Performance Measurement in Humanitarian Logistics

Transcription

1 Proceedings Klumpp, Mathias Abidi, Hella (Hrsg.) 2. International HumLogWorkshop Essen 24. September 2012 Performance Measurement in Humanitarian Logistics

2 2013 by MA Akademie Verlagsund Druck-Gesellschaft mbh Leimkugelstraße 6, Essen Tel Fax Das Werk einschließlich seiner Teile ist urheberrechtlich geschützt. Jede Verwertung außerhalb der engen Grenzen des Urhebergesetzes ist ohne Zustimmung der MA Akademie Verlags- und Druck- Gesellschaft mbh unzulässig und strafbar. Das gilt insbesondere für Vervielfältigungen, Übersetzungen, Mikroverfilmungen und die Einspeicherung und Verarbeitung in elektronischen Systemen. Die Wiedergabe von Gebrauchsnamen, Handelsnamen, Warenbezeichnungen usw. in diesem Werk berechtigt auch ohne besondere Kennzeichnung nicht zu der Annahme, dass solche Namen im Sinne der Warenzeichen- und Markenschutz-Gesetzgebung als frei zu betrachten wären und daher von jedermann benutzt werden dürfen. Oft handelt es sich um gesetzlich geschützte eingetragene Warenzeichen, auch wenn sie nicht als solche gekennzeichnet sind.

3 2nd International HumLogWorkshop Performance Measurement in Humanitarian Logistics Forschungsförderung (WiWeLo Projekt) durch: Förderkennzeichen: 01 C10L19D

4 2nd International HumLogWorkshop Performance Measurement in Humanitarian Logistics President s Introduction For the second time our distinguished research institute ild organized an international workshop on humanitarian logistics, this time with the specific topic of performance measurement in humanitarian logistics. This is a very promising research field and our university is glad to support this annual international meeting by experts from science, business and humanitarian practice. Presenters of the 2nd International Workshop on Humanitarian Logistics (l.t.r): Prof. Maria Besiou, Isabelle de Muyser-Boucher, Prof. Anthony Beresford, Melissa Robles, Richard van Dijk, Prof. Dorit Bölsche, Katrin Mohr, Dr. Stephen Pettit, Ira Harrvisto, Prof. Matthias Klumpp The workshop was initiated 2011 by Ms. Hella Abidi and Prof. Dr. Matthias Klumpp and is now growing into an established meeting point for international humanitarian logistics research. We are very proud of this development and will provide further support for this outstanding example of beneficial applied science for our societies in the world. Prof. Dr. Burghard Hermeier President FOM Prof. Dr. Thomas Heupel Vice-President Research FOM 2

5 2nd International HumLogWorkshop Performance Measurement in Humanitarian Logistics Editors Preface The Institute for Logistics and Service Management (FOM ild) at FOM University of Applied Sciences in Essen has organized the 2 nd International HumLogWorkshop Performance Measurement in Humanitarian Logistics on the 24 th of September 2012 in Essen, Germany. We have met different expert logistics providers (DHL, Meyer), national and international government organizations such as UN and UNICEF, private humanitarian organization (North Star Alliance) as well as international research institutes and universities like INSEAD/KLU, VU Amsterdam, Cardiff Business School, University Duisburg- Essen, University Münster, University of Applied Sciences HS Fulda and Hanken HumLog Institute Finland. All of them are important and experienced in the sector of humanitarian logistics. In our workshop they have joined us with discussions and also their experience regarding current and important subjects in humanitarian logistics in order to improve and promote the performance of long-term and short-term processes, performance measurement systems, performance measurement indicators and gaps in the area of humanitarian logistics. Finally we all hope for these contributions as well as this workshop documentation to enhance operational performance in all humanitarian and relief operations and therefore alleviate the suffering of people in need. We are also looking forward to the next 3 rd International Workshop to take place on the 23 rd of September 2013 in Essen. Prof. Dr. Matthias Klumpp Research Director ild Hella Abidi Research Assistant ild 3

6 List of content List of content 1 Introduction Thomas Heupel 4 2 Humanitarian Logistics Performance through Education Matthias Klumpp, Hella Abidi 6 3 Performance measurement and reportingin the corporate responsibility report perspectives of auditors vs. practitioners Kathrin Mohr 17 4 Tracking of In-Kind Contributions LogIK Isabelle de Muyser-Boucher 29 5 The Effect of Earmarked Funding on Fleet Management for Relief and Development Maria Besiou 36 6 Performance Measurement in Cross-Border Settings Richard van Dijk 45 7 Planning and optimizing relief systems in humanitarian logistics Abbas Al-Rafaie, Bernd Noche, Melissa Robles 60 8 Critical Success Factors in the Supply of Humanitarian Aid Stephen Petit, Anthony Beresford 72 9 Agility in Humanitarian Supply Chains David Knight, Stephen Petit, Anthony Beresford Performance measurement in humanitarian logistics Dorit Bölsche Die Veranstalter 118 Appendix: Program 2nd International HumLogWorkshop 120 4

