Supply And Demand In A Humanitarian Supply Chain Commerce Essay

As bulk of Supply Chain research is focussed on managing and optimizing the commercial supply of goods and services, Human-centered Supply Chain has received less attending. However, in the current planetary scenario, due to increasing population and developing substructure, more accent has been given on the unpredictable exigencies ( like temblor, inundations and so on ) wherein 1000000s of lives will be at interest and would depend on the equal and timely supply of nutrient and other resources. In Human-centered Supply Chain, due to its singularity, more accent should be given on demand uncertainnesss and managing and optimizing stuff flow to be delivered to the right people, at right clip and to the desired location.

As Human-centered Supply Chain operates on mission critical undertakings, clip is the critical factor than cost and should be given ample importance. Supplies consist of alleviation points, personnel/ voluntaries, transit and building resources and others. Major factor in the supply facet is the inappropriate timing and measures to be delivered and arrived. There are many critical issues encountered in the storage and transit of alleviation points due to inappropriate bringing and reaching and besides due to miss of execution of appropriate SC scheme ( Push and Pull which would be explained subsequently ) . There have been many instances in the past including major catastrophes like Tsunami, wherein jobs were encountered in transparence in the Supply Chain ( deficiency of Corporate Social Responsibility/ CSR ) , tracking and following of supplies ( right measures including pecuniary and other resources to be delivered to the desired location ) .

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Customers in a Human-centered ( Disaster ) Supply Chain include the population at the affected country and besides intermediate clients in the local or planetary storage installations and depend on the type of catastrophes and the timeline. Disaster demand calculating would besides be hard due to the deficiency of historical informations regardless of care of databases by both NGOs and authoritiess and would sometimes be unequal due to inappropriate/ inconsistent informations aggregation and coverage jobs. Catastrophes are fundamentally alone regardless of locations and depend on the population construction, economic conditions and so on.

Coordination and direction of Disaster Supply Chain has disputing jobs. The supply web is really big and involves many participants like Donors, NGOs, Government, Military and Suppliers and it is really hard to organize all the points amongst all the participants. Despite the different cultural, political, geographical and historical differences among them, coaction and specialisation of the undertakings between NGOs, military, authorities and private concern are progressively needed in the human-centered supply ironss ( Van Wassenhove, 2006 ) . Despite holding good consciousness of cardinal points in the Human-centered Supply Chain, Logisticians in most NGOs or other Human-centered Organisations would non be specialised in utilizing the tools and techniques for work outing the jobs that would happen during the operations. Besides, ends and public presentation prosodies of Human-centered and regular Supply Ironss do vary well.

Table 1.1 Differences between Commercial and Humanitarian Supply Chain:

Commercial Supply Chain

Human-centered Relief Chain

Demand Pattern

Demand form is comparatively stable and predictable and occurs from fixed locations and in set measures.

Demand is extremely unsure and unpredictable in footings of location, timing, type and size. Demand demands are estimated based on the appraisal of catastrophe features.

Lead Time

Lead clip would be determined by the Supplier-Manufacturer-DC-Retailer concatenation.

Zero ( approx ) lead clip demands ( between the happening of the demand and the demand for the demand ) and the existent lead clip would be still determined by the concatenation of stuff flow.

Distribution Network Configuration

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

Challenging and unpredictable due to the nature of terra incognitas ( location, timing, type and size ) .

Inventory Control

Inventory degrees are determined based on chiseled methods on demand, lead clip and aim client service degrees.

Inventory control is really much challenging due to high fluctuations in the lead clip, demand and the location.

Information System

Chiseled with advanced engineering.

Information is extremely ambitious, undependable, deficient and inconsistent.

Strategic Tools

High quality merchandise or service at low cost to maximize net income border and increase client satisfaction.

Minimise loss of life and relieve agony [ Thomas ( 2003 ) ] .

Performance Measurement System

Focussed on resource public presentation steps such as maximizing net income border or understating the cost.

Primary focal point would be on the end product public presentation steps such as the clip required to react to a catastrophe or the ability to run into or transcend the demands of the catastrophe ( client satisfaction ) .

Percept of demand


Supplies and Peoples

1.2 Relief Mission Life Cycle:

Figure 1. 1 Relief Mission Life Cycle [ modified from Thomas ( 2002 ) ]

There are fundamentally four distinguishable stages for the life rhythm of a alleviation mission.

1 ) Appraisal: Based on the catastrophe features, minimum resources are required to place the demand.

2 ) Deployment: Ramping up of resource demands to run into a coveted demand.

