place and distribute them to the right people at the right time. These organizations security are
regularly subjected to breach attempts by an individual terrorist or organized group attackers,
natural disasters, or cyber-attacks. Terrorist attacks can also disable critical infrastructures, which
could cause economic hardship for these organizations and consumers who depend on that
infrastructure. For instance, an attack that destroys bridges over the Columbia River could lead to
massive losses for the organization’s supply chain due to the lack of passage of roads.
With the modern advancement of technology, cyber-attacks have become a threat to
organizations and their supply chain. As more organizations’ devices and control systems are
connected online, more vulnerabilities will appear, increasing the potential for disruption from
the cyber attackers. These attackers hijack plane computerized systems, as well as computerized
self-driving cars or trucks or the energy power grid to cause disruptions. These activities can
greatly slow down the entire supply chain, or shut down the entire production plant, slow traffic,
and cause panic among the people. A natural disaster is another threat to transportation or
logistics organizations. It can also result in disruptions in the suppliers or organization’s
production processes and can affect the transportation and distribution of goods and services to
the consumers.
After disasters, organizations face a multitude of challenges, including how to finance
business recovery and often how to cope simultaneously with damages to both businesses’
properties and pieces of equipment. Addressing the safety security issues helps regarding the
terrorism, natural disasters, and cyber-attacks that transportation and logistics face.
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Works cited
Biernatzki, William E. "I. Definition: what is terrorism?" Communication Research Trends, vol.
21, no. 1, 2002, p. 3+. Academic OneFile,
http://link.galegroup.com.proxy.chemeketa.edu:2048/apps/doc/A130933223/AONE?u=or
egon_chemeke&sid=AONE&xid=3a8a43b1. Accessed 12 May 2018.

Check Point Software Technologies Ltd “What is a Cyber Attack?” Check Point Software
Technologies Ltd. https://www.checkpoint.com/definition/cyber-attack/. Accessed 13
May 2018.

Herbolzheimer, Claus and Max-Alexander Borreck. “Time For Transportation & Logistics To
Up Its Cybersecurity As Hackers Put It On Target List.” Logisticss & Transportation
#CyberSecurity. Forbes. (Jun 28, 2017).
https://www.forbes.com/sites/oliverwyman/2017/06/28/time-for-transportation-logisticss-
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2018.

IBM. “Security trends in the transportation industry.” IBM Security, 2016, https://www-
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2018.

Lehmacher, Wolfgang. “How safe are our supply chains from terrorist attack?” The World
Economic Forum. Dec. 11 2015. https://www.weforum.org/agenda/2015/12/how-safe-
are-our-supply-chains-from-terrorist-attack/. Accessed 17 May 2018.

MercuryGate. “When Storms Rage: How to Protect Your Supply Chain from Natural Disasters.”
MercuryGate. https://mercurygate.com/the-gateway/protect-supply-chain-natural-
disasters/. Accessed 12 May 2018.

Muoio, Danielle. “Self-driving cars are prone to hacks — and automakers are barely talking
about it”. Business Insider. Dec. 15 2016. http://www.businessinsider.com/driverless-
cars-hacking-ricks-2016-12. Accessed 12 May 2018.
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Neverman, August. “Electromagnetic Pulse (EMP) – What You Need to Know”. Common Sense
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emp/.m. Accessed 13 May 2018.

Polzin, P. E. Ph. D., Steven E. “Security Considerations in Transportation Planning: A White

Paper”. Center for Urban Transportation Research. USF, Southeastern Transportation
Center. 2001.
https://www.planning.dot.gov/documents/SecurityPapers/SecurityConsiderations_Polzin.
pdf. Accessed 19 May 2018.

The Guardian. “Hurricane Sandy: High Winds and Flooding Hit US East Coast – Monday 2\9
October” The Guardian. https://www.theguardian.com/world/us-news-
blog/2012/oct/29/hurricane-sandy-new-york-live-blog#top. Accessed 17 May 2018