7 Introduction 1 Introduction Thomas Heupel Ladies and Gentlemen, a warm welcome to our second international conference on humanitarian logistics. After about a year ago on October, 10th 2011 we have debated for the first time in this context on developments and trends in the humanitarian logistics at FOM university, as dean of research I am pleased about this event for the second year. That issue is more relevant than ever, the numbers show that since 1970, there are six times more disasters on Earth. More and more people suffer from earthquakes, floods, political unrest or war and must be supplied with foodstuffs urgently, medicine, water and clothing. This is a logistical challenge in extreme conditions. Finally, in many disaster areas, the infrastructure has been destroyed or threatened by other unforeseeable events. I am particularly well this year on the international nature of this event and would like salute you as experts from agencies, universities and logistics companies around the world here in Essen at the FOM. On this international workshop we would discuss as scientists and experts about ways to make humanitarian aid and supplies to disaster areas more efficiently. The schedule for this day is filled top-class and we look forward to great contributions such as this morning on the subject: Success factors in humanitarian aid supply chains ; Agility in humanitarian aid supply chains ; How to measure quality in humanitarian operations? ; Planning and optimizing relief systems in humanitarian logistics. After lunch, it goes further with: Cooperation in procurement among organizations of the UN system at the field level ; Performance measurement in cross-border settings: The case of health services delivery in low-income settings ; Performance measurement and reporting in the corporate responsibility report - perspectives of auditors vs. practitioners ; Performance measurement in humanitarian logistics and last but not least The Effect of earmarked funding on fleet management for relief and development. And for the evening, we invite you cordially as the finale to a workshop dinner. 5

8 Humanitarian Logistics Performance through Education 2 Humanitarian Logistics Performance through Education Matthias Klumpp, Hella Abidi The purpose of this research is firstly to provide the humanitarian logistics community with an overall picture about competencies and skills in humanitarian logistics and secondly to maximize the logistics performance. The humanitarian logistics sector deals with a complex and dynamic environment like planning of transport under difficult and challenging conditions such as destroyed or impassable roads and airports as well as congested seaports or supply vulnerable beneficiaries with shelter, water, medicine and food in a short time, the humanitarian logistics staff and different humanitarian organization have a lead time of zero. Due to all these challenges there is a lack of professionalization of the logistics function in humanitarian context from an international perspective. This research elaborates practical approaches how the skills and competencies can be enhanced and developed for international education programs. An empirical survey as approach was used. Hereby a descriptive analysis provides in a comprehensive way education, skills and competencies in humanitarian logistics. The respondents are from different countries and continents as well as from different humanitarian sector e.g. humanitarian organizations; logistics service providers, military services and researchers. In general, the findings of the research paper present valuable insights of mandatory contents of education in humanitarian logistics as well as competencies and skills on different levels based on EQF (European Qualification Framework). On slide 9 the results shows the best five evaluated competencies as well as skills which are needed in the logistics in particular humanitarian logistics. Slide 10 presents the five negative evaluated competencies as well as skills such as having knowledge in legal basic (Average 2.97) creating calculations and offers (average 2.59), leading negotiations (average 2.56), planning, performing and document orders and projects (average 2.50) and finally quality management (average 2.48). These negative evaluated competencies as well as skills has to be enhanced and promoted because the humanitarian logistics staff deal with daily operative work in humanitarian logistics projects or negotiations with supply concerning goods for the beneficiaries in case of a disaster. Further quality management in humanitarian logistics is a needed competence in logistics and in particular humanitarian logistics e.g. quality management in procurement, transport, delivery, distribution and inventory management. 6

9 Humanitarian Logistics Performance through Education This research explores these and offers suggestions to improve and promote market and professional competencies and skills for the humanitarian logistics sector and to minimize their impacts by improving efficiency, working more cost-effective, finding solution in efficient way by a complex environment and humanitarian logistics management in a high quality as well as efficient. Based on the finding a first draft of Industry Qualification Framework (IQF) for the humanitarian logistics can be created as portrayed in slide 12. The IQF is subdivided in eight levels and in three subcategories namely knowledge, skills and competencies. The IQF facilitate the standardization and adaption especially for SME companies in logistics usually there are only few capacities and personnel in personnel education, therefore standards such as the IQF are useful. 7

