Humanitarian logistics

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					6                                                                                                                        FMR 18

    Humanitarian logistics:
    context and challenges
                                                                                                    by Lars Gustavsson

    Logistics and supply chain management underpin                                        sands of aid workers willing to pay
                                                                                          inflated prices, large numbers of the
    responses to humanitarian crises.                                                     local population started to move out
                                                                                          in order to be able to take advantage

               hether there is actual or       the aircraft was on the tarmac at          of the economic gain from renting out
               potential large-scale dis-      Brindisi airport. That afternoon it        their homes. The ripple effect was
               placement, agencies have        landed with 40 tonnes of goods in          that local merchants also raised the
    to get the right assistance to the right   Amman and was cleared and off-             cost of services; costs of supplies in
    place at the right time at the right       loaded within a couple of hours.           the markets rose accordingly, making
    cost. The challenges faced in achiev-      Three transport trucks, 10,000 col-        life very difficult for the local popula-
    ing this are many and complex.             lapsible water containers and              tion that stayed. These are just some
                                               purification tablets, 6,300 blankets       of the logistical challenges confronted
    i. Meeting reconstruction challenges       and 1,800 plastic tarpaulins were          by humanitarian agencies. How suc-
    in Kosovo                                  among the goods landed. By the week-       cessful are they in meeting them?
                                               end – seven days after the initial
    After the end of the war, a massive        phone call – these goods were en           NGOs have been willing to operate in
    reconstruction programme was need-         route to regional destinations in pre-     many places which the corporate sec-
    ed to provide adequate housing for         paredness and readiness for possible       tor may shun. Creating and
    returning refugees and IDPs. In the        influx of refugees from Iraq.              implementing complicated logistics
    immediate post-war period, 100% of                                                    solutions and dealing with ‘the last
    the building materials and tools had       iii. Movement of people from conflict      mile’ – the leg between the final distri-
    to be externally sourced from              zones                                      bution centre and the beneficiary or
    Kosovo’s neighbours. Hundreds of                                                      client – NGOs have been willing to
    trucks had to be mobilised to bring        When conflict erupts, large numbers        invest an inordinate amount of time
    goods to Kosovo and then several           of people often have to be moved out       to make things work. They have con-
    thousand trucks, farm tractors with        of conflict areas to safe zones – to       siderable expertise and experience in
    trailers or other light vehicles were      temporary transit centres, tracing cen-    movement and accountability mecha-
    needed in country to take these goods      tres, IDP camps and refugee camps.         nisms around food aid and effectve
    to final destination points. The roads     Although this is usually the role of       use of gifts-in-kind (GIK) from corpo-
    had not been built for such heavy traf-    the UN, NGOs and other organisations       rate sponsors. Agencies have
    fic; adequate supplies of fuel were not    are often asked to participate.            established or are establishing global
    available; storage and transfer facili-    Logistics is critical for a successful     and/or regional pre-positioning units
    ties had been destroyed or looted;         operation: to locate and mobilise the      capable of delivering critical emer-
    utilities had not yet been repaired;       large vehicles needed, and to ensure       gency supplies, materials, vehicles and
    security was still a concern; and trace    sufficient amounts of fuel, not an easy    technical assistance to any place in
    and tracking systems were often man-       task when fuel is not available in local   the world within a short timeframe.
    ual. Local staff had to be trained in      markets. In addition all the support
    most of the relevant aspects of supply     needs of the transported people            Gaps in NGO capacity
    chain management.                          depend on logistics: food, water, sani-
                                               tation and shelter.                        NGOs can and do play a key role in
    ii. Iraq: speed of delivery                                                           logistics management, particularly at
                                               iv. Influx of humanitarian staff           the field level. Much of this is done
    On a Saturday morning in March                                                        very well. But systems and approaches
    2003, I got a call from our regional       An often under-estimated variable –        are often antiquated. For example,
    management team in Amman request-          and formidable logistics challenge – in    documentation relating to transporta-
    ing an urgent airlift of emergency         large humanitarian crises is the move-     tion is often produced electronically
    supplies, materials and vehicles. I        ment of staff. How do you get large        at point of origin and is often only
    immediately called our head logisti-       numbers of relief workers to the field     available on-line. Unfortunately, even
    cian who proceeded to make calls to        and ensure their safety and shelter        though the commercial world is well
    our logistics staff in Italy, Germany      without distorting the economies? In       advanced in full-electronic handling
    and the US. By Monday morning bids         the Caucasus as in so many other           processes, the majority of
    were being answered. By Tuesday            emergencies, the cost of housing rose      NGOs typically do not have the elec-
    morning the transporter had been           ten fold from pre-emergency local          tronic infrastructure investments in
    selected and mobilised. By Wednesday       costs with the influx of non-local aid     place. Therefore, access to this infor-
    morning all the goods were prepared        workers. The housing supply in Baku        mation is not necessarily possible
    for shipment. By Thursday morning          was limited. With the arrival of thou-     along the whole supply chain and
FMR 18                                                                    Humanitarian logistics: context and challenges         7

