Bachelor Thesis, 2015
27 Pages, Grade: 1,0
2. Humanitarian Logistics
3. Differences between Humanitarian Logistics and Commercial Logistics
3.1. Determining the Purpose of Humanitarian Logistics and commercial Logistics
3.2. The issue of standardizing processes
3.3. Unpredictable demand
3.5. Performance Measurement
4.2.1. Limitation of Information Technology
5. Application of the Theoretical Knowledge to South-East Asian
5.1. Preparation for the Indian Ocean Tsunami in
5.2. Phase of Immediate Response
5.2.1. Actors in the Phase of Immediate Response
5.2.2. Cooperation and Coordination in the Phase of Immediate Response
5.2.3. Other Issues in the Phase of Immediate Response
5.3. Phase of Reconstruction
5.3.1. Resource Availability in the Phase of Reconstruction
5.4. Improvements after the Indian Ocean Tsunami
This paper investigates the theory of humanitarian logistics and in further consequence the disaster relief operation during the tsunami catastrophe in South-East Asia 2004.
The objective of the paper is to define the differences between commercial logistics and humanitarian logistics and to analyze the efficiency of the disaster relief operation in South-East Asia 2004.
The first part of this paper focuses on theoretical implications and deals, among others, with the definition of humanitarian logistics. Further, the differences of humanitarian logistics and commercial logistics will be analyzed based on the previous discussed definition. Moreover, the different objectives of humanitarian logistics and commercial logistics as well as the challenges of cooperation and coordination based on the high number of actors involved need to be emphasized.
Part 2 of this paper analyzes the disaster relief operation in the crisis region of South-East Asia. In order to do so, the disaster relief response and its potential for improvement will be segmented and analyzed in three phases consisting of preparation, immediate response and reconstruction. Insufficiencies of every phase will be explained. While researching for this paper it became obvious that the risk of a tsunami was neglected in terms of preparation. During the phase of immediate response, deficiencies concerning cooperation and coordination led to insufficiencies in the disaster relief operation. The phase of reconstruction focuses on tsunami-specific challenges. The main developments in the South-East Asian region since the tsunami-catastrophe in 2004 will be mentioned.
The key words of this paper are: humanitarian logistics, commercial logistics, disaster management, South-East Asia 2004, preparation for the tsunami in 2004, coordination in disaster relief operations and resource availability during tsunami 2004.
Die vorliegende Bakkalaureatsarbeit befasst sich mit humanitärer Logistik in der Theorie und in weiterer Folge mit dem humanitären Hilfseinsatz, welcher im Zuge der Tsunamikatastrophe in Südostasien stattgefunden hat.
Die Zielsetzung der Arbeit ist es, die Unterschiede zwischen kommerzieller und humanitärer Logistik zu definieren und den humanitären Hilfseinsatz in Südostasien bezüglich Effektivität zu analysieren.
Teil 1 der Bakkalaureatsarbeit besteht aus relevanter Theorie und befasst sich unter anderem mit der Definition von humanitärer Logistik. Darauf aufbauend werden die Unterschiede von Humanitärer Logistik und kommerzieller Logistik analysiert. Besonders hervorzuheben hierbei sind die unterschiedliche Zielsetzung sowie die Schwierigkeiten der Kooperation und Koordination aufgrund der Vielzahl an Beteiligten bei humanitären Einsätzen.
Der 2. Teil der Bakkalaureatsarbeit befasst sich mit einer Analyse des humanitären Einsatzes im Krisengebiet Südostasien. Hierbei werden der Hilfseinsatz und dessen Verbesserungspotenzial in drei Phasen, bestehend aus Vorbereitung, Sofortreaktion und Wiederaufbau, durchleuchtet. Unzulänglichkeiten in jeder Phase werden hervorgehoben und begründet. In der Phase der Vorbereitung ist offensichtlich, dass die Risiken einer Tsunamikatastrophe unterschätz wurden. Während der Sofortreaktion sorgten Mängel in der Kooperation und Koordination dafür, dass die Effizienz des Hilfseinsatzes mangelhaft war. Für die Phase des Wiederaufbaus werden verschiedene, Tsunami-spezifische Schwierigkeiten analysiert. Abschließend wird die Weiterentwicklung seit der Tsunamikatastrophe 2004 thematisiert.