10 Humanitarian Logistics Performance through Education 8

19 Performance measurement and reporting in the corporate responsibility report perspectives 3 Performance measurement and reporting in the corporate responsibility report perspectives of auditors vs. practitioners Kathrin Mohr Expediting relief efforts through logistics Deutsche Post DHL, the world's leading mail and logistics company with around 470,000 employees worldwide, recognizes that its market leadership comes with a special responsibility to use its core expertise in logistics and its worldwide presence to benefit the world. In the face of this responsibility, Deutsche Post DHL has entered into a strategic disaster management partnership with the United Nations in By becoming an integrated part of this internationally established humanitarian relief system, we are able to make an effective contribution to aiding disaster victims. As part of our GoHelp program, we provide the United Nations with access to our core competency in logistics, our global network and the logistics know-how of our employees at no charge. Our activities cover all phases of disaster management: Disaster Preparedness Preventative measures at airports with Get Airports Ready for Disaster (GARD): We prepare airport personnel and staff from disaster management agencies for the logistics challenges posed by natural disasters and their aftermath. Disaster Response Our Disaster Response Teams (DRTs) offer support after a natural disaster: Our employees provide on-site logistics support on a volunteer basis at airports to ensure the successful processing and dispatch of relief supplies. DRTs can be on the ground and operational within 72 hours after being called upon by the United Nations. Recovery - Employees help employees with the relief fund We Help Each Other (WHEO): Employees can use the WHEO fund to donate money to fellow employees who are victims of natural disasters Disaster Response Teams: Quick to mobilize when disaster strikes In cooperation with the United Nations Office for the Coordination of Humanitarian Affairs (OCHA), we have established a global network of Disaster Response Teams (DRTs) consisting of over 400 specially trained DHL employees who volunteer their time to the GoHelp program. The DRT network covers nearly all parts of the world considered vulnerable to natural disasters with three strategically located teams: the Americas (Panama), Middle East/Africa (Dubai) and Asia Pacific (Singapore). When the United Nations calls on us for support, we deploy our logistics experts to the disaster site airport within 72 hours. Once on the ground, our DRTs provide critical support in the movement of relief supplies, including unloading cargo planes and conducting professional warehousing and inventory at no charge. Our teams make sure that relief supplies can be forwarded expediently to the people in need. 17

20 Performance measurement and reporting in the corporate responsibility report perspectives Reporting standards vs. practical implications In a deployment situation, the inventory management is done manually by the members of the DRT. Since relief goods do not have unified barcodes, there is currently no system available to automatically scan relief good items. On the ground, the manual system works quite well, however, when trying to put the data together after the deployment, we found there may be gaps in the reporting. Also, when handling more complex items, such as medical equipment or drugs, the manual system is too slow. This is why we are currently developing an automatic barcode and scanning system for relief goods: The goods are assessed by a DRT member, the basic data, such as weight and size of the SKU, is put into the system and a customized barcode is generated. This way the relief goods will be tracked easily and consistently during the handling in our warehouse. 18

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31 Tracking of In-Kind Contributions - LogIK 4 Tracking of In-Kind Contributions - LogIK Isabelle de Muyser-Boucher UN OCHA is the part of the United Nations Secretariat responsible for bringing together humanitarian actors to ensure a coherent response to emergencies. The mission of UN OCHA is to mobilize and coordinate effective and principled humanitarian action in partnership with national and international actors in order to alleviate human suffering in disasters and emergencies, to advocate the rights of people in need, to promote preparedness and prevention and to facilitate sustainable solutions. UN OCHA follows five core functions: 1. Humanitarian coordination 2. Humanitarian advocacy 3. Policy development 4. Management of humanitarian information 5. Humanitarian Financing The problem in the humanitarian relief sector is the unsolicited and inappropriate donations therefore UN OCHA has implemented a specific performance measurement tool to optimize emergency response capacity namely LogIK that provides an adequate and efficient data about relief flights and in-kind contributions, to complete tracking of LOG Cluster and Financial Tracking Service (FTS). The tool offer systematic and predictable information and it is connected to other important databases such as RITA, Global Mapping of Emergency Stockpiles, SUMA/LSS, Virtual Osocc, FTS. The tool offer to the humanitarian actors a variety of value added service: Supports assessment of relief situation Enables focus on in-kind contributions in short supply Advocacy for use of cluster mechanisms May support standardization of items to be donated in disasters May long-term help reduce unsolicited donations The LogIK tool provides summarized and customized reports about InKind donations in kind of shelter, nutrition, water, health and other humanitarian relief items for each affected and offers following information: The total sum in USD and tons of InKind donations Shipper The number and quality of InKind contributios Number of the arrival and in which transport mode are used for the InKind donations 29

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38 The Effect of Earmarket Funding on Fleet Management for Relief and Development 5 The Effect of Earmarked Funding on Fleet Management for Relief and Development Maria Besiou In general optimization models in humanitarian logistics in the past have been using standard models without the required match with the specific situation of humanitarian relief operations. For example the special accountability of humanitarian organizations towards governments, donors and other third party co-operation partners was mainly neglected and standard supply chain or stakeholder models were applied. This research shows that with the simulation of this specific situation for the operational question of fleet management and sourcing many insights can be gained and applied to relief operations. Whereas standard assumptions from literature outline an advantage for centrally planned and isolated executed operations, humanitarian practice shows options for decentralization as well as simultaneous operations with earmarked funding (relief and development). And whereas literature assumes centralized decision systems to combine low cost with low service levels and vice versa for decentralized systems, the daily practice in humanitarian logistics talks about worse service levels in decentralized systems. Therefore the described model is based on system dynamics methodology in order to shed light on this specific question. The research model assumes development and relief operations in three different but neighboring countries and a time horizon of 150 years in order to reach stable final situations. Besides the centralized and decentralized model also a hybrid model of fleet sourcing decision making is applied. The following results can be obtained from the model: The combination of development and relief operations brings sever challenges to humanitarian organizations but can make sense and should be analyzed further in the future. In most simulation cases more decentralization brings lower service levels due to important restrictions in humanitarian operations. The donors funding may also (earmarked) contribute to further problems in service levels and efficient response to development and relief tasks as e.g. the number of donors in one target area decreases service levels in fleet management decisions according to the model simulation. Similar models should be extended to other operational tasks and areas as well as restrictions as these simulations may yield important knowledge in the form of rules of thumb for the practical decisions in the field. 36

