Supply And Demand INSIDE A Humanitarian Supply String Commerce Essay

As majority of Supply String research is focussed on controlling and optimising the commercial way to obtain goods and services, Humanitarian Resource String has received less attention. However, in the current global scenario, credited to increasing populace and producing infrastructure, more emphasis has been given on the unpredictable emergencies (like earthquake, floods and so forth) wherein an incredible number of lives will be at stake and would depend on the sufficient and timely supply of food and other resources. In Humanitarian Resource Chain, due to its uniqueness, more emphasis should be given on demand uncertainties and handling and optimising materials circulation to be delivered to the right people, at right time also to the desired location.

As Humanitarian Source Chain functions on objective critical tasks, time is the critical factor than cost and should be given sufficient importance. Supplies consist of relief items, staff/ volunteers, travel and building resources yet others. Major factor in the source aspect is the improper timing and amounts to be shipped and arrived. There are many critical issues encountered in the storage space and transport of relief items anticipated to incorrect delivery and appearance and also due to lack of execution of appropriate SC strategy (Press and Move which would be explained later). There were many cases in the past including major disasters like Tsunami, wherein problems were encountered in transparency in the Supply Chain (lack of Corporate Sociable Responsibility/ CSR), traffic monitoring and tracing of equipment (right amounts including financial and other resources to be sent to the required location).

Customers in a Humanitarian (Devastation) Supply String include the inhabitants at the afflicted area and also intermediate customers in the neighborhood or global storage area facilities and depend on the kind of disasters and the timeline. Disaster demand forecasting would also be difficult due to the lack of historical data no matter maintenance of databases by both NGOs and governments and would sometimes be insufficient due to inappropriate/ inconsistent data collection and confirming problems. Disasters are in essence unique regardless of locations and depend on the population framework, economic conditions and so forth.

Coordination and management of Disaster Supply String has challenging problems. The source network is large and consists of many players like Donors, NGOs, Federal, Army and Suppliers and it is very hard to coordinate all the items amidst all the players. Despite the different cultural, political, geographical and historical variations among them, collaboration and specialty area of the duties between NGOs, armed service, government and private business are significantly needed in the humanitarian source chains (Truck Wassenhove, 2006). Despite having good knowing of tips in the Humanitarian Supply Chain, Logisticians in most NGOs or other Humanitarian Organisations wouldn't normally be specialised in using the tools and approaches for solving the issues that would appear during the functions. Also, goals and performance metrics of Humanitarian and regular Source Chains do change considerably.

Table 1. 1 Variances between Commercial and Humanitarian Source Chain

Commercial Resource Chain

Humanitarian Relief Chain

Demand Pattern

Demand routine is relatively steady and predictable and occurs from predetermined locations and in place quantities.

Demand is highly uncertain and unstable in terms of location, timing, type and size. Demand requirements are believed predicated on the evaluation of disaster characteristics.

Lead Time

Lead time would be determined by the Supplier-Manufacturer-DC-Retailer chain.

Zero (approx) lead time requirements (between the occurrence of the demand and the necessity for the demand) and the actual business lead time would be still dependant on the chain of material move.

Distribution Network Configuration

Number and locations of Distribution Centres (DC) are systematically defined.

Challenging and unstable due to the nature of unknowns (location, timing, type and size).

Inventory Control

Inventory levels are determined based on well-defined methods on demand, lead time and focus on customer support levels.

Inventory control is very much indeed challenging scheduled to high variations in the business lead time, demand and the positioning.

Information System

Well-defined with advanced technology.

Information is highly challenging, unreliable, insufficient and inconsistent.

Strategic Tools

High quality product or service at low priced to maximise profit percentage and increase client satisfaction.

Minimise loss of life and ease fighting [Thomas (2003)].

Performance Dimension System

Focussed on reference performance procedures such as maximising profit margin or minimising the cost.

Primary target would be on the result performance measures including the time required to respond to a tragedy or the ability to meet or go over the needs of the devastation (client satisfaction).

Perception of demand

Products

Supplies and People

1. 2 Relief Mission Life Pattern

Figure 1. 1 Pain relief Mission Life Cycle [revised from Thomas (2002)]

There are quite simply four distinct stages for the life span cycle of your relief mission.

1) Examination: Predicated on the devastation characteristics, nominal resources are required to identify the necessity.

2) Deployment: Ramping up of source requirements to meet a desired need.