often moves quite early on in the han-     ii. Funding biased towards short-          consortia to gain even higher purchas-
dling process from electronic systems      term responses                             ing-power discounts and framework
to paper. This typically means                                                        agreements.
increasing the time required to handle     NGOs tend to be highly dependent
information and process a shipment         upon grants which are generally            Communication systems are not a
and can lead to reduced efficiencies,      geared towards paying for direct pro-      core strength for the humanitarian
duplication of functions, increased        ject and programme inputs in the           community yet are a critical part of
inaccuracies in reporting and              field. Projects and programmes are         humanitarian operations. In crisis sit-
increased costs.                           time-bound, often short and under-         uations, communication with donors,
                                           funded. NGOs live from grant to grant      other parts of the organisation and
In today’s world of modern technolo-       and project to project. This does not      the outside world is vital.
gy, greatly improved approaches to
logistics and supply chain manage-              Millions of dollars could be saved by simply
ment and greater access to know-how
and information, it is critical for             being able to work more ‘smartly’
NGOs to learn from the corporate and
for-profit sector and incorporate          allow for a healthy corporate strategic    Recommendations
emerging best practice. Their ability      process to develop as both planning
to do this, however, has been hin-         cycles and funding cycles are general-     i. Enhance knowledge
dered by a number of factors.              ly unpredictable. And it does not
                                           encourage investment in improved           ■   What the corporate sector learned
i. Lack of depth in knowledge              systems.                                       10 to 15 years ago is where many
                                                                                          NGOs are today. We need to catch
Most humanitarian NGOs are rooted          iii. Lack of investment in technology          up fast and NGOs cannot do this
in emergency response of one form or       and communication                              by themselves. Corporations can
another. Many NGO leaders began                                                           greatly assist humanitarian agen-
their careers with a background in the     Very little capital (from any source)          cies by sharing their know-how,
social sciences, development studies       has been invested in the development           systems and resources. Collabor-
or law. NGO leaders tend to be value-      and implementation of modern man-              ation should ultimately mean
led ‘activists’ and few have corporate     agement information systems (MIS),             more efficient, more cost-effective
experience of logistics management.        information technology (IT) or logis-          logistics operations – to benefit
                                           tics systems. Most NGOs lack modern            those affected by conflict and dis-
Humanitarian logistics involves organ-     ‘systems capacity’ in just about any           aster.
isational components such as               category. Most NGOs have indeed also
procurement, transportation, ware-         greatly undervalued the role of logis-     ■   Logisticians in the field are often
housing, inventory management, trace       tics, supply chain management and              not trained professionals but have
and tracking, bidding and reverse bid-     integrated systems support. This is an         developed their skills on the job.
ding, reporting and accountability. In     area that, if better valued by senior          Competency-based capacity-build-
the corporate sector, these compo-         management, could have a significant           ing initiatives and mechanisms
nents are supported by expert              financial return on investment. Millions       need to be developed and sup-
staffing, know-how, IT systems, MIS        of dollars could be saved each year by         ported so that humanitarian
systems, framework agreements,             simply being able to work more                 logisticians’ skills and know-how
corporate relationships, infrastruc-       ‘smartly’ – more efficiently.                  are raised to more professional
ture, standardisation and collab-                                                         levels, and supported by appro-
orative initiatives. In the humanitarian   For example… Procurement is part of            priate training discipline and
world, these key support mechanisms        the overall logistics process. An NGO          accreditation. New employees
are rare. Much of the essential logis-     with an organisation-wide capacity to          could be sourced from feeder
tics work undertaken by humanitarian       use a common procurement manage-               schools and corporate environ-
agencies is not industry standard and      ment software programme would be               ments where they might have core
NGOs could learn a lot from the cor-       able to see what their top 100 high-           professional skills though needing
porate community.                          frequency or high-cost items were at           to learn more about the humani-
                                           any given time during the year.                tarian context. In addition, there
Furthermore, the humanitarian envi-        Regardless of programme or project             needs to be a greater emphasis on
ronment is becoming increasingly           location, a common software technol-           mentoring and coaching within
complex, requiring a deeper under-         ogy application would enable each              organisations.
standing of conflict, security and         user to function independently, mak-
local, national and international poli-    ing local procurement decisions, while     ■   No single agency can single-
tics. Each year about one in three field   creating and contributing to a global          handedly meet the challenges out-
staff quits because of burnout. As a       purchasing-power mechanism benefit-            lined above. What is required is a
consequence, the NGO community             ting the whole organisation.                   much higher degree of collabora-
and multilateral and international         Management would have the informa-             tion across agencies in the form
organisations such as the UN agencies      tion power to be able to negotiate             of workshops and shared special-
and the Red Cross need to focus            high-volume purchasing agreements              ist pools. It is also important that
much more on capacity building.            with global suppliers, global vendors,         the sector draw on the brain trust
                                           manufacturers or distributors. Better          of the commercial sector, particul-
                                           still, NGOs could group together as            arly in its proven areas of
8   Humanitarian logistics: context and challenges                                                                                        FMR 18