39 The Effect of Earmarket Funding on Fleet Management for Relief and Development 37

47 Performance Measurement in Cross-Border Settings 6 Performance Measurement in Cross-Border Settings Richard van Dijk Background for the important humanitarian work of North Star Alliance is the recognition that viruses and diseases in Africa mainly spread via transport corridors. Especially truck drivers are prone to catching such diseases due to their transport routes and their working conditions with long working hours and less physical activity (e.g. coronary heart diseases, type 2 diabetes, cancer, HIV, STI, malaria and tuberculosis). Therefore an effective restriction to these diseases and challenges to economic growth in African regions should be addressing the transport corridors themselves and therefore North Star Alliance is putting up roadside wellness centers in order to support truck drivers, sex workers and community members alike. Today after several evolvement steps the initiative is operating 25 such centers in 10 African countries and provides support and counseling for up to 200,000 persons annually (2011). The networking objective is to establish altogether 100 centers until 2015 this would enable the initiative to reach out to about 85 % or all Sub-Saharan truck drivers. Though the settings provide a lot of setbacks and restraints (resources, mobile target population, cross-border setting with different regulations) the initiative is starting to be recognized as important and positive by the people. Even more challenges sometimes arise from the multi-stakeholder setting as public health authorities enter turf fights with individual health and occupational health institutions about North Star Alliance activities. Therefore the initiative has set out three layers of activity for different people to reach in order to avoid adverse effects by rejection from only the disease-struck groups: In the first level, all moving persons along transport corridors are provided with non-medical services and research/counseling. Second obvious clients with specific needs and requests receive primary and occupational health services. And third patients with open diseases receive treatment and pharmaceuticals addressing these open diseases. According to this specific mission the initiative has established a COMETS data system providing data along disease patters and treatments as well as patient tracking across borders and country specific protocols and medication. This is the core and backbone of the distributed services among different countries as without an accurate patient history of the travelling patient no professional service can be administered. Furthermore the database is also used for improvement options and also network extensions, e.g. as input data for a POLARIS transport corridor simulation identifying the next promising locations for wellness centers in Africa along transport routes. 45

48 Performance Measurement in Cross-Border Settings Altogether these specifics of North Star Alliance show tremendous potential for benchmarking and improvement comparing this strategic and information-backed concept with other development and relief institutions. Many extensions and also co-operations e.g. in transportation and stock-keeping seem interesting for other institutions together with this initiative. 46

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62 Planning and optimizing relief systems in humanitarian logistics 7 Planning and optimizing relief systems in humanitarian logistics Abbas Al-Refaie, Bernd Noche, Melissa Robles The specific situation in disaster areas by flooding, earthquake or other natural disasters usually hinders relief operations very much this being one of the main problems and also differences compared to traditional models in commercial logistics, which can only in exceptional cases be used for humanitarian logistics. Therefore this research contribution shows the elements and features of an integrated planning and optimization system specially designed for humanitarian logistics in an international cooperation of the University of Duisburg-Essen (Prof. Dr.-Ing. Noche) and the University of Jordan (Prof. Dr.-Ing. Al-Refaie). In comparison to commercial logistics, on the humanitarian scene the demand has its origins at unknown locations, at unknown times and its sizes is difficult to forecast. Another challenge is that in humanitarian logistics a fair distribution of relief items is an important decision criteria as the human condition of the affected ones should be respected. Despite of the urgent situation, the relief deployment should be optimized to guarantee lower logistic costs as this allows the allocation of the resources for the purchasing of the relief items itself. Short delivery times are important criteria as well to save lives. The presented transportation model is designed to fit exactly to these requirements of emergency and relief situations. It was tested with data from the 2010 Haiti earthquake and delivers a better (fairer) distribution of donations to different disaster areas. The mathematical model has three optimization criteria (cost minimization, delivery time minimization and credibility maximization), three network elements (donor countries, collection points and devastated locations) as well as two pattern schemes deployed (4 donation periods; 4 recovery periods). Especially the modeling of decreasing the credibility as the delivery time increases with a degressive function can be seen as a new research contribution in this context. This implies an interesting steering mechanism for model solver processes as there is an intrinsic motivation to deliver relief goods as soon as possible. The model was tested with the donor countries Austria, Mexico, Spain, Lebanon, Germany and Canada for the specific locations of Port-au-Prince, Gressier and Jacmel devastated in the Haiti earthquake Data has been taken from the UNOCHA, IFRC and WFP offices regarding the donations and also deliveries to Haiti. Results for earliest and also cost-optimal delivery times show that dependency on credibility levels is quite high. This could be a precursor for further modeling as well as the option of relief managers to determine the weight of this credibility and therefore delivery time effect for each individual disaster. 60

63 Planning and optimizing relief systems in humanitarian logistics Altogether the model shows a very promising as efficient allocation regarding the humanitarian logistics-specific question of delivery time (equal human lives, equal credibility of relief organizations) versus delivery cost in disaster cases. Therefore this approach should further be enhanced and tested in live-disaster situations. And furthermore it should be integrated in as many government and non-government, military and non-military contexts and simulation endeavors in order to enhance the level of abstraction and also training for site managers in operational logistics situation in the field worldwide. 61