3 ) Sustenance: Operationss are sustained for a certain period of clip.

4 ) Reconfiguration: Operationss are reduced, and so terminated.

The above life rhythm will be experienced by all the Human-centered Organisations reacting to a catastrophe. After the reconfiguration rhythm of the alleviation mission, there would be happening of another deployment rhythm related to the development attempt.

2.0 Stakeholders in a Human-centered Relief Supply Chain:

The following are list of Stakeholders in a typical Humanitarian ( Disaster ) Supply Chain:


Non Governmental Organisations ( NGO ) / Human-centered Administrations






In a typical Human-centered Supply Chain, Government and NGOs are the Primary Stakeholders involved in the operation. Governments hold the chief power with the direct control over political and economic policies which would impact the flow of Relief Supply Chain. After the 2004 tsunami, for case, the Indian authorities did non ask for international assistance bureaus to take part at all in the first 60 yearss of the alleviation attempt, and functioned during that period with the local beginnings of supplies ( Thomas and Fritz, 2006 ) . Donors, Military and the Media are the other important Stakeholders in the Relief Supply Chain.

3.0 Designation of Specific Humanitarian Relief Supply Chain:

The chosen Humanitarian Supply Chain activity is on the Tsunami catastrophe which took topographic point on 26th of Dec 2004 impacting Indonesia, Sri Lanka and South India. Tsunami was a immense catastrophe which affected batch of lives, substructure and changed the economic degree of the state. Tsunami did put a challenge for the Human-centered Logisticians to react to the most unsure alleviation operations and forecast the unsure demand with the existent clip informations.

4.0 Identification of challenges at Macro, Meso and Micro degree for the Tsunami catastrophe Supply Chain:


1 ) Lack of trained logicians within Human-centered Administration:

2 ) Ad-hoc internal operations ( Supply Chain procedure ) :


1 ) Limited coaction and coordination:

2 ) Catching understandings


1 ) Policies and political force per unit area

2 ) Economic instability

3 ) Customss and operating processs:

5.0 Tsunami catastrophe Supply Chain Relief procedure:

Figure 5.1 Relief Supply Chain ( Thomas, 2004 ) modified by Mizushima

5.1 Analysis of issues in the Tsunami Relief Chain procedure:

Harmonizing to the study conducted by the Fritz Institute, batch of international Organisations did meet issues with respects to human-centered logistics after the Tsunami catastrophe. The following are the elements of the Tsunami Relief Chain procedure and shows the issues concerned with them.

1 ) Readiness:

This measure shows the effectivity of the program of action prepared by the Organisations for the catastrophe alleviation. Harmonizing to the study, original programs developed by the Organisations for the Tsunami catastrophe alleviation were non accurate plenty to follow the established procedures and travel expeditiously to the following stairss of appraisal, entreaty and resource mobilization. As per the study, most of the Administrations involved with the Tsunami alleviation agreed on the communicating processes as one of the root causes of inaccurate original program of action.

2 ) Appraisal and Entreaty:

During Tsunami catastrophe, most of the Organisations did non hold accurate information on the figure of donees, locations and other plans due to the deficiency of handiness of clear land information. Lack of trained local staff and devastation of substructure restricting entree to impacted countries made many Organisations unable to leverage cognition from other Administrations and counterbalance these challenges in obtaining better information.

Another major issue was the cognition of the assessment staff carry oning the appraisal of the information on the tsunami affected parts. As most of the appraisal squad members were international, the deficiency of squad members with local cognition and skilled logicians made them hard to garner utile information.

3 ) Resource Mobilization:

Analysis of resource mobilization was based on three classs: Financial Resources, Human Resources and Organisational Set Up.

Fiscal Resources:

The strength of devastation caused by Tsunami created an exceeding response from Peoples and Organisations around the universe. However many Administrations did reference that fiscal resources were unequal during the clip of the catastrophe.

Human Resources:

When analyzing the mobilization of Human Resources, the study did analyze the quality, measure and developing degree of the staff at the regional, national and international degree. Based on the research, it was examined that international staff members were rated to hold more expertness ; nevertheless they were non able to get by with the cognition of local affected parts.

Besides, there were some undertaking issues during the alleviation operation. Many Organisations did implement impermanent catching scheme for 1-3 months and there were merely little per centum of Contractor understandings which lasted for more than 6 months and these schemes did originate a batch of issues related to mobilization of Human Resources to different affected parts.

Organisational Set Up:

4 ) Procurement:

Although many Human-centered Administrations had pre-established procurance procedures, over half of them did see procurance holds at the clip of Tsunami catastrophe alleviation. Many Organisations did trail for same points and with same measures doing deficits and more holds ensuing in the inappropriate executing of the proposed procurance program.

