The Role of Humanitarian Logistics – Status Quo

Prof. Dr.-Ing. Bernd Noche M. Sc. Melissa Robles

1. International Workshop on Humanitarian Logistics

Fakultät für Ingenieurwissenschaften Telefon: 0203 379-2785 Abteilung Maschinenbau Telefax: 0203 379-3048 Transportsysteme und -logistik E-Mail: [email protected] Keetmanstraße 3-9 E-Mail: melissa.robles-aguirre 47058 Duisburg @uni-due.de The Role of Humanitarian Logistics – Status Quo Agenda

. Presentation of our faculty and related projects . Action field of Humanitarian Logistics (HL) . Humanitarian Logistics flows and actors . Demanding circumstances facing today´s HL . Task nowadays performed by humanitarian logisticians . HL in focus . Important projects for the development of HL (IT, Procurement, Network)

1. International Workshop on Humanitarian Logistics Essen, Oktober 11 © Noche/Robles 2 von 22 The Role of Humanitarian Logistics – Status Quo Faculty of Transport and Logistics Systems - TUL

. Education (M. Sc. Technical Logistics)

. Best Logistics University (Logistik Masters Competition 2007-2010)

. University Research Special competences:

. Logistics in Urban Systems . Technical Logistics Systems . Supply Chain Management . Simulation and Methods . Information System in Logistics . Sustainable and Green Logistics Research references:

. Efficient Cluster LogistikRuhr: Automatic Storage and Retrieve System with basis in Stewart-Gough-Platform – Stewart, Dynamic Consolidation – DynKo, Tracing Intelligent Logistics Objects – TiLO, e-Qualification for efficient Logistic Processes – eQuaL, Supply Chain Planning – SCP, Organizational Innovations with Good Governance in Logistic Networks – OrGoLo

. Other projects: ColognE-mobil, KuLaRuhr, FInest (EU: FP7, PPP)

1. International Workshop on Humanitarian Logistics Essen, Oktober 11 © Noche/Robles 3 von 22 The Role of Humanitarian Logistics – Status Quo TUL - SDZ - Reference Project

Organization: Provider of medical products & services

Project: Optimisation of site location Region Central Europe (CE)

Range of activities: . Optimization of site location in region of central Europe (CE) . More than #00.000 pallets p.a. . Consideration of market development up to 2017 . Analyses of different scenarios . Simulation results:  Quantity of distributed pallets  Total transport costs (on basis on distribution distances per relation)  Service level

1. International Workshop on Humanitarian Logistics Essen, Oktober 11 © Noche/Robles 4 von 22 The Role of Humanitarian Logistics – Status Quo TUL - SDZ - Reference Project

SIMULATION Organization: Provider of medical products & services MODEL

EMEA AP LA Project: Inventory optimization, forecast accuracy and Service-Level-Agreement (SLA)

Range of activities: . Simulation-based optimization of supply chain inventory . Inputs/Run parameters :  Demand volumes (forecast)  Master data  Forecast accuracy SCOT © Schweden Norwegen Supply Chain Optimization Tool  Production data / Frozen horizon

Dänemark  Cost data England

Deutschland Weißrussland Benelux . Outputs: Polen Tschechien Ukraine

Production Facilities Schweiz Österreich  Costs Ungarn Rumänien Frankreich Central Distribution Center Portugal Regional Distribution Center Italien  KPIs Bulgarien Affiliates Spanien Griechenland Delivery  Inventory turns  Service level

1. International Workshop on Humanitarian Logistics Essen, Oktober 11 © Noche/Robles 5 von 22 The Role of Humanitarian Logistics – Status Quo Humanitarian Logistics

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 the point of origin to the point of consumption for the purpose of alleviating the suffering of vulnerable people.” (Fritz Institute, 2005)

Disasters Development Aid Peacekeeping and Crisis Management

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Oil Fleet Monitoring HO Procurement and Evaluation Pre-positioned Stock

