The following posting can also be read and commented upon on the Supply Chain Expert Community web site.
We have provided multiple Supply Chain Matters and Supply Chain Expert Community commentaries as to whether confidentiality and safeguarding of corporate information has generally eroded for personal or individual gain.
Specifically, the issue is whether unscrupulous individuals cannot resist the temptation for personal monetary or other gain from selling certain supply chain information, especially regarding the leaking of information concerning Apple’s value-chain. It seems that any leaked information along Apple’s value-chain which can either place a supplier in a more advantageous position or uncover Apple’s strategies and intents regarding new or existing products, is worth money. Information regarding the number one supply chain and one of the world’s most valuable companies has become extremely valuable, or so it seems. More importantly, the implications to businesses and supply chain teams is far-reaching and not in the best interests of where supply chain business processes need to be.
Late last summer, an ex- global supply manager at Apple was charged with 23 counts of wire fraud, money laundering and unlawful transactions involving a kickback scheme. That individual pleaded guilty earlier this year and admitted to receiving kickbacks from six different Asia based suppliers in exchange for Apple confidential information. In June, a Chinese court sentenced three people, including a former employee of Hon Hai Precision Industry, to prison terms for collaborating to steal information from a supplier to Apple’s iPad2 products in order to get a jump on producing accessory products. The latest visible incident involves an ex-Samsung Electronics manager who leaked information to a Wall Street hedge fund manager in December 2009. Bloomberg BusinessWeek reported last week that during testimony at an insider-trading trial involving an executive at Primary Global Research LLC , this same ex-Samsung employee disclosed confidential shipping information for Apple’s iPad components, potentially causing Samsung to lose a supply contract.
There exist enough visible incidents and probably enough insider knowledge among those in the industry to know that this type of behavior continues. For what personal gain? Is a relatively small amount of extra money worth the ultimate ruin of your professional reputation and your family’s well-being?
The implications of these continued incidents to business costs are also wide ranging. If you believe in any way that confidentiality has become too rigid, or something to take lighly, as the expression goes, “you ain’t seen nothing yet”. Anyone in any role that has visibility to supply volumes will be subject to increased scrutiny and control. Efforts to increase collaboration among suppliers will be stymied by more stringent controls around privacy and security of information. This can lead to harder work for supply chain teams and that would be a shame since so much can be gained from open sharing of important supply and value-chain information and increased business intelligence to product demand trends.
Supply managers will be the most impacted since they are the closest to the information. Doing business with Apple already involves secrecy and strict controls, and these incidents will only make the work of dedicated supply chain professionals even harder to accomplish not only with Apple, but other companies and trading partners as well.
The message to our community is therefore to take note of the importance of confidentiality, since abuse will not, in the end, favor anyone or any organization. We believe that this is a critical issue, and community and broader awareness and commentary needs to continue.
Share your views and let’s start a constructive dialogue on preserving the best aspects of information sharing while respecting the legal confidentiality of certain information.