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74 Critical Success Factors in the Supply of Humanitarian Aid 8 Critical Success Factors in the Supply of Humanitarian Aid Stephen Petit, Anthony Beresford Dear ladies and gentlemen, welcome to my presentation with the topic critical success factors in the supply of humanitarian aid. Four points are on the agenda. We will start with a short introduction, then the backgrounds and the CSFs in humanitarian logistics and we will end with a conclusion. Aims of humanitarian logistics are to identify critical factors to the success of humanitarian aid supply chains, variables within those factors which contribute to their effectiveness and access how such factors can assist agencies in improving strategy and response. Humanitarian logistics is often the largest and most complex element of relief operations. In practice and science we need requirements for a clear understanding of problems and issues. In context to crises situations it is uncertainty difficult. To solving problems the understanding factors are crucial. The Hurricane Katrina or the Indian Ocean tsunami illustrates that the perception of actual delivery systems failure in Humanitarian logistics. The theoretical understanding of humanitarian supply chains is little development and the diverse natures of humanitarian community have not fully understood this. Further backgrounds are that the crisis response is short term, establishment of supply chains takes place under high stress conditions and we have to answer the question to consideration of alternative approaches. But the research is poorly funded or not funded at all. Many logistics processes are similar to commercial logistics but it is often not possible to transfer the business to humanitarian logistics processes. The major differences are: Funding Employment Location Instability Lack of logistics knowledge Other problems are the lack of technical knowledge in humanitarian organizations and the insufficient experienced logisticians. A literature review illustrates the keys like (a) strategic planning, (b) Inventory Management, (c) Transport Planning, (d) Capacity Planning, (e) Information Management, (f) Human Resource Management, (g) Continuous Improvement, (h) Collaboration and (i) Technology Utilization. 72

75 Critical Success Factors in the Supply of Humanitarian Aid (a) Strategic Planning In the field strategic planning long term decision making are required. This affects the corporate strategy, transportation and warehousing, location of distribution centers, outsourcing of non-core activities, budgets, capital acquisition, resource deployment and effective use of skills. (b) Inventory Management The inventory management is one of the logistics core function. In accordance to humanitarian logistics the inventory management has to address the existing inventory, in-country supplies accessible at short notice. Furthermore the inventory management has to consider lead times for supply of critical items, flexibility of process and product prerequisite for responsiveness to changing situation and time values of commodities greater than inventory carrying costs. (c) Transport Planning For the disaster relief in transport planning following critical factors are important. To mentioned are mode, utilization of capacity, scheduling and maintenance. Here are concerned the transport activities and the transport range cross over between existing programs and short term emergencies, competition for the same transport capacity in emergency situations increases costs and a mixture of public, private, military capability. (d) Capacity Planning For capacity planning the short and long term demand is impacted. This has implications for the numbers of warehouses and distribution centers, vehicles, equipment and employees. But by collaboration with other organizations the capacity can be increased. Other transport and logistics infrastructure may also affect capacity like ports or airports. (e) Information Management In humanitarian logistics the information management is an important aspect too. Tasks like the integration of activities and provide information, Track and Trace and network management allocate the information management. Varieties of systems have been developed like the UN international emergency network, the international food aid information system and the fritz institute supply chain management software. (f) Human Resource Management Human resource management has to pull together disparate function effectively. In humanitarian logistics trained logisticians are important. They are often poor at local level but best at international level. The lack of staff can jeopardize response. Often flexible staff policies recruit or move staff once a crisis occurs only. 73

76 Critical Success Factors in the Supply of Humanitarian Aid (g) Continuous Improvement An absolute necessity is the continuous improvement approach. A range of tools to monitor and compare the performance can use like tracking key factors in supply chain performance, benchmarking, key performance indicators ant it performance measurement. (h) Collaboration Collaboration is important for achieving integration and efficiency. With collaboration supplier relations can close and lower purchase costs can be realize. With commercial organizations collaboration can improve distribution networks. It is more difficult to optimize collaboration. The definition by fritz institute illustrate it: lacking any standard operating procedures or common understanding of the roles each would play, on-site coordination and management among the humanitarian organizations was not optimized. Competing supply chains for procurement and transportation caused congestion at local airports and roads, taxing already limited capacity. Particular in practice ad-hoc collaboration may be useful in short term bit in longer term less useful. Lack of effective collaboration can impact on other areas. (i) Technology Utilization It is important to utilization the existing infrastructures but redundant technology is not necessarily redundant. The most effective method is the real time communication. For example the Asia tsunami initially largely cellular and satellite largely cellular and satellite phone before one week 50% organizations on . Problems could lead by over reliance on one type. 74