3) Sustainment: Functions are sustained for a certain time frame.

4) Reconfiguration: Functions are reduced, and then terminated.

The above life routine will be experienced by all the Humanitarian Organisations responding to a disaster. After the reconfiguration cycle of the relief mission, there would be occurrence of another deployment cycle related to the development work.

2. 0 Stakeholders in a Humanitarian Pain relief Supply String:

The following are set of Stakeholders in a typical Humanitarian (Devastation) Supply Chain

Government

Non Governmental Organisations (NGO)/ Humanitarian Organisations

Suppliers

Donors

Military

Media

Beneficiaries

In an average Humanitarian Supply String, Authorities and NGOs are the Primary Stakeholders mixed up in operation. Governments keep the main power with the immediate control over politics and economic policies which would affect the movement of Relief Supply Chain. Following the 2004 tsunami, for illustration, the Indian federal government did not request international aid firms to participate by any means in the first 60 days of the relief effort, and functioned throughout that period with the local sources of equipment (Thomas and Fritz, 2006). Donors, Military and the Multimedia will be the other significant Stakeholders in the Relief Supply String.

3. 0 Identification of Specific Humanitarian Pain relief Supply Chain:

The chosen Humanitarian Source Chain activity is on the Tsunami catastrophe which took place on 26th of Dec 2004 influencing Indonesia, Sri Lanka and South India. Tsunami was a huge disaster which afflicted whole lot of lives, infrastructure and altered the economic a higher level the united states. Tsunami did placed difficult for the Humanitarian Logisticians to react to the most uncertain alleviation businesses and forecast the uncertain demand with the real time data.

4. 0 Id of difficulties at Macro, Meso and Micro level for the Tsunami catastrophe Supply String:

Micro
1) Lack of trained logisticians within Humanitarian Company
2) Ad-hoc inside operations (Supply Chain process)
Meso
1) Limited collaboration and coordination

2) Contracting agreements

Macro

1) Procedures and political pressure

2) Economic instability

3) Traditions and operating methods

5. 0 Tsunami disaster Supply Chain Comfort process:

Figure 5. 1 Alleviation Supply Chain (Thomas, 2004) changed by Mizushima

5. 1 Evaluation of issues in the Tsunami Alleviation Chain process:

According to the study conducted by the Fritz Institute, lot of international Organisations performed encounter issues with regards to humanitarian logistics after the Tsunami disaster. The following are the elements of the Tsunami Comfort String process and shows the issues worried about them.

1) Preparedness

This step shows the potency of the plan of action prepared by the Organisations for the catastrophe relief. Based on the survey, original strategies developed by the Organisations for the Tsunami devastation relief weren't accurate enough to check out the established operations and move proficiently to the next steps of assessment, appeal and reference mobilisation. According to the survey, almost all of the Organisations involved with the Tsunami pain relief decided on the communication procedures among the root causes of inaccurate original course of action.

2) Assessment and Appeal

During Tsunami devastation, the majority of the Organisations did not have accurate information on the number of beneficiaries, locations and other programs due to the lack of availability of clear ground information. Lack of trained local personnel and devastation of infrastructure limiting usage of impacted areas made many Organisations struggling to leverage knowledge from other Organisations and compensate these issues in obtaining better information.

Another major concern was the data of the analysis staff performing the examination of the information on the tsunami influenced regions. As most of the assessment associates were international, the lack of associates with local knowledge and skilled logisticians made them difficult to gather useful information.

3) Source of information Mobilisation

Analysis of source mobilisation was predicated on three categories: Financial Resources, RECRUITING and Organisational SETUP.

Financial Resources

The level of destruction induced by Tsunami created a fantastic response from People and Organisations throughout the world. However many Organisations do mention that financial resources were inadequate during the time of the disaster.

Human Resources

When analysing the mobilisation of RECRUITING, the survey did examine the product quality, quantity and training level of the personnel at the regional, nationwide and international level. Predicated on the study, it was evaluated that international staff members were rated to have significantly more expertise; nonetheless they were not able to cope with the knowledge of local affected regions.

Also, there have been some contracting issues through the relief operation. Many Organisations did implement momentary contracting technique for 1-3 months and there have been only small ratio of Contractor contracts which lasted for more than six months and these strategies performed arise a whole lot of issues related to mobilisation of Human Resources to different influenced regions.

