1. Trans_Log_CI 101204 IIPSEC Integrated Infrastructure Protection System Engineering Center Critical Infrastructure Protection Center SMU Systems Engineering Program 1

2. Trans_Log_CI 101204 IIPSEC Integrated Infrastructure Protection System Engineering Center Critical Infrastructure Protection Center SMU Systems Engineering Program 2 Outline Transportation & Logistics Overview Trans/Log Infrastructure Trans/Log Impact on Economy Modeling Trans/Log CI

3. Trans_Log_CI 101204 IIPSEC Integrated Infrastructure Protection System Engineering Center Critical Infrastructure Protection Center SMU Systems Engineering Program 3 Transportation & Logistics Overview Transportation is one of the most important and increasingly complex infrastructure networks of our modern society George Mason University, Systems Engineering Research and Operations

4. Trans_Log_CI 101204 IIPSEC Integrated Infrastructure Protection System Engineering Center Critical Infrastructure Protection Center SMU Systems Engineering Program 4 Transportation & Logistics Overview –Definitions: Transportation: A facility consisting of the means and equipment necessary for the movement of passengers or goods 1

5. Trans_Log_CI 101204 IIPSEC Integrated Infrastructure Protection System Engineering Center Critical Infrastructure Protection Center SMU Systems Engineering Program 5 Transportation & Logistics Overview –Definitions: Logistics: That part of the supply chain process that plans, implements, and controls the efficient, effective forward and reverse flow and storage of goods, services, and related information between the point of origin and the point of consumption in order to meet customers' requirements 2

6. Trans_Log_CI 101204 IIPSEC Integrated Infrastructure Protection System Engineering Center Critical Infrastructure Protection Center SMU Systems Engineering Program 6 Transportation & Logistics Overview –Trans/Log Impact over History Airports Imperial Rome World War II

7. Trans_Log_CI 101204 IIPSEC Integrated Infrastructure Protection System Engineering Center Critical Infrastructure Protection Center SMU Systems Engineering Program 7 Transportation & Logistics Overview –Logistics in Ancient Times: Rome Imperial Rome governed 50Mil from England to Syria, from Europe to North Africa - 4 major regions What made it possible was the Great Roman Roads You could move legions, materials and messages effectively

8. Trans_Log_CI 101204 IIPSEC Integrated Infrastructure Protection System Engineering Center Critical Infrastructure Protection Center SMU Systems Engineering Program 8 Transportation & Logistics Overview –Evolution of Logistics 3 Demand Forecasting Purchasing Requirements Planning Production Planning Manufacturing Inventory Warehousing Materials Handling Industrial Packaging Finished Goods Inventory Distribution Planning Order Processing Transportation Customer Service Materials Management Physical Distribution Logistics

9. Trans_Log_CI 101204 IIPSEC Integrated Infrastructure Protection System Engineering Center Critical Infrastructure Protection Center SMU Systems Engineering Program 9 Transportation & Logistics Overview –Gross Domestic Product Though total logistics costs rose $26 billion in 2003, reaching $936 billion, those costs are lower as a percentage of total U.S. gross domestic product (GDP). At 8.5% of GDP, logistics costs declined for the third year, shedding 1.6 points since 2000 4

10. Trans_Log_CI 101204 IIPSEC Integrated Infrastructure Protection System Engineering Center Critical Infrastructure Protection Center SMU Systems Engineering Program 10 Transportation & Logistics Overview –Gross Domestic Product: 2003

11. Trans_Log_CI 101204 IIPSEC Integrated Infrastructure Protection System Engineering Center Critical Infrastructure Protection Center SMU Systems Engineering Program 11 Transportation & Logistics Overview –Future Trends Information technologies and the increasing use of GPS have dramatically improved U.S. transportation and logistics efficiency. Annual U.S. logistics costs are about $800 billion. As a percentage of GDP, our logistics expenditures have been cut in half as a result of incorporating these technologies and business methods -- declining to 10.5% of GDP in 1996 from 20% of GDP in 1960. (Source: Volpe White Paper, September 2000) 5

12. Trans_Log_CI 101204 IIPSEC Integrated Infrastructure Protection System Engineering Center Critical Infrastructure Protection Center SMU Systems Engineering Program 12 Trans/Log Infrastructure –Highways –Rail Systems –Air Hubs –Ports –Logistic Arteries Countries States Cities

13. Trans_Log_CI 101204 IIPSEC Integrated Infrastructure Protection System Engineering Center Critical Infrastructure Protection Center SMU Systems Engineering Program 13 Customer Financial Customs Air Freight Fwd Motor Rail Ocean Mfg Information Product/ Material Consolidator De-consolidator Single Source Information

14. Trans_Log_CI 101204 IIPSEC Integrated Infrastructure Protection System Engineering Center Critical Infrastructure Protection Center SMU Systems Engineering Program 14

