Nuclear supply chain fraud: The elephant in the room

The subject of counterfeit, fraudulent and suspect items (CFSI from here on in) is a big topic in the nuclear industry in light of some high profile incidents in the past few years. Civil nuclear plant owners and operators mostly focus on detection to fight this; enhanced levels of inspection, supply chain audits, and repeat inspections are among their weapons.

These additional measures are implemented to prevent CFSI from happening again, and deep investigations and analyses are undertaken to find root causes.

A recent review at a long-time manufacturer of high integrity forgings found, among other items:

• The ISO 9001 and ASME management systems may detract from a comprehensive management system, through focussing on compliance issues rather than a system for the management of regulatory and other aspects related to the production application.
• There is a risk that the cumulative effect of a series of "minor" changes are considered acceptable without requalification, since revisions to qualification documents were not reviewed against original specifications and qualifications.
• The metallurgical aspects of the process are well understood, but it is not clear if they are documented in a way that can be applied by those operating the processes and carrying out tests.

So we have, what looks on the surface, to be all the right certifications, all of the right data and research for our product or project, but have we missed the bigger picture? Have we translated all of our certificates and knowledge into something that is practical, that adds value and addresses the actual issue?

These questions lead us to a missing piece of the conversation, the proverbial elephant in the room when we discuss fraud: CFSI is a cultural issue, plain and simple.

These questions lead us to a missing piece of the conversation, the proverbial elephant in the room when we discuss fraud: CFSI is a cultural issue, plain and simple.

An old management adage goes, "Culture eats strategy for breakfast." In the world of nuclear supply chains, you could say, "Culture eats fraud detection systems for dinner."

This could mean there is a culture of deliberate falsification. A culture of not caring. A culture of concentrating on cost or delivery without considering the wider, unintended consequences. A culture of assumption, or unconscious incompetence.

Bold statements? Yes, and certainly they don't apply broadly across the industry. However, they should provoke thought and reflection, especially as the risk of CFSI increases as nuclear supply chains lengthen, become more diverse, and we move toward using standard items in facilities.

In the case of the manufacturer referenced previously, various recommendations were made to counteract further CFSI, including:

• Comprehensive root cause analysis for all negative audit findings and other non-conformances;
• Identify other, similar non-competitive businesses to share understanding and develop best practices;
• Continue to promote the quality and safety culture.

This last point is key: QUALITY AND SAFETY CULTURE. An effective CFSI policy doesn't just cover detection procedures. It should cover culture, prevention, detection and lessons learned. It also should be adaptive to the changing needs of the facility – through the stages of construction, maintenance and decommissioning.

An effective CFSI policy doesn't just cover detection procedures. It should cover culture, prevention, detection and lessons learned.

Therefore, the prevention of CFSI cannot just be the purview of the supply chain. It must be built into the culture of the project or licensed site operation from the beginning of the project.

A holistic approach that considers the pressures of a new build project, the likely lifetime operation, and even a plant life extension scenario is needed. This approach must consider economics, environmental and social factors.

This culture thing needs to start at the top and the bottom, from the Licensee/Developer to the supplier of the smallest component. A shared Vision, shared Values, People who communicate and share best practises and a common narrative to ensure the common goal is clear and conscious. The tendency to rely on scores and certificates needs to be actively challenged. Move the formal meeting agenda to the side and use the commonly shared culture to drive the conversation, then record the agreements and positive outcomes.

This is not a trifling issue, and certainly a challenge. There are many stories of project cost overruns and delays to schedule, won't this culture idea affect that? Will my costs go up? Consider a recent article in the Sunday Times newspaper from 2018:

"Researchers at Energy Technologies Institute found that most high-cost projects had started construction with incomplete designs, whereas work on low-cost plants had begun only once design and planning had been finalised."

Taking the point that a complete design and clear plan help to produce a cost effective project, then a clearly defined culture which forms an integral part of the project implementation will recognise incomplete, unformed and suspect issues and deal with them.

If we all agree a common vision and shared values, then we will spend less time in meetings trying to agree because we already know where we want to be, together. This will address the culture thing , and we will approach the project in a different way, agreeing the way forward and addressing the finding in the Times article above. The goal is to ensure the right thing at the right time and the right cost, and through this we will have removed CFSI by way of culture.