Schlüsselwörter dieser Arbeit sind: humanitäre Logistik, kommerzielle Logistik, Katastrophen Management, Südostasien 2004, Vorbereitung für Tsunami 2004, Koordination bei Katastropheneinsätzen und Ressourcenverfügbarkeit während Tsunami 2004.
If earthquakes, floods, avalanches, tsunamis or civil wars, catastrophes often have radical consequences for people living in the affected areas. Due to the constant increase of natural and manmade disasters, attention for disaster relief operations has become noticeable.
In the past 30 years the average number of natural disasters has risen from 125 up to approximately 500 per annum. Experts’ state that the number of natural and human-made disasters will increase fivefold within the next 50 years; hence the need for efficient disaster relief operations is inevitable. (Maon, Lindgreen, & Vanhamme, 2009)
Rapid urbanization and environmental degradation are two of the main causes for the fact that the Asian region accounts for 89 percent of people affected by natural catastrophes. Between 1993 and 2003 disasters had a direct impact for approximately two billion people worldwide. (Perry, 2007)
The large number of people affected shows the importance of humanitarian aid agencies. In the case of a catastrophe the speed of humanitarian aid depends on the logistician’s ability to establish a supply chain and deliver essential goods to troubled regions in the shortest time possible. (Kovács & Spens, 2007)
Effectiveness and efficiency in supplying medicines and goods necessary for survival is essential in the event of a disaster. Several statistics prove the central position of logistics in disaster operations by stating that logistics efforts account for 80 percent of disaster relief costs. (Abidi, de Leeuw, & Klumpp, 2014)
Although logistics is a significant expense factor in disaster relief operations, its importance was undervalued for many years. Since the tsunami hit South-East Asia in 2004 the attention for adequate logistics in humanitarian aid operations has increased. (Kovács & Spens, 2007)
The term “humanitarian logistics” allows a broad interpretation; therefore experts determined several different definitions. An applicable approach is to consider humanitarian logistics as a process to mobilise people, resources, skills and knowledge with the aim to help those affected by a disaster.
(Whiting & Ayala-Öström, 2009)
A more detailed description was made by Thomas and Mizushima (2005) by stating that humanitarian logistics is “the process of planning, implementing and controlling the efficient, cost-effective flow and storage of goods and materials, as well as related information, from point of origin to point of consumption for the purpose of meeting the end beneficiary´s requirements”.
According to Chandes and Paché (2010) humanitarian logistics combines service and manufacturing. On one site the support of aid workers with the aim to optimize the delivery process for lifesaving goods can be assigned to service. On the other side the optimization of the delivery process requires a great deal of capabilities such as material and technological resources for transport- or warehousing activities. Therefore, humanitarian logistics also includes a manufacturing component.
By comparing humanitarian logistics with business logistics similarities in the basic principles are identifiable. Managing the flow of goods, information and finances from a specific source to the final customer is applicable for both types. In addition, various activities included in commercial logistics such as planning and procurement or transporting and warehousing remain in its ultimate elements also valid for humanitarian logistics. (Kovács & Spens, 2007)
To recap the statement above, one can determine that some similarities between both kinds of logistics exist. Nevertheless, by considering the basic principles more detailed, the list of differences is more comprehensive and will be discussed in the following.
When dealing with a catastrophe, logisticians in the humanitarian field need to be aware of several different challenges that basically do not exist in a commercial context.
Most of the time, crises have negative impacts on the infrastructure of the affected region. Based on the infrastructural issues, chaotic circumstances arise. Furthermore, high cooperative efforts as well as sudden and instable demands keep logisticians busy.
Due to these and many other characteristics, the main purpose of humanitarian logistics differs from its commercial counterpart.
Defining the main purpose of both kinds of logistics leads to an understanding for the difference between humanitarian logistics and commercial logistics.
Deciding therefore is the importance of profitability. Langley and Rutner (2000) mentioned in their work about commercial logistics that the value of logistics lies in “the contribution to profitability”. Therefore, the focus concerning business logistics is on cost reduction while the main purpose for logisticians in the humanitarian context is to ensure aid for people located in crisis regions.