15. Trans_Log_CI 101204 IIPSEC Integrated Infrastructure Protection System Engineering Center Critical Infrastructure Protection Center SMU Systems Engineering Program 15 Trans/Log Infrastructure

16. Trans_Log_CI 101204 IIPSEC Integrated Infrastructure Protection System Engineering Center Critical Infrastructure Protection Center SMU Systems Engineering Program 16 Trans/Log Infrastructure

17. Trans_Log_CI 101204 IIPSEC Integrated Infrastructure Protection System Engineering Center Critical Infrastructure Protection Center SMU Systems Engineering Program 17 Trans/Log Infrastructure

18. Trans_Log_CI 101204 IIPSEC Integrated Infrastructure Protection System Engineering Center Critical Infrastructure Protection Center SMU Systems Engineering Program 18 Trans/Log Impact on Economy –Cost to serve –Cost of goods

19. Trans_Log_CI 101204 IIPSEC Integrated Infrastructure Protection System Engineering Center Critical Infrastructure Protection Center SMU Systems Engineering Program 19 Modeling Trans/Log CI –Systems Engineering Approach Define the Requirements View the System Validation and Verification –Risk Mitigation Analysis Identify Risk Asses Risk Quantify Risk –Statistical Algorithm Model

20. Trans_Log_CI 101204 IIPSEC Integrated Infrastructure Protection System Engineering Center Critical Infrastructure Protection Center SMU Systems Engineering Program 20 1.Cognitive Science Laboratory, Princeton University 2.The Michigan Roundtables (Council of Logistics Management) 3.Frederick Betz, Managing Technology: Competing Through New Ventures, Innovation, and Corporate Research, 1987, pp. 72-74 4.Perry A. Trunick, How to Beat the High Cost of Shipping, Logistics Today, July, 2004 5.Mortimer Downey, Transforming the Transportation Industry Through the Latest Information Technologies, 7th Annual Conference on U.S.-Japan Cooperation in Transportation Breakthroughs in Logistics, December 5, 2003

21. Trans_Log_CI 101204 IIPSEC Integrated Infrastructure Protection System Engineering Center Critical Infrastructure Protection Center SMU Systems Engineering Program 21 Transportation & Logistics Overview –Gross Domestic Product –In the U.S. and Japan, we can build on the ITS systems we have to create more efficient logistics, including our respective enhanced Global Positioning Systems. In fact, the pervasiveness of the Web and of supply chain management systems has begun to draw upon the capabilities of ITS and Commercial Vehicle Operations technologies in new ways. Supply chain logistics and the Web have been integrated throughout our business sector. Market-driven progress toward integration of the wireless, PC, speech, voice and video into logistics operations has led to enhanced ITS and CVO capabilities. –Information technologies and the increasing use of GPS have dramatically improved U.S. transportation and logistics efficiency. Annual U.S. logistics costs are about $800 billion. As a percentage of GDP, our logistics expenditures have been cut in half as a result of incorporating these technologies and business methods -- declining to 10.5% of GDP in 1996 from 20% of GDP in 1960. (Source: Volpe White Paper, September 2000)

22. Trans_Log_CI 101204 IIPSEC Integrated Infrastructure Protection System Engineering Center Critical Infrastructure Protection Center SMU Systems Engineering Program 22 Transportation & Logistics Overview –Gross Domestic Product –Remarks prepared for –Deputy Secretary of Transportation Mortimer Downey –for Delivery during the –7th Annual Conference on U.S.-Japan Cooperation –in Transportation –Breakthroughs in Logistics: Transforming the Transportation Industry Through the Latest Information Technologies –The Washington Monarch Hotel Ballroom I –Tuesday, December 5, 2000, 3 pm

23. Trans_Log_CI 101204 IIPSEC Integrated Infrastructure Protection System Engineering Center Critical Infrastructure Protection Center SMU Systems Engineering Program 23 Transportation & Logistics Overview –Definition of Transportation and Logistics –Trans/Log Impact over History –Evolution of Logistics –GDP –Current Growth –Future of Trans/Log

24. Trans_Log_CI 101204 IIPSEC Integrated Infrastructure Protection System Engineering Center Critical Infrastructure Protection Center SMU Systems Engineering Program 24 Texas’ Trans/Log Infrastructure –Highways –Rail Systems –Air Hubs –Ports –Logistical Arteries –Cities

25. Trans_Log_CI 101204 IIPSEC Integrated Infrastructure Protection System Engineering Center Critical Infrastructure Protection Center SMU Systems Engineering Program 25 Trans/Log Impact on Economy –Cost to serve –Cost of goods Modeling Trans/Log CI –Systems Engineering Approach Define the Requirements View the System Validation and Verification

26. Trans_Log_CI 101204 IIPSEC Integrated Infrastructure Protection System Engineering Center Critical Infrastructure Protection Center SMU Systems Engineering Program 26 Modeling Trans/Log CI (Continued) –Risk Mitigation Analysis Identify Risk Asses Risk Quantify Risk –Statistical Algorithm Model