«F RO M L O G I S T I C S T O S U P P LY C H A I N M A N A G E M E N T: T H E P AT H F O RWA R D I N T H E H U M A N I T A R I A N S E C T O R TA B L ...»
Second, donors are becoming increasingly demanding with respect to performance and impact. With an increasing number of aid agencies, the competition for donor funding is getting more intense, and data demonstrating impact is likely to be the differentiator. Further, donors are becoming less tolerant of obvious and expensive duplication of effort and are strongly encouraging aid agencies to collaborate around the creation of common services. As a consequence, aid agencies have become more aware of the need to strategically use their resources.
Figure 1. Humanitarian Sector Funding Flows8
O ur research over the last four years suggests that certain common challenges face the field of humanitarian logistics.
Lack of Recognition of the Importance of Logistics: Most humanitarian organizations have two broad categories of activities: programs and support services. Programs refers to the front-line activities in relief and development, the provision of services such as food, water, shelter, sanitation, etc. Support services refer to the activities of the “back room”, which support the front line: logistics, technology, finance, communication, human-resources, etc. Funds are usually allocated by donors to programs with a certain percentage allowed for administration, which includes support. Thus, the focus is on shortterm direct relief rather than investment in systems and processes that will reduce expenses or make relief more effective over the long-term. As a consequence, logistics and other support services may not have adequate funding for strategic disaster preparedness, and investing in infrastructure, such as information systems, is discouraged.
A related challenge has to do with the fact that most decisions during a relief operation are made by the program staff who control the budget. The assessment team sent to determine the needs of the population affected by a disaster or humanitarian crisis often does not include a logistician. Based on the assessment, the program staff determine the supplies that need to be procured in order to provide relief services, and then inform logistics that they are responsible for the immediate procurement and transport to the field. Our survey of the largest aid agencies after the Tsunami showed that 42% of the assessment teams did not include a logistician. Since, as seen in the Tsunami response, logisticians are often not consulted in the decision process, some of the logistics bottlenecks are not anticipated and planned for causing unnecessary delays in delivering relief.
Lack of Professional Staff: In general, humanitarian organizations are defined by their personnel, who share a common value system based on alleviating the suffering of those affected by disasters and humanitarian emergencies. People who choose a career in this world come from diverse and varied backgrounds and are driven by a desire to resolve crises and do good in the world. They achieved their positions by trial and error and have honed their valuable skills through experience in multiple disaster theaters over several decades. However, the vast majority of people with logistics responsibilities do not have training in logistics. While this is changing in large multilateral organizations, the trend toward the “professionalization” of logistics has been slow to take hold as field experience is considered much more valuable than formal training in logistics.
Also, as the operations of international humanitarian organizations expand to simultaneously include multiple geographies, organizations are struggling to find people who can manage the complex supply chains of relief. For example, in order to effectively respond to the Tsunami, 88% of large aid agencies surveyed had to pull their most qualified staff from the ongoing humanitarian operations in Darfur.
In conjunction with Erasmus University and APICs, a widely recognized training and certification body for commercial logistics, Fritz Institute conducted a survey of approximately 300 humanitarian logisticians at the field, regional and headquarters levels of major humanitarian organizations. The purpose was to identify existing training and certification programs and the range of logistics functions that they encompassed.
Respondents to the survey (92 respondents) represented a wide variety of organizations including the UN, the Red Cross movement and international and regional NGOs from headquarters as well as the field.
5 Understanding Humanitarian Supply Chains Over 90% of the respondents indicated that they felt training was directly linked to performance on the job and that standardized training would be useful in the field. However, only 73% had access to any logistics training while 27% had no such access. For those with access, training was most often provided by co-workers on the job or by in-house training staff. However, respondents noted that job training within organizations tended to be non-standardized, with the content largely dependent on the trainer. The respondents indicated frustration with lack of consistency in training, lack of ways to measure the effectiveness of training, lack of funding for training, and lack of specific training in humanitarian logistics.
Inadequate Use of Technology: Our survey of logisticians that participated in the Tsunami relief operations showed that only 26% of the respondents had access to any tracking and tracing software.
The remainder used Excel spreadsheets or manual processes for updates and tracking of the goods arriving in the field. Despite this, 58% stated that they received accurate and timely information of what was in the pipeline!
In the private sector, supply chain technology has enabled the transformation of the logistics function from a peripheral to a strategic one. By accumulating data about the supply chain, decision makers have new ways to create efficiencies. Historical data also allows greater effectiveness through the tracking of supplier performance, cycle times, inventory levels and turns, etc. In the humanitarian sector however, logistics and supply chain management is still largely manual. The inability of IT staff at headquarters to understand the imperatives of the field, the primacy of financial managers in decisions about software used in organizations, and the need to keep networks secure are the main reasons that humanitarian logisticians cite as the cause of the slow evolution of IT.
Lack of Institutional Learning: The intensity of relief efforts, high turnover and the crisis-oriented nature of disaster response creates an environment in which there is a lack of institutional learning.
Once a crisis is dealt with, aid workers are immediately assigned to the next mission, rather than taking the time needed to reflect and improve. Or they leave. Input from the organizations we interviewed suggested that turnover of field logistics personnel was as high as 80% annually. Thus, while logisticians have a remarkable track record for getting the job done under the most adverse and extreme circumstances, the lessons learned from one disaster to the next are often lost. The experience of the occasional veteran logistician is largely tacit and difficult to communicate to the next generation, nor is it transferred from one field context to another.