As an example: Reacting as quickly as possible to a disaster often requires the use of airplanes but aerial transportation causes high costs. Thus, cost reduction plays a subordinated role in the phase of immediate response. (Baumgartner & Blome, 2014)
The term “profit” in a humanitarian context is directly linked to agencies benefactor´s; inefficient use of resources may lead to losses of donations, hence the profit depends on a donor’s satisfaction. To secure a high efficiency, an approach to standardize processes would be helpful. (Chandes & Paché, 2010)
Standardized processes are one of the key elements for many companies to achieve success therefore the desire to standardize processes for humanitarian logistics is obvious.
The fact that the dimension and the geographical area differ from disaster to disaster makes standardizing procedures in humanitarian logistics complicated. Moreover, humanitarian agencies have to employ their disaster relief systems in chaotic, uncertain environments with short lead times. (Fawcett & Fawcett, 2013)
To establish action rules in terms of emergency response implicit and explicit knowledge should be collected from situations already experienced in crises regions. Due to a high turnover of logisticians in the humanitarian context, a loss of experience whenever a logistician leaves is unavoidable. In addition, it is difficult to translate experiences made in one geographical area for decision makers in another geographical area. (Chandes & Paché, 2010)
Furthermore, many experts share the opinion that the constantly changing operational environment of humanitarian aid makes a complete standardization of processes impossible. (Chandes & Paché, 2010)
Unpredictability of demand is ascribed to the fact that a great number of disasters are unforeseeable. The uncertainty in estimating when, where and to what extent a disaster occurs is a challenging factor for logisticians in disaster relief operations. (Kovács & Spens, 2007)
In the aftermath of a catastrophe a sudden occurrence of demand in large amounts emerges. (Kovacs & Spens, 2009) An increase in demand in turn requires an exceptional use of resources, but resources are limited by nature, therefore shortages, especially in complex disaster projects, arise. (Chang, Wilkinson, Potangaroa, & Seville, 2012)
To avoid such shortages, resources must be utilised as efficient as possible. Nevertheless, an anticipation of the exact demand is impossible; hence reaching total efficiency is excludable. (Scholten, Sharkey, & Fynes, 2010)
In order to be able to reduce the importance of an exact demand-anticipation successfully, organisations started to preposition resources. More precise, these resources are traceable in regions more prone to be affected by a natural or manmade catastrophe. (Kovács & Spens, 2007)
In general, disaster relief operations of humanitarian agencies follow the same procedure: At the beginning the focus is on establishing and optimizing the delivery process for the first urgent emergency care. Subsequently, rebuilding the destroyed infrastructure to guarantee a sustainable supply becomes more important. (Chandes & Paché, 2010)
Within the disaster-affected region, aid agencies need to be prepared for the worst: Bridges and air fields are potentially destroyed and hinder an adequate supply. Furthermore, a possibly damaged electricity network would have a negative impact on the communication infrastructure. (Kovacs & Spens, 2009)
If the communication infrastructure does not allow a permanent transfer of information, route planning becomes very challenging for logisticians. (Kovacs & Spens, 2009) In extreme situations, supplying goods by land is not possible. As a last resort, humanitarian aid agencies can make use of aircrafts to airdrop supplies. (Kovács & Spens, 2007)
Another issue in terms of infrastructure is the problem of the last mile. For instance, due to a destabilized infrastructure including limited power supplies, an appropriate temperature control for medicines can sometimes not be ensured. (Kovács & Spens, 2007)
A general belief in terms of efficiency and effectiveness is that companies, which apply performance measurement, outperform those that do not. Thus, measuring performance is crucial for an efficient and effective management of the humanitarian supply chain. (Abidi, de Leeuw, & Klumpp, 2014)
The function of performance measurement lies in the quantification of the efficiency and effectiveness of an operation. Therefore, specific indicators, such as capacity utilization, get determined. (Abidi, de Leeuw, & Klumpp, 2014)
Although measuring the performance brings advantages such as a simplification of the communication between supply chain actors, many humanitarian aid agencies fail to implement convincing key figures. For instance, an important part of humanitarian aid is to reduce suffering, but quantifying a relation between supply chain performance and alleviation of suffering is highly complex. (Abidi, de Leeuw, & Klumpp, 2014)
In addition, logisticians have to deal with various critical elements that complicate the measurement of performance in humanitarian supply chains. Among others, humanitarian aid agencies operate in a chaotic environment with a limited information technology capacity and infrastructure. Therefore, reliable data collection is problematic. (Abidi, de Leeuw, & Klumpp, 2014)
Evidence, that a general lack of motivation to measure performance in the non-profit sector exists, is shown in research: Only 20 per cent of the humanitarian organisations measure performance consistently while 55 per cent do not monitor and report performance measurement indicators at all. The remaining 25 per cent of the humanitarian aid agencies only use a few indicators. (Abidi, de Leeuw, & Klumpp, 2014)
Regarding performance measurement, development potential is given. Humanitarian organisations need to increase their research efforts in this respect to ensure continuous performance-improvement in disaster relief operations.
