CTPAT and Transportation Management in the 21st Century

Introduction

Transportation management is one of the most important aspects of a business's operations: the flow of goods and services, the management of the supply chain, logistical decision-making, and security issues all come together under the purview of the transportation manager. In today's world, security is more important than ever, given the threat of global terrorism impacting countries around the world and thus disrupting global supply chains (Sheffi, 2001). As Goldsby (2014) points out, transportation is sometimes "to blame for a company's inability to properly serve customers" (p. 3), and so the concept of the Customs Trade Partnership Against Terrorism (CTPAT) gets right to the heart of the collaborative spirit in the global business industry — ensuring that businesses stand together to address the threat of terror.

CTPAT is a supply-chain security program that is completely voluntary. It focuses on supporting secure supply chains and is led by U.S. Customs and Border Protection (CBP), which provides guidance and logistical support for volunteer participants. After a little over a decade, what started out as a small group of seven large U.S. companies working together to secure their shipping networks and supply chains became an international effort to safeguard business transportation for more than 10,000 companies (Rasero & Piniella, 2015). This paper provides a full analysis of CTPAT from a transportation management perspective, evaluating its effectiveness in helping companies strengthen their transportation systems in the face of the dangerous realities of the 21st century.

Methodology

The method used to obtain information on this subject was a literature review conducted through a keyword search using the terms "CTPAT transportation management." Articles were selected for review based on relevance as indicated by their titles and abstracts; all articles selected contained the relevant keywords and were published within the past five years. The purpose of this method was to obtain information that could provide an overview and understanding of the role that CTPAT plays in transportation management. The following section discusses the sources obtained.

Literature Review

Yang and Hsu (2018) note that because of the rise of terrorism in the 21st century and the need to stabilize transportation modes and channels, "the development of multiple security initiatives to enhance security and resilience capability without affecting efficiency has become an important issue for multinational firms" (p. 220). Their assessment suggests that adding security measures to a transportation manager's agenda can improve resilience in the industry and boost overall performance. Their data were collected through questionnaires distributed to multinational firms relying on transportation management for oversight of shipping and supply chains. Their findings revealed that the more integrated and collaborative the members of the industry are, the more improved the overall interaction and movement of goods becomes.

The findings of Yang and Hsu (2018) correspond and align with Goldsby's (2014) assertion that what happens in one part of the supply chain is bound to impact another part and have ramifications for the broader market as a whole: "When one level in the supply chain experiences delays and problems, it impacts the abilities of downstream members of the supply chain to serve their customers. For this reason, the larger economy is affected when transportation disruptions occur" (p. 5). Transportation managers thus play a very critical role in the maintenance and efficiency of the overall economy simply by conducting safe and secure practices with respect to the shipping of products. As custodians of the global economy, transportation managers can use CTPAT as a way to collectively take responsibility for their own networks and ensure the safe and secure transportation of goods across a multitude of regions.

Springer and Davidson (2015) conducted a review of the benefits of CTPAT and found that the Free and Secure Trade (FAST) program — which CTPAT members are enabled to access — provides transportation managers with a number of advantages, such as "shorter waiting times at the Canada–U.S. border" and increased confidence in the security and integrity of their lines (p. 74). This is an important consideration from a transportation management standpoint because the timely movement of goods is one of the top concerns for a transportation manager, alongside the safety and integrity of the line. CTPAT enables the FAST program to help transportation managers meet both of these goals.

There is also the benefit of using CTPAT as a way of bolstering a company's reputation for corporate social responsibility. The more socially responsible a company demonstrates itself to be, the more likely it is to succeed in the industry, as trust and integrity are characteristics that transportation managers seek when developing relationships with firms in regions where the fast but secure transportation of goods is required. Ramirez, Vélez-Zapata, and Madero (2018) show that CTPAT serves as a "normative pillar with an obligatory dimension" for businesses operating transportation in Central Mexico, where risks of violence and terror are particularly problematic (p. 4). What CTPAT allows these organizations to do is adopt informal security strategies using hired security forces that meet the CTPAT's definition of security and facilitate the movement of trade through the region. The firms and their stakeholders that participate in the international Partnership benefit from a robust sense of corporate responsibility, which in turn facilitates the development of relationships, trust, and integrity throughout the region.

Conclusion

Recommended membership in CTPAT should be a top priority for transportation managers seeking to develop relationships with suppliers and transporters. When selecting a transportation mode or channel, CTPAT certification can now act as the first set of criteria that must be met for the transportation manager to select that company as a partner in the transportation of goods, for both inflows and outflows. CTPAT provides a better assurance of safety throughout a region based on the necessary components that a company must meet in order to become a member. The purpose is to provide stability, efficiency, speed, and integrity to the transportation sector in the 21st century.

The program places the responsibility of ensuring security on the companies themselves and ensures that corporate social responsibility is adopted by those businesses that seek to have a place in the international transportation sector. If they want to work with today's transportation managers, they must abide by the rules of this voluntary partnership.

References

Goldsby, T. (2014). The definitive guide to transportation: Principles, strategies, and decisions for the effective flow of goods and services. Pearson.

Ramirez, J., Vélez-Zapata, C., & Madero, S. (2018). Ambidexterity strategies in illegitimate institutional contexts: The role of informal institutions. Management Research: Journal of the Iberoamerican Academy of Management. https://doi.org/10.1108/MRJIAM-02-2018-0811

Rasero, F. C., & Piniella, F. (2015). Maritime security: Towards a global identification. Journal of Maritime Research, 12(1), 17–24.

Sheffi, Y. (2001). Supply chain management under the threat of international terrorism. The International Journal of Logistics Management, 12(2), 1–11.

Springer, M. C., & Davidson, D. (2015). Research in transportation business & management. Research in Transportation Business & Management, 16, 74–83.

Yang, C. C., & Hsu, W. L. (2018). Evaluating the impact of security management practices on resilience capability in maritime firms — a relational perspective. Transportation Research Part A: Policy and Practice, 110, 220–233.