Stephen Pettit

Anthony Beresford

Cardiff Business School, Cardiff University

2nd International HumLog Workshop, Essen, Sept. 2012

Critical Success Factors in the Supply

of Humanitarian Aid

Introduction

• Aims

• To identify factors critical to the success of

Humanitarian Aid supply chains

• Identify the variables within those factors which

contribute to their effectiveness

• Assess how such factors can assist agencies in

improving strategy and response

Background

• ‘Often the largest and most complex element of relief operations’ (UNDP, 1993)

• Requirement for clear understanding of problems and issues

• Uncertainty difficult to reduce in context of crisis situations

• Understanding factors critical to resolving problems

Background

• Perception of (or actual) failure in HA delivery

systems in some crises e.g.

– Hurricane Katrina

– Indian Ocean Tsunami

• Little development of theoretical understanding

of HA supply chains

• Diverse nature of HA community not fully

understood

Natural Hazards / Disasters

(Earthquakes, Floods etc.)

Migration

(War, Politics,

Oppression etc.)

Managing Change

Law and Policy

(NGOs, Govts,

UN etc)Famine

War / Conflict

Population

(Resouce depletion, sanitation etc.)

Poverty

(Health, Hunger etc.)

Medical

Humanitarian Aid /

Emergency Relief

Facets of Humanitarian Aid

/ Emergency Relief

Connections?

Logistics?

Background

• Crisis response is short term, establishment of

supply chains takes place under high stress

conditions

• ‘We know best’? – consideration of alternative

approaches?

• Research poorly funded or not funded at all

Background

• Many HA logistics processes are similar to

commercial logistics

• However, transfer of business logistics at least

problematical and often not directly transferable

• Existing models are also not directly transferable

• Patterns of movement are similar, but transport

mix often different

Background

• Major differences:

– Funding

– Employment

– Location

– Instability

– Lack of logistics knowledge

• Other problems

– lack of technical knowledge in HA organisations

– insufficient experienced logisticians

CSFs in HA Logistics

• Identification of the key factors which influence

success of HA supply chain

• CSFs conceptualised in 1961 (Daniel)

• Other work on CSFs

– Rockart (1979)

– Porter (1985)

– Huotari and Wilson (2001)

– Gunasekaran (2003)

• Work on related KPIs e.g. Whittaker et al (2005)

CSFs in HA Logistics

• Key CSFs (from literature) – Strategic Planning

– Inventory Management

– Transport Planning

– Capacity Planning

– Information Management

– Human Resource Management

– Continuous Improvement

– Collaboration

– Technology Utilisation

Strategic Planning

• Long term decision making required – Corporate strategy

– Transportation and warehousing

– Location of distribution centres

– Outsourcing of non-core activities

– Budgets

– Capital acquisition

– Resource deployment

– Effective use of skills

Strategic Planning

• Identifies organisational assets

• Assess strengths and weaknesses of scenarios

• Long term approach allows organisation to prepare for crises

• Lack of planning can impinge on a variety of CSFs

• Improves inventory management e.g. pre-positioning (Mt Merapi volcano)

• Use of IT systems

• Sourcing and purchasing of aid

Source: Developed

from Haas, 1977

Inventory Management

• Core logistics function

• Must address:

– Existing inventory

– In-country supplies accessible at short notice

• Must consider lead times for supply of critical items

• Flexibility of process and product prerequisite for responsiveness to changing situation

• Time values of commodities greater than inventory carrying costs

Transport Planning

• Critical to disaster relief

• Mode, utilisation of capacity, scheduling, maintenance

• Concerned with the range of transport activities

• Cross over between existing programmes and short term emergencies

• Competition for same transport capacity in emergency situations increases costs

• Mix of public, private, military capability

Capacity Planning

• Impacted on by short and long term demand

• Implications for: – Numbers of warehouses and distribution centres

– Vehicles

– Equipment

– Employees

• Capacity can be increased by collaboration with other organisations

• Other transport and logistics infrastructure may also affect capacity: – ports, airports

Information Management

• Information management now an important aspect of HA logistics

• Integrate activity, provide information

• Track and Trace, Network management

• Variety of systems have been developed: – UN International Emergency Network (UNIENET)

– IFP International Food Aid Information System (INTERFAIS)

– Fritz Institute Supply Chain Management Software

Human Resource Management

• HRM must pull together disparate functions effectively

• Trained logisticians are important – Often poor at local level

– Best at international level

• Lack of staff can jeopardise response

• Flexible staff policies often only recruit or move staff once a crisis occurs

Continuous Improvement

• Continuous improvement approach is absolute necessity

• Management can use a range of tools to monitor and compare performance: – tracking key factors in supply chain performance

– Benchmarking

– KPIs

– IT performance measurement

• Performance review vital

Collaboration

• Collaboration important for achieving integration and efficiency

• Close supplier relations

• Collaborative bidding to lower purchase costs

• Collaboration wit commercial organisations to improve distribution networks – WFP, American Red Cross

• Outcomes are usually positive

Collaboration

• Often only occurs once a crisis underway – More difficult to optimise collaboration

• ‘lacking any standard operating procedures or common understanding of the roles each would play, on-site coordination and management among the humanitarian organisations was not optimised. Competing supply chains for procurement and transportation caused congestion at local airports and roads, taxing already limited capacity’. (Fritz Institute, 2005)

Collaboration

• Ad hoc collaboration may be useful in short term but in longer term less useful

• Pre-crisis resolution more effective

• Lack of effective collaboration can impact on other CSFs: – Inventory management, capacity planning, transport

Technology Utilisation

• Existing technology is not necessarily redundant

• Utilisation of existing infrastructures important

• Real time communication most effective method: – Asian Tsunami initially largely cellular and satellite

phones

– 1 week before 50% organisations on e-mail

• Over-reliance on one type could lead to problems

Conclusions

• CSFs equally relevant to HA logistics as commercial logistics

• Some CSFs central to effective HA response

• More sophisticated planning may yield better control

• Next stage of research is to: – Clarify which CSFs are important

– Assess priority rankings

– Compare commercial KPIs with emergency CSFs

Thank you