One special characteristic of humanitarian logistics is the broad range of actors participating in disaster relief operations. Principally, actors involved are: governments, international and national donors, international and regional organisations, international and national non-governmental organisations, police and armed forces, logistics service providers and the local population. (Sheppard, Tatham, Fisher, & Gapp, 2013)
In general, these different actors have the common goal to alleviate the suffering of vulnerable people. However, every actor has its own approach on how to reach this aim. Different approaches on how to reach a common goal, in turn, hamper humanitarian aid immense. (Kovács & Spens, 2007)
A major problem that hinders the achievement of a better cooperation between humanitarian aid agencies is the constant expansion within the humanitarian sector. The high number of humanitarian organisations either leads to a competition environment for scarce donor resources rather than it leads to a performance improvement. (Abidi, de Leeuw, & Klumpp, 2014)
As a solution for this dilemma, experts suggest a more collaborative approach in terms of emergency response. Concerning shared equipment, assets or resources, collaboration among agencies improved in recent years, nevertheless, a lack of communication is still remaining. Often communication based problems arise before a disaster occurs since humanitarian organisations usually do not share information about available capabilities. (Maon, Lindgreen, & Vanhamme, 2009)
Fawcett and Fawcett (2013) assign the unwillingness of aid agencies to share information to the human nature by stating that “people perceive information as a source of power and legitimacy. As a result, they may be unwilling to share information that empowers others to their own potential detriment.” With other words, the quest for limited resources in combination with the possibility to establish relationships to acquire them, leads to counterproductive information-sharing behaviour.
Beside an existing lack of cooperation, insufficient coordination due to the high number of actors is trigging the overall success of a disaster relief operation. Estimations state, that 30.000 non-governmental organisations exist. (Tatham & Pettit, 2010) The fact that these organisations tend to manage their own created supply chains, which they developed over many years, makes a coordination of materials and human resources between organisations highly challenging.(Chandes & Paché, 2010)
The problem-solving approach regarding coordination lays in the development and expansion of collaborative information technology tools. However, a lack of considering the importance for supply chain management in disaster relief operations combined with the action-focused cultures of aid agencies hinder the development of information systems, information technology and logistics systems. (Maon, Lindgreen, & Vanhamme, 2009)
Synchronisation of processes is very difficult due to discrepancies about appropriate processes among humanitarian agencies. As a result, regular planning in disaster relief supply chains is frequently lacking. For instance, central data bases that include information about transit times, prices paid or quantities purchased and received, do often not exist.(Maon, Lindgreen, & Vanhamme, 2009)
In recent years constitutions, such as the United Nations Joint Logistics Centre, have realised the importance of information technology in emergency aid by providing a common information platform. This platform supports organisations in terms of gathering, collating, analysing and disseminating logistics information in the phase before a disaster occurs.(Whiting & Ayala-Öström, 2009)
There is another indicator for a positive development concerning information technology systems in the humanitarian sector. Aid agencies started to create specialized common systems that contain information such as tracking and tracing. These systems are opened up for the use by other organisations. (Kovács & Spens, 2011)
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