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90 Agility in Humanitarian Supply Chains 9 Agility in Humanitarian Supply Chains David Knight, Stephen Petit and Anthony Beresford Dear ladies and gentlemen, I wish you a warm welcome. Five points have the agenda. We start with an introduction then I will describe the lean and agile principles the key challenge and the last point is the interpretation and conclusion of my presentation with the topic agility in humanitarian supply chains. In frequency natural disasters are increasingly. As example hurricane Katrina in 2005, the Australian floods in 2010/2011 and the Tohoku earthquake & tsunami in 2011 can called. So it is important that volatile business environments needs agile supply chains. Two differentiate definitions can noticed: The first definition by Charles et. al by constantly working in environments with high degrees of uncertainty, humanitarian organizations end up becoming specialists in the implementation of agile systems and the second by Tatham & Petit the application of commercial supply network management theory and practice has received limited consideration within humanitarian logistics literature to date. In reference to these definitions the research objective is as follow: To examine the shortcomings of humanitarian aid logistics in response to natural disasters. The research methods which are conducted in 2011 are: Participants: Logistics practitioners and directors from 10 humanitarian aid organizations 1 st stage: semi-structured interviews 2 nd stage: questionnaire survey of 21 open-ended questions minutes for each interview Different understandings of agility and flexibility can find in literature. But another question is if supply chains are lean or agile? So many supply chains combine lean and agile elements. When the demand is stable and predictable it can use the lean principles, when the market is turbulent and uncertain a hybrid strategy can applied. A suggestion is that humanitarian organizations are already agile and commercial business should take note of their compatibilities. Another argumentation is that humanitarian organizations lack some of the fundamental characteristics that allow an agile supply chain to operate. So the question is: Any challenges for agile strategies in humanitarian logistics? 88

91 Agility in Humanitarian Supply Chains The key challenges as follow: 1. Agile and lean strategies 2. Customer/marked sensitivity 3. Virtual integration 4. Process integration 5. Network integration 6. Leagility 7. ICT and technology To deal with different scenarios like droughts, earthquakes, floods and cyclones some organizations have several plans and strategies. The importance of having ability to approach disaster with a broad degree of flexibility some organizations highlight it. In Some response there was evidence of leagile strategy, the new global strategy is faster, cheaper and better. Process oriented and a virtually integrated through shared information implies agility. Prepositioned stock levels of items that are of equal importance to everyone hold organizations. A direct procurement is required, for unusual items. A determinded need rather than forecast based all provision of goods be it from stock or production always. Humanitarian Organizations follow a top-down approach and do not provide the choice to consumer. For the procurement of relief supplies and a lack of clear communication respondents highlighted many layers of approval between procurement and logistics as a hindrance. Often there is no data sharing across organizations and suppliers. But usually more are information than data. The systems are not robust enough and often incompatibilities between suppliers and humanitarian organizations systems. The element of process integration is that many of the organizations find the idea of implementation of a vendor managed inventory an interesting point. But usually the skills for an implementation are missing. But some organizations have introduced some aspects of the vendor managed inventory. Within a network a possibility is that organizations enhance their agility by making use of the capacity, capabilities and resources. But usually the transparence is missing. Leagility means that many organizations use prepositioned stock but keep this to a minimum. They order goods that are not generic. The stock management is often customized. The last point the ICT and technology needs a significant use of technology to enable connectivity in real time. The humanitarian organizations know the importance of a better ICT and technology and looking actively for seeking ways in which can be improve. This can occur when humanitarian donors fully appreciate the importance and value of providing resources for appropriate ICT and technology. In different organizations it appears there is variation in the emphasis put on logistics and supply chain management. None of the organizations have taken a holistic approach. 89

92 Agility in Humanitarian Supply Chains Logistics is more a functional rather than a strategic perspective for humanitarian organizations. Postponement principles often used. The implementation of vendor managed inventory in some form with success but they are far from being fully integrated and realized a holistic approach. The biggest challenges for agility are: Lack of investment in ICT Unreliable suppliers Lack of strong relationship with suppliers Lack of coordination with other HA organizations Lack of collaboration with other members within their Supply Chains Suppliers are not reliable and not capable of providing goods at short notice on the just-in-time principles, despite demand driven supply chains. 90

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105 Performance measurement in humanitarian logistics 10 Performance measurement in humanitarian logistics Dorit Bölsche The research is structured in four points. The first point introduces the state of the art, followed by the SCOR model. The third point explains the implementation of the SCOR model in a humanitarian supply chain, the research is concluded by a discussion about the limits and the needs for further research. The first slide shows a relevant quotation: Drought and the complexity of its impacts: As for almost every year, droughts strike everywhere on earth their impacts increasing in magnitude and complexity due to the effects of a changing climate. Understanding the complex impacts of drought could be the key to enhancing drought mitigation and preparedness. The Sahel and West Africa are among the most vulnerable regions to future climate fluctuation this explains that performance measurement could be the key to understand the complex impacts of draught. And that with a special focus on humanitarian logistics it can be the key to enhance preparedness and therewith to lower the consequences for the affected people and countries. The State of the Art was acknowledged with seven bullet-points: Fritz Institute has 4 KPIs (appeal coverage, donation-to-delivery time, financial efficiency, assessment accuracy) World Bank: Logistics Performance Indicator, LPI with 6 components (efficiency of the clearing process, quality of infrastructure, ease of arranging competitively prices shipments, competence and quality of logistics service, ability to track and trace, shipments on schedule) Organizations dealing with performance, visibility, transparency, accountability and standardized reference models, e.g. INSEAD, Humanitarian Logistics Association (HLA), Kühne Foundation, German Logistics Association (BVL), Active Learning Network for Accountability and Performance in Humanitarian Action (ALNAP, e.g. Balanced Scorecard). Standardized performance measurement is still not established in humanitarian logistics Most academic work refers to key performance indicators in humanitarian logistics Commercial organizations are successful in using reference-models and performance measurement Until now, a standardized reference-model to evaluate performance in humanitarian logistics doesn t exist The main research question is if humanitarian aid organization can implement successfully a reference-model which includes performance measurement? 103