Organisational SETUP
4) Procurement

Although many Humanitarian Organisations had pre-established procurement functions, over half of them does experience procurement delays during Tsunami disaster relief. Many Organisations performed chase for same items and with same amounts causing shortages and even more delays leading to the incorrect execution of the proposed procurement plan.

Many Organisations possessed pre-established framework agreements with the suppliers for foods, medical items and vehicle with second option indicating higher ratio. Only small ratio were assigned to food items anticipated to which many Organisations does face many problems like lack of food materials to be sent to the required location.

Also, prioritising solicited from unsolicited donations performed impact on the Tsunami comfort string. However only some Humanitarian Organisations possessed established procedure for prioritising these donations before these were allowed to reach the influenced destinations. Finally, insufficient Corporate Sociable Responsibility (CSR) with many Organisations does cause many unethical techniques with incorrect procurement strategy in place and impacting the comfort process.

5) Vehicles Execution

Destruction of infrastructure such as highways and airfields and also traditions delays have cite many inconveniences to travelling execution. Many Humanitarian Organisations have come across problems in evaluating the damaged locations especially in Indonesia and Sri Lanka which created a lot of congestion for many Organisations for the limited transportation capacity through helicopters or on few working highways.

Secondly, there have been many delays in the vehicles of particular items like medical supplies scheduled to hectic traditions methods at the airport. Also, insufficient communication of the changes in procedures including traditions and other requirements and shear level of goods performed cause bottleneck to numerous Organisations.

6) Traffic monitoring and Tracing

According to the review, many Humanitarian Organisations performed use ad-hoc solutions like Excel spreadsheet and manual efficiency to update the process of keep track of and trace and only 26% of these used software based mostly technology to handle track and track process for procured products. For this reason, many Organisations do face bottleneck situation in acquiring the regular updates on critical information over the Supply Chain

7) Stock Advantage Management

Most of the respondents mentioned that they had warehousing and inventory management systems and procedures in place and 85% mentioned they achieved the needs of the procedure. While these systems fulfilled their needs, the organizations deployed them in new locations. 71% reported that they didn't use already existing local logistics set-ups, thus obliging those to create novel local structures because of this response.

Not all inventories were placed into place following the Tsunami struck. Recent initiatives have been made to strategically pre-position stock. By looking at the average person reactions in the table below, pre-positioning occurs mainly at the international level with only moderate success. At the local level and below, pre-positioning is not common so when used not able to meet needs. Future work could determine why the pre-positioning didn't perform better.

8) Expanded Point of Delivery/ Distribution (POD) and Relief to Beneficiaries

An long delivery point/ POD is an inland destination close to damaged areas wherein goods can be staged before letting them to beneficiaries. During Tsunami comfort operation, many Organisations faced lot of issues with limited POD's and damaged other operations in the comfort chain.

Monitoring, Analysis and Reporting

Monitoring and analysis create the info bottom for decision making during the implementation of alleviation chain. Lack of logistics trained employees, counting on ad-hoc manual monitoring, evaluation and reporting process than Information Technology (IT) systems caused many Humanitarian Organisations difficult to measure their pain relief chain's budget performance, velocity performance, efficiency, and quality up against the targeted final result (Forecast).

Communication, Cooperation and Coordination

Basically, cooperation was done predicated on ad-hoc, "immediate needs" basis. Many Humanitarian Organisations have struggle to deal with their internal functions and desire to utilize other agencies is at vein. Insufficient operating types of procedures, inappropriateness in the relief chain process and lack of optimisation of on-site coordination and management does make these Organisations face the bottleneck situation through the Tsunami comfort.

5. 2 Logistics Flows

Figure 5. 2. a Product Flows

Figure 5. 2. b Information Flows

Figure 5. 2. c Financial/ Cash Flows

Figures illustrate the three types of moves along the Pain relief Supply Chain.

Physical logistics moves occur between the following operations: Resource mobilisation, procurement, transportation, stock advantage management and long point of delivery.

Information flows hook up the following comfort chain processes: Preparedness; diagnosis and appeal; keep tabs on and track; monitoring, evaluation and reporting; and communications.

Financial/ Cash moves take place through the subsequent procedures: Preparedness; analysis and appeal; procurement; and monitoring, evaluation and reporting.