Many Administrations had pre-established model understandings with their providers for nutrient points, medical supplies and vehicle with latter bespeaking higher per centum. Merely little per centum were allocated to nutrient points due to which many Organisations did confront many fusss like deficit of nutrient supplies to be delivered to the desired location.

Besides, prioritizing solicited from unasked contributions did hold an impact on the Tsunami alleviation concatenation. However merely some Human-centered Organisations had established procedure of prioritizing these contributions before they were allowed to make the affected finishs. Finally, deficiency of Corporate Social Responsibility ( CSR ) with many Administrations did do many unethical patterns with inappropriate procurance scheme in topographic point and impacting the alleviation procedure.

5 ) Transportation system Execution:

Destruction of substructure such as roads and landing fields and besides imposts holds did cite many fusss to transit executing. Many Human-centered Organisations did meet jobs in measuring the affected locations particularly in Indonesia and Sri Lanka which created a batch of congestion for many Administrations for the limited conveyance capacity through choppers or on few working roads.

Second, there were many holds in the transit of peculiar points like medical supplies due to feverish imposts processs at the airdrome. Besides, deficiency of communicating of the alterations in processs including imposts and other demands and shear volume of goods did cause constriction to many Administrations.

6 ) Trailing and Tracing:

Harmonizing to the study, many Human-centered Organisations did utilize ad-hoc solutions like Excel spreadsheet and manual functionality to update the procedure of path and hint and merely 26 % of them used package based engineering to manage path and hint procedure for procured merchandises. Due to this, many Organisations did confront constriction state of affairs in having the regular updates on critical information along the Supply Chain

7 ) Stock Asset Management:

Most of the respondents stated they had repositing and stock list direction systems and processs in topographic point and 85 % stated they met the demands of the operation. While these systems met their demands, the organisations deployed them in new locations. 71 % reported that they did non utilize already bing regional logistics set-ups, therefore compeling them to make fresh local constructions for this response.

Not all stock lists were put into topographic point after the Tsunami struck. Recent attempts have been made to strategically pre-position stock. By looking at the single responses in the tabular array below, pre-positioning occurs chiefly at the international degree with lone modest success. At the regional degree and below, pre-positioning is non common and when used non able to run into demands. Future work could find why the pre-positioning did non execute better.

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

An drawn-out bringing point/ POD is an inland finish near to affected countries wherein goods can be staged before allowing them to donees. During Tsunami alleviation operation, many Organisations faced batch of jobs with limited POD ‘s and affected other procedures in the alleviation concatenation.

Monitoring, Evaluation and Reporting:

Monitoring and rating create the information base for determination devising during the execution of alleviation concatenation. Lack of logistics trained forces, trusting on ad-hoc manual monitoring, rating and coverage procedure than Information Technology ( IT ) systems caused many Human-centered Administrations hard to mensurate their alleviation concatenation ‘s budget public presentation, speed public presentation, efficiency, and quality against the targeted consequence ( Forecast ) .

Communication, Collaboration and Coordination:

Basically, coaction was done based on ad-hoc, “ immediate demands ” footing. Many Human-centered Organisations did fight to get by with their internal operations and desire to work with other bureaus was in vena. Lack of operating processs, wrongness in the alleviation concatenation procedure and deficiency of optimization of on-site coordination and direction did do these Organisations face the constriction state of affairs during the Tsunami alleviation.

5.2 Logisticss Flows:

Figure 5.2.a Merchandise Flows

Figure 5.2.b Information Flows

Figure 5.2.c Financial/ Cash Flows

Figures illustrate the three types of flows along the Relief Supply Chain.

Physical logistics flows occur between the undermentioned procedures: Resource mobilization, procurance, transit, stock plus direction and extended point of bringing.

Information flows connect the undermentioned alleviation concatenation procedures: Readiness ; appraisal and entreaty ; path and hint ; monitoring, rating and coverage ; and communications.

Financial/ Cash flows take topographic point during the subsequent procedures: Readiness ; appraisal and entreaty ; procurance ; and monitoring, rating and coverage.

6.0 Modelling, Simulation and Optimisation of Tsunami Relief Chain Procedure:

Modeling and Simulation techniques for the Human-centered Supply Chain are far different from Commercial Supply Chain. Unlike Commercial Supply Chain, Humanitarian Supply Chain elements such as stock list direction, distribution web modeling and transit planning requires meaningful analytical theoretical accounts for catastrophe response which can be developed merely with the confidant cognition of the authorities and NGOs.