Donor Local HO Institution Provider Local Warehouse Victims

Financial flow Warehouse Material flow Missing & Information flow Corpse

HLS 1. International Workshop on Humanitarian Logistics Essen, Oktober 11 © Noche/Robles 7 von 22 The Role of Humanitarian Logistics – Status Quo Commercial VS Humanitarian Logistics

Commercial Supply Chain Humanitarian Supply Chain

Relatively stable Unpredictable in time, location, type Predictable demand patterns Demand Pattern and size Origin in fixed locations

Well-defined inventory levels based on Challenging due to high variations in lead time, demand and target service Inventory Control lead times, demands and locations levels

Unknown location, type and size of Precise determination of number and event, politics, culture and “last mile“ location of distribution centers Distribution factors

Damaged streets, Stable commercial conditions Conditions no communications injured people

High quality products at low cost to Goals Minimize loss of life and alleviate maximize profitability suffering

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Pre-Disaster Response Post-Disaster

Prevention & Transition & Warning Mitigation Rehabilitation

Reconstruction Preparedness Impact and Development

Emergency Response

Source: Tufinkgi, 2004

1. International Workshop on Humanitarian Logistics Essen, Oktober 11 © Noche/Robles 9 von 22 The Role of Humanitarian Logistics – Status Quo Logistics Tasks

Pre- . Mapping and evaluation of national transport infrastructure Disaster . Design of evacuation routes (capacity and potential weakness)

. Assessing potential sites for logistic bases: supply distribution centers (food, medicine, tools), fuel distribution points and shelters

. Location study and management of emergency warehouses

. Determine the capacity of ports and airports to handle emergency supplies under different scenarios

. Assessing location of secondary ports and airports

. Determining alternative transportation routes such as waterways

. Establish procedures and formalities for the arrival of emergency consignments

. Planning for deployment of vaccines in case of pandemic illness (PI)

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. Evacuation Respons Response e . Organization for the arrival of international and local shipments . Estimation of storage needs and capacities Post- Disaster . Allocation of local distribution centers and beneficiaries distribution points

. Assessing of needs (places, amount of people and needs)

. Planning of relief aid distribution networks

. Fleet management and distribution of supplies

. Deployment of vaccines, food and supplies delivery to hospitals

. Warehouse management (classification, storage and commission processes)

. Planning of systems for record keeping, control and monitoring of supplies inventory

1. International Workshop on Humanitarian Logistics Essen, Oktober 11 © Noche/Robles 11 von 22 The Role of Humanitarian Logistics – Status Quo Humanitarian Logistic in Focus

The increase in number and grade of devastation of disasters in the last years, bring into focus the importance that logistics has in the alleviation of suffering and reconstruction of societies.

For the next 50 years natural and man-made disasters will increase five-fold (Thomas and Kopzak, 2007)

World-wide estimated costs of $ 64 tr . Germany: $ 800 bn (Kemfert, 2005)

World-wide as decade’s average per year . More than 255 million people affected 224 million in 2008 . More than 110 thousand fatalities (242 thousand on 2008) (IFRC, 2010)

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Frequency

Complexity Climate change Severity Urbanization trends

Disease’s spread- speed

Aggravating Influence on Factors Disasters

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Megacities and World Population Growth per Hour

. Most of the largest cities are now in low- and middle-income nations with a very large deficit in provision for infrastructure and services for reducing disaster risk.

1. International Workshop on Humanitarian Logistics Essen, Oktober 11 © Noche/Robles 14 von 22 The Role of Humanitarian Logistics – Status Quo Expenditures in Emergency Response

Source: Global Humanitarian Assistance, 2011 . Since 2007 the amount spent on disaster prevention and preparedness (emergency contingency stocks, contingency planning, preparations for forced displacement) had increased.