6. 0 Modelling, Simulation and Optimisation of Tsunami Relief Chain Process:

Modelling and Simulation approaches for the Humanitarian Supply Chain are very good not the same as Commercial Supply Chain. Unlike Commercial Supply Chain, Humanitarian Source Chain elements such as inventory management, syndication network modelling and vehicles planning requires meaningful analytical models for devastation response which can be developed only with the close knowledge of the federal government and NGOs.

Forecast modelling

One of the analyzed simulation models for the purpose of forecasting the Tsunami is the technique of Splitting Tsunami (MOST) developed by Titov of PMEL and Synolakis of College or university of Southern California is the existing standard model used at the Country wide Oceanic and Atmospheric Supervision (NOAA) Centre for Tsunami Research [NCTR]. This model is capable of simulating three techniques of Tsunami advancement: earthquake, transoceanic propagation and inundation of dried land.

The main goal of any forecast model is to offer an estimate of influx arrival time, wave elevation and inundation area immediately after a Tsunami event. Tsunami forecast models are run on the option of real time data under uncertain situations.

Tracking and tracing of supplies

Relief Logisticians must procure and observe supplies from charm to delivery level of the supply chain making sure all the relevant financial information and movements of goods along the relief pipeline. Despite their role in providing relief to beneficiaries, logisticians are seldom incorporated in the purchase and development of it solutions associated with relief businesses (Lee & Zbinden, 2003).

To incorporate all the functions over the relief chain also to advance the info technology, Fritz Institute combined with the International Federation of the Red Combination (IFRC) is rolling out Humanitarian Logistics Software (HLS) in order to handle many deficiencies within the current logistics systems. Based on the analysis performed on the logistics systems used leading NGOs, the next IT software's could be built-into the Humanitarian Source Chain in order to achieve the best derive from appeal to delivery level of the pain relief chain.

SUMA (Humanitarian Supply Management System)/ PAHO

Microsoft- FACTS (Save the Children/ Mercy Corps)

Commodity Monitoring Systems CTS2000 (World Vision)

CTS (Save the Children)

Purchase Plus PALMAS (Oxfam/ IRC)

Log 6. 5 (Medecins Sans FrontiЁres)

Disaster Preparedness and Response Modelling
Disaster preparedness and response modelling involves four areas

1) Supply Chain model

2) Point of Circulation (POD) model

3) Demand model

4) Disaster model

These four elements constitute the simulation construction produced by IBM called i-DRuM (IBM's Disaster Response simulation Model). This model can be customised to any type and size of catastrophe responses.

The Supply String Model details the stream of relief materials from Humanitarian Organisations to Syndication Centres (DCs), to local governments and lastly to the Tips of Syndication (POD). The POD distribution model identifies about the syndication of relief materials to subjects who collect at POD to get items. The demand model identifies the incident of disaster subjects needing relief supplies regarding time and location. Finally, the catastrophe model explains the appearance and progression of disasters regarding time and location.

The catastrophe model impacts and influences the number of subjects (the demand model), activation of supply chain nodes and travelling (the supply chain model) and the efficiency of POD businesses (POD distribution model). Each one of these models donate to the impact of disasters and constitute the entire effectiveness of devastation preparedness and response plans and operations.

The disaster response modelling framework involves two parts

1) Simulation

2) Optimisation

Simulation model is developed to comprehend the unfavorable impact of disasters, disaster response functions and the results of the choice plans of preparedness and response.

Analytic models are developed to optimise the relief supply string and distribution procedures.

Development of Analytic Models for Transporting Pain relief Materials to POD
In most devastation cases (including Tsunami), catastrophe relief materials would reach different PODs at different speed and with varying quantities. In order to reduce the imbalance between the demand and supply and increase the effectiveness of distribution, two analytical models have been developed

1) Optimal Dispatching Model

This model represents the best vacation spot POD for every shipment from the neighborhood region.

2) Optimal Cross delivery (Levelling) Model

This model determines the most effective cross levelling shipments (time of dispatch, origination POD, and destination PODs and cross levelling number) by considering forecast of expected victims in each POD, on-hand inventory, in-transit inventory to PODs, availability and capacity of cross shipping trucks, transit time, lowest shipment size for combination shipping and consistency of combination levelling etc. This model is very effective when the neighborhood area is located a long way away from POD vacation spot.