106 Performance measurement in humanitarian logistics Furthermore the general Supply-chain operations reference-model (SCOR) is described and introduced. The SCOR model is a process reference model which developed in 1996 by the Supply Chain Council as the cross-industry de facto standard diagnostic tool for supply chain management. SCOR enables users to address, improve, and communicate supply chain management practices within and between all interested parties in the extended enterprise. SCOR is a management tool, spanning from the supplier's supplier to the customer's customer. The model is based on three major pillars: Process modeling, Performance measurements and Best practices. It is based on five level 1 management processes: The Plan processes describe the planning activities associated with operating a supply chain. This includes gathering customer requirements, collecting information on available resources, and balancing requirements and resources to determine planned capabilities and resource gaps. The Source processes describe the ordering (or scheduling) and receipt of goods and services. The Source process includes issuing purchase orders, scheduling deliveries, receiving, shipment validation and storage, and accepting supplier invoices. The Make processes describe the activities associated with the conversion of materials or creation of the content for services. It focuses on conversion of materials rather than production or manufacturing because Make represents all types of material conversions. The Deliver processes describe the activities associated with the creation, maintenance, and fulfillment of customer orders. It includes the receipt, validation, and creation of customer orders; scheduling order delivery; pick, pack, and shipment; and invoicing the customer. The Return processes describes the activities associated with the reverse flow of goods back from the customer. The Return process includes the identification of the need for a return, the disposition decision-making, the scheduling of the return, and the shipment and receipt of the returned goods. The third part gives an overview about the world food programme and discussed why the SCOR model was used in the field of humanitarian logistics. Unlike normal logistics business processes in the field of humanitarian logistics, the donors had to be considered. At the Level 1 implementation performance goals have to be adjusted to the humanitarian aid sector. Terminology should be changed. Plan and source can be implemented. Make -process has to be transformed and Return can be implemented. Following is an explanation of the requirements based on the structure of the SCORmodel 10.0 on the second level based on 5 core processes and 26 process categories. The level 2 implementation depends on the following factors. Plan: 12 of 16 processes are applicable; 4 plan make -processes can be dropped; they are covered by plan deliver. Source: All source-processes are implementable; separation of products into: make-to-order, engineer-to-order and stocked products; probably source stocked products. Make: Only some processes can be transformed. Deliver: All processes are applicable; minor adjustments. Return: All processes are suitable to WFP. 104

107 Performance measurement in humanitarian logistics The Level 2 implementation, performance attributes are Reliability as ability to perform tasks as expected, responsiveness as speed at which tasks are performed, agility as ability to respond to external influences and the ability to change, costs as costs of operating the process and assets as ability to efficiently utilize assets. Later on the adaptation of the Level 3 and 4 of SCOR to the humanitarian logistics sector was described and explained. In the last part shows the limits and the need for further research. For Example might the complete integration of all suppliers (especially raw material suppliers) be difficult. Access to suitable software and adequate human resources is restricted. To perform an inter-industry benchmarking more than one humanitarian aid organization has to implement SCOR. And individual adjustments and additions are required. The conclusion shares some ideas for the future: So the SCOR model has to be worked out for humanitarian logistics in detail. The whole supply chain has to build up and integration of statistics and indicators into planning and forecasting is even necessary as an intersectional collaboration. 105

108 Performance measurement in humanitarian logistics 106

120 Die Veranstalter 11 Die Veranstalter FOM Hochschule Die FOM Hochschule ist mit rund Studierenden und mehr als 25 Studienorten bundesweit Deutschlands größte private Hochschule. Sie versteht sich als Ergänzung zur staatlichen Hochschullandschaft. Ihre Bachelor- und Masterstudiengängen finden in Präsenzform außerhalb der regulären Arbeitszeiten abends und am Wochenende statt. Mit diesem speziellen Studienkonzept richtet sich die gemeinnützige Hochschule vorwiegend an Berufstätige und Auszubildende, die parallel zum Job studieren wollen. Die FOM legt großen Wert auf die Verknüpfung von wissenschaftlichem und praxisorientiertem Wissen. So werden zum Beispiel die Inhalte des Studiums dem betrieblichen Alltag der Studierenden angepasst. Oft werden Probleme und Aufgaben direkt aus den Unternehmen im Hörsaal bearbeitet, die Studierenden erhalten anwendbare Lösungen für ihre Arbeit. Diese Verbindung von Theorie und Praxis spielt auch bei der Auswahl der Dozenten eine große Rolle. Die Professoren zeichnen sich sowohl durch wissenschaftliches Know-how und methodisch-didaktische Kompetenz als auch durch Berufserfahrung aus. Sämtliche Abschlüsse an der FOM sowie die Hochschule selbst als Institution sind staatlich anerkannt. Diese Auszeichnung spiegelt die hohe Qualität der Forschung und Lehre an der FOM Hochschule wider. Weitere Informationen finden Sie unter: 118