Forecast modeling:

One of the tried simulation theoretical accounts for the intent of calculating the Tsunami is the Method of Splitting Tsunami ( MOST ) developed by Titov of PMEL and Synolakis of University of Southern California is the current criterion theoretical account used at the National Oceanic and Atmospheric Administration ( NOAA ) Centre for Tsunami Research [ NCTR ] . This theoretical account is capable of imitating three procedures of Tsunami development: temblor, transoceanic extension and flood of dry land.

The chief aim of a prognosis theoretical account is to supply an estimation of moving ridge reaching clip, beckon tallness and flood country instantly after a Tsunami event. Tsunami prognosis theoretical accounts are run on the handiness of existent clip informations under unsure state of affairss.

Tracking and following of supplies:

Relief Logisticians must secure and track supplies from entreaty to bringing phase of the supply concatenation guaranting all the relevant fiscal information and motion of goods along the alleviation grapevine. Despite their function in supplying alleviation to donees, logicians are seldom incorporated in the purchase and development of information engineering solutions associating to relief operations ( Lee & A ; Zbinden, 2003 ) .

To incorporate all the maps across the alleviation concatenation and to progress the information engineering, Fritz Institute along with the International Federation of the Red Cross ( IFRC ) has developed Human-centered Logistics Software ( HLS ) in order to turn to many lacks present in the current logistics systems. Based on the analysis performed on the logistics systems used taking NGOs, the following IT package ‘s could be integrated into the Human-centered Supply Chain in order to accomplish the best consequence from entreaty to bringing phase of the alleviation concatenation.

SUMA ( Human-centered Supply Management System ) / PAHO

Microsoft- FACTS ( Save the Children/ Mercy Corps )

Commodity Tracking Systems CTS2000 ( World Vision )

CTS ( Save the Children )

Purchase Plus PALMAS ( Oxfam/ IRC )

Log 6.5 ( Medecins Sans Frontieres )

Catastrophe Preparedness and Response Modelling:

Catastrophe readiness and response modeling consists of four countries:

1 ) Supply Chain theoretical account

2 ) Point of Distribution ( POD ) theoretical account

3 ) Demand theoretical account

4 ) Catastrophe theoretical account

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

The Supply Chain Model describes the flow of alleviation supplies from Human-centered Organisations to Distribution Centres ( DCs ) , to local authoritiess and eventually to the Points of Distribution ( POD ) . The POD distribution theoretical account describes about the distribution of alleviation supplies to victims who gather at POD to have supplies. The demand theoretical account describes the happening of catastrophe victims necessitating alleviation supplies with regard to clip and location. Finally, the catastrophe theoretical account describes the reaching and patterned advance of catastrophes with regard to clip and location.

The catastrophe theoretical account affects and influences the figure of victims ( the demand theoretical account ) , activation of supply concatenation nodes and transit ( the supply concatenation theoretical account ) and the efficiency of POD operations ( POD distribution theoretical account ) . All these theoretical accounts contribute to the impact of catastrophes and represent the overall effectivity of catastrophe readiness and response programs and operations.

The catastrophe response patterning model consists of two parts:

1 ) Simulation

2 ) Optimization

Simulation theoretical account is developed to understand the inauspicious impact of catastrophes, catastrophe response operations and the consequences of the alternate policies of readiness and response.

Analytic theoretical accounts are developed to optimize the alleviation supply concatenation and distribution operations.

Development of Analytic Models for Transporting Relief Supplies to Pod:

In most catastrophe scenarios ( including Tsunami ) , catastrophe alleviation supplies would make different PODs at different velocity and with changing measures. In order to cut down the instability between the demand and supply and better the effectivity of distribution, two analytical theoretical accounts have been developed:

1 ) Optimal Dispatching Model

This theoretical account describes the best finish POD for each cargo from the local part.

2 ) Optimal Cross transportation ( Leveling ) Model:

This theoretical account determines the most effectual cross levelling cargos ( clip of ship, inception POD, and finish PODs and cross levelling measure ) by sing prognosis of awaited victims in each POD, on-hand stock list, in-transit stock list to PODs, handiness and capacity of cross transportation trucks, theodolite clip, minimal cargo size for cross transportation and frequence of cross levelling etc. This theoretical account is really effectual when the local country is located far off from POD finish.

