Today’s global economy faces significant challenges resulting from counterfeit items entering the supply chain. This exposes manufacturers and product users to various risks, including components failing to meet quality expectations due to inferior production lines, which has widespread economic, safety and security implications. The Organization for Economic Co-operation and Development (OECD) recently reported that counterfeiting represented $461B of world trade, with more than 500,000 customs seizures. For the DoD, a resilient, redundant and secure supply chain is required to ensure the development and sustainment of capabilities critical to national security, and to ensure the appropriate level of safety is maintained for the warfighter. Counterfeit parts have become a significant threat to the defense supply chain, which affects every component, from off-the-shelf assemblies, to microchips and large military platform assemblies. Eliminating counterfeits would help the DoD reduce risk and cost while significantly improving system performance, yet maintaining the integrity of parts across the supply chain remains a troublesome issue.
In the commercial sector, this issue is widespread also. As a recent example, in 2019, farmers from the Big Island’s Kona district sued more than 20 companies in February 2019 after a lab test reportedly confirmed long-held suspicions that beans being marketed as Kona coffee weren’t actually from the iconic region. The lawsuit claimed that 2.7 million pounds of authentic Kona coffee beans are grown each year and yet more than 20 million pounds of coffee labeled Kona are sold. A total of more than 27 Million dollars was settled in these lawsuits, which outline the severity of the issue.
One approach to reducing the prevalence of counterfeit items is to be able to positively identify the physical characteristics of genuine parts, and then reliably verify the presence of these items through the supply chain. As a result, any item that can not be positively identified and recognised as genuine can be treated as suspicious, and made subject to further investigation. This solution can provide all parties involved with a supply chain with irrevocable proof that the components, parts or products they are dependent on are genuine, and can be relied upon to provide high quality, safe and secure products. Furthermore, the solution can provide proof of ownership of items, and a demonstrable trail of past ownership, to provide items with provenance. To take full advantage of such a solution, participants need to be able to trust the integrity of underlying data used to make assertions about the identity and ownership of an item; that is, to maintain integrity of the digital twin binding for anti-counterfeiting purposes. This data needs to be tamperproof, so that bad actors are unable to inject data about counterfeit parts into the system, passing them off as genuine, or make unauthorized changes to ownership records. Furthermore, the data needs to be traceable, and irrefutably linked to the physical part, removing any doubt about the provenance of the item.
