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An important audit from the U.S Government Accountability Office (GAO), ‘Defense Industry Base – DOD Should Take Actions to Strengthen Its Risk Mitigation Approach’. It is one of many recent GAO reports that articulate the risks posed by the DIB on the manufacture and supply of DoD weapon systems. Highlighting that the DoD is not meeting commitments to manage procurement and supply chains risks as required.
The report highlights the various Executive Orders signed for the DoD to review and manage DIB supply chain risks and security. ‘As of March 2022, Industrial Base Policy officials stated that DOD had not yet issued the implementation plan and schedule for developing an analytical framework for mitigating industrial base risks across the acquisition process’
For the national and international DIB. The report highlights a lack of Strategic Direction and application by the DoD supply chain and procurement risk management. This should be a warning to the DIB giving the current geopolitical crisis and global slow down. As the report highlights risks to U.S domestic manufacturing capacity, sole source suppliers and dependence on foreign manufacturers.
Focusing on cybersecurity, it has been well documented by the GAO in this and other reports that the DIB needs to improve supply chain cybersecurity posture. Highlighted as a significant risk to weapon system and national security, and enforce the implementation of existing DFARS regulations. The mechanisms have been in place since 2017 for this, however the application and oversight needs to be addressed. By way of example there is no mechanism in place for the oversight and assurance of international DIB cybersecurity risk management.
Is this an opportunity for companies to demonstrate they are able to address risks that include cybersecurity. Creating competitive advantage for those companies and countries that demonstrate they can manage cybersecurity risk across their supply chains?
The DoD has all the tools required to develop and deliver an enterprise wide risk methodology for SCRM. FISMA, required by OMB, DoDi 8510.01 and DoDi 5000.90 prescribe the basic foundations that can be expanded across DoD supply chain procurement.
Ted Dziekanowski
#cybersecurity #supplychainriskmanagement #dod #procurement #enterprisewiderisk #theaugustagroup
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