        competence – systems and soft-                 ■   A key area of concern that needs       Denver, US (primary focus serving the
        ware, technical and engineering                    a collaborative contribution by        Americas); Brindisi, Italy (primary
        expertise, etc. Corporations could                 both private sector and NGOs is        focus the Middle East, Central Asia
        provide their own staff with                       that of global communications.         and Africa); Hanover, Germany (a
        opportunities to work alongside                    One idea would be for a consor-        smaller unit serving diverse logistical
        NGOs. The corporate community                      tium of NGOs to work with the          needs). World Vision’s unit is
        could also create a pool of logis-                 private sector, drawing on their       designed to deliver supplies world-
        tics experts available to the                      resources, expertise and knowl-        wide within 72 hours; for more
        humanitarian sector for deploy-                    edge in radio, satellite, licensing    details, contact the author [email
        ment on an on-call/as-needed                       and hardware. One outcome could        below]. IFRC and WFP are each estab-
        basis. Humanitarian demand is                      be a communications unit to serve      lishing four regional pre-positioning
        often ‘seasonal’ with need often                   the wider humanitarian communi-        units [see articles on IFRC and UNJLC].
        dictated by the specific require-                  ty during a large-scale disaster.
                                                                                                  World Vision is working with other
        ments of an emergency. Corporate
                                                                                                  NGOs and Fritz Institute to a) identify
        experts could work alongside                   ■   It is one thing to have logistics
                                                                                                  who is doing what, b) map current
        NGOs in the field in both pre-                     plans, logistics software and logis-
                                                                                                  and future capacity needs and c)
        emergency and during-emergency                     tics staff in place. If communic-
                                                                                                  explore where collaboration is possi-
        phases.                                            ations issues are not also
                                                                                                  ble, where shared investments could
                                                           addressed, however, today’s man-
                                                                                                  be beneficial and what educational
    ii. Broaden the scope of funding                       ual non-integrated style of dealing
                                                                                                  and training provisions are needed.
                                                           with logistics will continue – and
                                                                                                  World Vision International is also
    ■   Donors need to realise that unless                 the logistics chain will remain
                                                                                                  working with donors such as the
        they adopt an actively hands-on                    incomplete and inefficient.
                                                                                                  government of Australia and the
        approach to changing organisa-
                                                                                                  Australian Ministry of Education to
        tional logistics management                    Recent initiatives
                                                                                                  create competence-building and
        funds will often not be used as
                                                                                                  certification initiatives which are
        efficiently as they could be. The              Various articles in this issue highlight
                                                                                                  being shared with affiliates in the Asia
        current donor practice of funding              some recent initiatives, such as UNJLC
                                                                                                  Pacific region; it is planned to expand
        projects and programmes does                   [pp11] and ALITE [pp17].
                                                                                                  this initiative globally by 2005.
        not enable NGOs to tackle this
        problem. Donors need to take                   Other developments include the
                                                                                                  Lars Gustavsson is Director,
        ownership of the problem and                   establishment of a Humanitarian
                                                                                                  Emergency Response and Disaster
        broaden their scope of funding to              Logistics Council2 to heighten the
                                                                                                  Mitigation, World Vision
        include serious investment in                  visibility of the sector and stimulate
        logistics management, IT and MIS               improved logistics management. It
        systems.                                       brings together key logistics managers
                                                       in the humanitarian sector with the        1. World Vision procures GIK based on ‘critical
    ■   Potential for using goods-in-kind              aim of encouraging collaboration,          needs lists’ identified by its international and
                                                                                                  domestic offices. Criteria for procurement include
        is not being exploited. The corpo-             integration, standardisation, synergy      detailed information regarding the donation, its
        rate sector often has excesses in              and joint product development.             value and whether donor will cover freight cost,
                                                                                                  any restrictions (eg specified recipient country)
        inventories, product over-runs
                                                                                                  and requests for publicity.
        and over-supply, often driven by               World Vision has established pre-
                                                                                                  2. Established in 2002 by the Fritz Institute.
        unforeseen market demands or                   positioning units in three places:
        changing fads. These can be put
        to good use by NGOs but NGOs
        need to establish a list of criteria
        that such goods must pass before

    iii. Invest in technology and comm-

    ■   NGOs must come to grips with
        the important role that logistics
        and supply chain management
        can play. Senior managers need to
        recognise that there are great sav-
        ings to be made by consolidating
        and standardising a host of often
        scattered logistics functions.
        Middle management must invest
        time and energy in order to per-
        suade senior leadership.
                                                                                                                                                       World Vision/Stephen Matthews

                    Food distribution in Afghanistan

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