121 Die Veranstalter ild Institut für Logistik- & Dienstleistungsmanagement Drei Jahre Logistikforschung an der FOM Hochschule: Die Logistik ist großen Veränderungen ausgesetzt: wachsende Energie- und Transportkosten, Einbindung in Produktions- und Distributionsprozesse, komplexere Dienstleistungen und die höhere Bedeutung von Nachhaltigkeit. Ohne intensive Forschung sind diese Herausforderungen kaum zu bewältigen. Die Untersuchung innovativer und nachhaltiger Logistik- und Dienstleistungskonzepte in den Bereichen Produktivitätsmessung, Qualitätsmanagement, Prozessmanagement und Operations Research ist die Kernkompetenz des ild Instituts für Logistik- & Dienstleistungsmanagement an der FOM Hochschule. Besonderen Wert legt das ild, unter Leitung von Prof. Dr. Matthias Klumpp, auf den anwendungs- und wirtschaftsorientierten Transfer seiner Forschungsergebnisse in die Betriebe. Dafür nutzt das Institut ein Netzwerk von Wissenschaftlern sowie Praktikern aus Unternehmen, deren Know-how es zielführend verbindet. Außerdem kann das ild auf eine Vielzahl von Kooperationen zurückgreifen: darunter Forschungseinrichtungen wie das Zentrum für Logistik & Verkehr der Universität Duisburg- Essen, das Institut für Logistik und Unternehmensführung der Technischen Universität Hamburg-Harburg oder die Technischen Universität Istanbul. Auch Wirtschaftspartner wie zum Beispiel DB Schenker, der Verband Spedition und Logistik Nordrhein- Westfalen oder die duisport-gruppe unterstützen die Arbeit des ild. In den drei Jahren seit der Gründung des Forschungsinstituts kann das ild auf eine Reihe von erfolgreichen Projekten und Veröffentlichungen zurückblicken. Derzeit untersucht das ild die Probleme des Gefahrguttransports in der Türkei und Deutschland im Projekt DAGERTY und erforscht Möglichkeiten der wissenschaftlichen Weiterbildung in der Logistik (WiWeLo). Mit diesem Projekt ist das Institut auch im Effizienz- Cluster Logistik Ruhr vertreten. Weitere Informationen finden Sie unter: 119

122 Program 2 nd International HumLogWorkshop Essen 2012 Performance Measurement in Humanitarian Logistics 24 th of September 2012 Essen, Germany Program 08:30 // Registration 09:00 // Introduction Dr. Harald Beschorner - Chancellor - FOM Prof. Dr. Thomas Heupel - VR Research - FOM 09:15 // Keynote Prof. Dr. Matthias Klumpp - FOM ild 09:30 // Success factors in humanitarian aid supply chains Prof. Dr. Anthony Beresford - Cardiff Business School 10:00 // Agility in humanitarian aid supply chains Dr. Stephen Pettit - Cardiff Business School 10:30 // How to measure quality in humanitarian operations?- Challenges in developing performance measurements for the International rescue committee Ira Haavisto - Gyöngyi Kovacz - Hanken HUMLOG Institute Jarrod Goentzel MIT 11:00 // Planning and optimizing relief systems in humanitarian logistics Prof. Dr.- Ing. Bernd Noche - University Duisburg Essen Prof. Dr.-Ing. Abbas Al-Refaie - University of Jordan 11:30 // Track 5 N.N. Ute Hoffmann - action medeor 12:00 // Lunch 13:30 // Cooperation in procurement among organizations of the UN system at the field level Dr. Blecken UNICEF 14:00 // Performance measurement in cross-border settings: The case of health services delivery in low-income settings Luke Disney - North Star Alliance 14:30 // Performance measurement and reporting in the corporate responsibility report - perspectives of auditors vs. practitioners Kathrin Mohr - DHL 15:00 // Coffee break 15:30 // Performance measurement in humanitarian logistics Prof. Dr. Dorit Bölsche - University of Applied Sciences Fulda 16:00 // The Effect of earmarked funding on fleet management for relief and development Prof. Dr. Maria Besiou - KLU Prof. Dr. Luk van Wassenhove - INSEAD 16:30 // Closing session Hella Abidi - Prof. Dr. Matthias Klumpp - FOM ild 120

123 The topic of this workshop was how to optimize the humanitarian logistics process, coordination and cooperation in the humanitarian logistics sector and all activities in a disaster case. Humanitarian logistics activities mainly emphasize effective management and organization of the flow of goods, information and persons during and after disasters. Therefore, it must be said that the main objective of humanitarian operations is to alleviate suffering and vulnerability, and to save the lives of those affected by disasters, whether natural or man-made. The efficient organization of such humanitarian operations relies on the support and supply chain management of logisticians on- and off-site. Aachen Berlin Bochum Bonn Bremen Darmstadt Dortmund Duisburg Düsseldorf Essen Frankfurt a. M. Freiburg Gütersloh Hagen Hamburg Hannover Kassel Köln Leipzig Mannheim Marl München Neuss Nürnberg Offenbach Siegen Stuttgart Unna Wesel Wuppertal