Role of RFID in Humanitarian Supply Chain

Radio Frequency Identification (RFID) tags and visitors plays an important role in checking the disaster pain relief supplies directed from Humanitarian Organisations to Distribution Centres (DCs), to local governments and finally to the Details of Syndication (POD). It can help in optimising the procedure of effective management of stock property.

Hence with the implementation of appropriate simulation models and IT systems to the Tsunami disaster relief procedure, optimisation of comfort supply string response would be very effective.

7. 0 Drive and Move Strategy in a Humanitarian Supply Chain:

In a commercial drive supply chain, development and distribution decisions are created on long-term forecasts and the manufacturer uses purchases received from the sellers' warehouses to forecast the demand.

In a pull strategy, true customer demand drives the production and distribution rather than forecasts.

In the context of Humanitarian Source String, with uncertain demand situations, it is difficult to forecast demand on a long term basis based on historical data and would lead imbalance between your demand and supply.

With the take strategy in place, demand forecast would be predicated on real time data and there would be decrease in the inventory costs, upsurge in service levels and reduced bull whip impact. However, as time is a crucial factor in a Humanitarian Resource Chain, take strategy reduces when lead time becomes too much time to react to the unstable demand.

These inherent strengths and weaknesses of the two strategies have resulted in the proposal new Cross Push-Pull strategy that requires advantage of the best of every while conquering their respective disadvantages. In this Humanitarian Supply String, the initial periods would follow the Force strategy while the remaining periods would follow the Move strategy. The program between your two stages is generally called Push-Pull boundary. Implementation of hybrid strategy would optimise the inventory management and the supply chain response over the pipeline of the alleviation supply string.

Alongside this plan, decentralisation, pre-positioning and pooling of alleviation items are key success factors for dramatic improvements in Humanitarian businesses performance in devastation response and recovery.

8. 0 Commercial Sociable Responsibility (CSR) in a Humanitarian Resource Chain:

CSR is approximately capturing the complete set of beliefs, issues and techniques that companies must treat in order to reduce any harm resulting from their activities also to create economical (profit), communal (people), and environmental (globe) value.

CSR is vital as it is directly linked with micro, meso and macro factors and provides tangible and intangible value to the Company. In addition, it offers ecological competitive advantage to all or any the stakeholders. As more unethical tactics happen in the humanitarian resource chain in comparison to commercial supply chain, strict compliance with the restrictions is required by all the players. With the correct execution of appropriate strategy and simulation models along the pipeline of relief chain process, Commercial Public Responsibility (CSR) would be optimised effectively.

9. 0 Summary:

Many Humanitarian Organisations realised the importance of logistics that enjoyed during the outcome of Tsunami. Humanitarian Organisations also realised the value of utilising involved technology systems to fully capture and analyse information resulting in a far better and efficient comfort work. Also, the examination of Tsunami Alleviation Chain process shows that the issues faced by Humanitarian Organisations are primarily common and not affected by Organisational size. The research also pointed out that relief work need more attention on the next areas: Assessment, collaboration, human resources and supply chain evaluation. The analysis of this case study also mentions about the implementation of strategies and simulation software in order to optimise the Alleviation Supply String response and also to integrate, coordinate, collaborate and speak between all the functions of the pain relief chain.

10. 0 Suggestions:

Based on the IT simulation software talked about and used by many Organisations including NGOs in the Commercial Supply String market could be well used in the Humanitarian Supply Chain as well. Humanitarian Logistics Software (HLS) needs trained logisticians which is too costly to put into practice at an early on stage. However the complete benefit can be obtained once it is extensively implemented and integrates all the functions across the pipeline of the Alleviation Supply Chain. Subsequently, implementation of Crossbreed Push-Pull Supply String strategy would profit monitoring and tracing, inventory management and syndication of pain relief items.

11. 0 Glossary:

SC- Resource Chain

CSR- Corporate Friendly Responsibility

NGO- Non-Governmental Organisation

DC- Distribution Centre

POD- Point of Distribution

MOST- Method of Splitting Tsunami

NOAA- Country wide Oceanic and Atmospheric Administration

NCTR- N (NOAA) Centre for Tsunami Research

IFRC- International Federation of the Red Cross

HLS- Humanitarian Logistics Software

SUMA- Humanitarian Source Management System

PAHO- Pan American Health Organisation

CTS- Commodity Tracking System

i-DRuM- IBM's Catastrophe Response simulation Model

IT- Information Technology

RFID- Radio Frequency Identification

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