Role of RFID in Humanitarian Supply Chain:

Radio Frequency Identification ( RFID ) ticket and readers plays an of import function in tracking the catastrophe alleviation supplies sent from Human-centered Organisations to Distribution Centres ( DCs ) , to local authoritiess and eventually to the Points of Distribution ( POD ) . It helps in optimizing the procedure of effectual direction of stock assets.

Hence with the execution of appropriate simulation theoretical accounts and IT technologies to the Tsunami catastrophe alleviation operation, optimization of alleviation supply concatenation response would be really effectual.

7.0 Push and Pull Strategy in a Human-centered Supply Chain:

In a commercial push supply concatenation, production and distribution determinations are made on long term prognosiss and the maker uses orders received from the retail merchants ‘ warehouses to calculate the demand.

In a pull scheme, true client demand drives the production and distribution instead than prognosiss.

In the context of Human-centered Supply Chain, with unsure demand state of affairss, it is hard to calculate demand on a long term footing based on historical informations and would take instability between the demand and supply.

With the pull scheme in topographic point, demand prognosis would be based on existent clip informations and there would be decrease in the stock list costs, addition in service degrees and decreased bull whip consequence. However, as clip is a critical factor in a Human-centered Supply Chain, pull scheme interruptions down when lead clip becomes excessively long to respond to the unpredictable demand.

These built-in strengths and failings of these two schemes have led to the proposal new Hybrid Push-Pull scheme that takes advantage of the best of each while get the better ofing their several drawbacks. In this Human-centered Supply Chain, the initial phases would follow the Push scheme while the staying phases would follow the Pull scheme. The interface between the two phases is by and large called Push-Pull boundary. Execution of intercrossed scheme would optimize the stock list direction and the supply concatenation response along the grapevine of the alleviation supply concatenation.

Aboard this scheme, decentralization, pre-positioning and pooling of alleviation points are cardinal success factors for dramatic betterments in Human-centered operations public presentation in catastrophe response and recovery.

8.0 Corporate Social Responsibility ( CSR ) in a Human-centered Supply Chain:

CSR is about capturing the whole set of values, issues and processes that companies must turn to in order to minimise any injury ensuing from their activities and to make economic ( net income ) , societal ( people ) , and environmental ( planet ) value.

CSR is really of import as it is straight linked with micro, meso and macro factors and adds touchable and intangible value to the Organisation. It besides offers sustainable competitory advantage to all the stakeholders. As more unethical patterns take topographic point in the human-centered supply concatenation compared to commercial supply concatenation, rigorous conformity with the ordinances is required by all the participants. With the proper execution of appropriate scheme and simulation theoretical accounts along the grapevine of alleviation concatenation procedure, Corporate Social Responsibility ( CSR ) would be optimised efficaciously.

9.0 Decision:

Many Human-centered Administrations realised the importance of logistics that played during the result of Tsunami. Human-centered Organisations besides realised the value of using incorporate engineering systems to capture and analyze information ensuing in a more effectual and efficient alleviation attempt. Besides, the analysis of Tsunami Relief Chain procedure shows that the issues faced by Human-centered Administrations are chiefly common and non influenced by Organisational size. The analysis besides mentioned that alleviation attempts need more attending on the undermentioned countries: Appraisal, coaction, human resources and supply concatenation analysis. The analysis of this instance survey besides mentions about the execution of schemes and simulation package in order to optimize the Relief Supply Chain response and to incorporate, organize, collaborate and communicate between all the maps of the alleviation concatenation.

10.0 Recommendations:

Based on the IT simulation package discussed and used by many Administrations including NGOs in the Commercial Supply Chain market could be good used in the Human-centered Supply Chain every bit good. Human-centered Logistics Software ( HLS ) needs trained logicians and is really dearly-won to implement at an early phase. However the complete benefit can be obtained once it is exhaustively implemented and integrates all the maps along the grapevine of the Relief Supply Chain. Second, execution of Hybrid Push-Pull Supply Chain scheme would profit trailing and tracing, stock list direction and distribution of alleviation points.

11.0 Glossary:

SC- Supply Chain

CSR- Corporate Social Responsibility

NGO- Non-Governmental Administration

DC- Distribution Centre

POD- Point of Distribution

MOST- Method of Splitting Tsunami

NOAA- National Oceanic and Atmospheric Administration

NCTR- N ( NOAA ) Centre for Tsunami Research

IFRC- International Federation of the Red Cross

HLS- Human-centered Logistics Software

SUMA- Humanitarian Supply Management System

PAHO- Pan American Health Organisation

CTS- Commodity Tracking System

i-DRuM- IBM ‘s Disaster Response simulation Model

IT- Information Technology

RFID- Radio Frequency Identification


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