Limited Collaboration: With the emerging competition for funding among major relief organizations, the heads of logistics tend to each fight their own battles with little collaboration. Although many of them face the same challenges and know each other, or of each other, they do not often meet or talk to one another except during an actual disaster response operation. For example, we found that several of them were thinking of deploying a regional warehouse structure for faster response.
Coincidentally, three were actually talking with warehouse providers in the same city. Similarly, two others had commissioned expensive analyses to select a fleet management system and three were wrestling with the idea of a training program for field logisticians. None knew that their counterparts had the same objectives and, therefore, there was little collaboration or resource sharing. Similarly, in the Tsunami relief operations we found that just over half the logisticians (56%) reported working with other agencies in setting up their supply chains.
Understanding Humanitarian Supply Chains 6 T H E PAT H F O RWA R D
T oday's underdeveloped state of logistics in the humanitarian sector is much like corporate logistics was 20 years ago. At that time, corporate logistics suffered from underinvestment, a lack of recognition, and the absence of a fulfilling, professional career path for people performing the logistics function. Over the last 20 years, corporate logistics has found its voice with top management. Under the rubric of supply chain management, it has established itself as a core discipline whose best practices are taught and researched at top business schools and promulgated by leading consulting firms.
In our conversations and convenings we ask logisticians from global, national and regional organizations about their aspirations for themselves and their function. It is not surprising that their most significant priority is a knowledge-based field with a clear career track, collaboration with peers across organizations and the ability to demonstrate the value of logistics with unambiguous measures and metrics that tie with organizational strategy. The way for logistics to strengthen its power and be recognized is by showing results and systemic improvement by clearly demonstrating over time how it is contributing to the aid agency and responding to external pressures.
The Five Strategies This section details five strategies we recommend for moving forward to improve humanitarian logistics. For each strategy we detail ways in which humanitarian logisticians can learn from each other, but also where they can draw upon the increasing interest in humanitarian logistics by academics and the corporate sector. Figure 2 and Table 1 show the relationship between the challenges and the strategies and how each strategy addresses particular pain points. The five strategies each contribute
Creating a professional logistics community will enable humanitarian logisticians to share knowledge and experience on common issues and to create a consistent, powerful voice with all the stakeholders in the sector.
Investing in standardized training and certification will help build a pool of logistics professionals that share common processes and vocabulary, promoting professionalism and collaboration.
Focusing on metrics and performance measurement will empower logisticians to demonstrate and improve the effectiveness of the humanitarian supply chains.
Communicating the strategic importance of logistics will enable logisticians to create awareness of the contribution that logistics makes and to obtain needed funding and resources.
Developing flexible technology solutions will improve responsiveness by creating visibility of the materials pipeline and increasing the effectiveness of people and processes. Furthermore, advanced information systems will create the infrastructure for knowledge management, performance measurement and learning.
The remainder of this section discusses each of the five strategies in more detail.
7 Understanding Humanitarian Supply Chains FIGURE 2. Development of a Path Forward
Creating a Professional Logistics Community Creating a professional logistics community will provide logisticians from different organizations the opportunity to share knowledge and experience. A community of logisticians coming together consistently will also increase the recognition of the function.
The annual Humanitarian Logistics Conference, sponsored by Fritz Institute, has been active for 3 years. Through the conference, high-level logistics managers from over 40 aid agencies have exchanged ideas and fostered initiatives in areas of common interest such as information technology, Understanding Humanitarian Supply Chains 8 performance management, and training. This group has now expressed its desire to expand into a professional association where members will identify priorities for the field and methods to collaboratively address those priorities.
A professional association can act as a clearinghouse for innovations by:
1. Engaging the skills of a network of academics, humanitarian logisticians and private sector professionals with experience in back-room operations
2. Building a repository of accumulated research and knowledge about logistics and supply chain management in the humanitarian sector
3. Creating common standards, guidelines and/or service requirements that can then be communicated with one voice to donors, technology partners, suppliers, and logistics service providers Humanitarian logistics managers must work actively to make the association a useful, vital network. In particular, they must choose initiatives for the association to work on that are critically important.
They must then invest the time and effort needed to support and gain from the initiatives while leveraging the expertise and resources of the group. This will require more frequent, intense communication and coordination among group members. It will also require a continual reflection about how the group can be used to support an individual organization's goals. This is especially true of long-term initiatives, for which the group must spend the time needed to ensure that goals and direction that are established up front are truly in line with the needs of individual organizations.
Corporate logisticians have long participated in multiple communities of practice. The biggest and best known is the Council of Logistics Management (which recently changed its name to the Council of Supply Chain Management Professionals (CSCMP)), which hosts an annual educational conference that is attended by 5,000-7,000 people from a broad range of industries. Other examples of communities of practice include academic roundtables or forums, councils led by particular logistics providers or consulting firms, and industry-specific groups. Based on this experience, corporate logisticians can contribute not only by sharing logistics knowledge and best practices, but also by sharing successful approaches to interacting as a community as well. There may also be opportunities to connect the humanitarian logistics communities with corporate logistics communities such as CSCMP.