1. International Workshop on Humanitarian Logistics Essen, Oktober 11 © Noche/Robles 15 von 22 The Role of Humanitarian Logistics – Status Quo Importance of Humanitarian Logistics

. Humanitarian Logistics rates are evaluated in terms of saved life rather than reduced profits. . The logistic costs of relief operations are estimated to be as high as 80 % of the total costs of disaster relief. (Van Wassenhove, 2006) . Natural disasters degrade social systems and leads to social disasters. . Increasingly demand of donors with respect to performance and impact. . HL generates information that helps to better prepare for future disasters.

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Organization and volunteer registry Increase of reaction time Missing persons registry All parties have access to Needs assessments and incident report management same information Geospatial location of relevant locations Catalog of aid supplies Understanding and transparence of operations Track of Request Orders Manage of Request of Quotations, and bids analysis Precise budgets Reception of Goods by Goods Received Notes Increase the efficiency of Internal Supply Orders transport, warehousing Cash Purchase and distribution Waybills Better control and Picking and Packing lists forecast of aid resources

1. International Workshop on Humanitarian Logistics Essen, Oktober 11 © Noche/Robles 17 von 22 The Role of Humanitarian Logistics – Status Quo Pre-positioned Stock - UNHRD

Pre-positioned stocks of United Nations Humanitarian Response Depots make possible: . First need items are delivered to affected areas within 24/48 hours . Significant transport cost reduction because of proximity to crisis potential areas . Significant procurement cost reduction thanks to agreement with suppliers to access „virtual“ and „white“ stocks at competitive prices . Increase of coordination between aid agencies that have stocks in UNHRD . Facilitates a pull rather than push system in the delivery of aid supplies

1. International Workshop on Humanitarian Logistics Essen, Oktober 11 © Noche/Robles 18 von 22 The Role of Humanitarian Logistics – Status Quo Services – UNHRD

Free of charge for Standard Services Authorized Users - Receipt of stocks at HRD - Inspection of stocks at HRD Full Cost Recovery - Storage Specific Services - Storage of drugs in refrigerated cells Direct Operating Cost - Storekeeping - Management of dangerous goods of the Service

- Minor repairs - Handling and ramp assistance for air operations + Safety Marging (10 %) - Customs procedures IN and OUT HRD - Handling of sea/land shipment - Identify suitable packaging - Procurement of noon-food items + Management - Stock reports - Procurement of transport service Recovery Fee (7 %)

- Access to HRD premises - Repackaging due to major damage - Disposal of assets - Technical assistance in the field

1. International Workshop on Humanitarian Logistics Essen, Oktober 11 © Noche/Robles 19 von 22 The Role of Humanitarian Logistics – Status Quo Evolution of Cooperation = Optimization of Logistics

Results of this evolution: In-kind donations Transport cost Local purchase Overlapping of actions Gaps in aid distribution Efficiency of capacities and resources

Donation as a Link to online-shops Donation is destinated Donation is distributed In case of international percentage of through clicks 4 charity to specific amoung members disaster planned and purchase humanitarian according to a key coordinated amoung organization (performance/range of all members relief services) operations 1. International Workshop on Humanitarian Logistics Essen, Oktober 11 © Noche/Robles 20 von x The Role of Humanitarian Logistics – Status Quo Transparency

New Approach: Victims are clients and humanitarian organizations are rated

1. Objective 4. Use of Resources 2. Management & Supervision . Defined structure and processes for planning, Donator execution and control of 3. Marketing and Public Work operations 4. Use of Resources . Marketing and Management costs < 30 % of expenses 5. Salaries . Review of the effects their operations – performance 6. Accounting & Audit indicators 7. Transparency

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Humanitarian Logistics improves timeHumanitarian and cost-effectiveness Logistics improves of relief deliverytime and insuring cost-effectiveness that donations of relief are deliverywell-spent insuring and thatsocieties donations recover are well-spentfaster and from societies disasters. recover faster from disasters.

Thank you for your Prof. Dr.-Ing. Bernd Noche kind attention! M. Sc. Melissa Robles

Telephone: 0203 379-7711 Fax: 0203 379-3048 E-Mail: [email protected] E-Mail: [email protected]