Investing in disaster management capabilities versus pre-positioning inventory: A new approach to disaster preparedness
2014-11-11, Kunz, Nathan, Reiner, Gerald, Gold, Stefan
Disaster preparedness has been recognized as a central element in reducing the impact of disasters worldwide. The usual methods of preparedness, such as pre-positioning relief inventory in countries prone to disasters, are problematic because they require high investment in various locations, due to the uncertainty about the timing and location of the next disaster. Investing in disaster management capabilities, such as training staff, pre-negotiating customs agreements with countries prone to disasters, or harmonizing import procedures with local customs clearance procedures, has been recognized as a way to overcome this constraint. By means of system dynamics modeling, we model the delivery process of ready-to-use therapeutic food items during the immediate response phase of a disaster, and we analyze the performance of different preparedness scenarios. We find that pre-positioning inventory produces positive results for the beneficiaries, but at extremely high costs. Investing in disaster management capabilities is an interesting alternative, as it allows lead time reductions of up to 67% (18 days) compared to a scenario without preparedness, at significantly lower costs than pre-positioning inventory. We find that the best performance can be achieved when combining both preparedness strategies, allocating part of the available funding to disaster management capabilities and part to pre-positioning inventory. We analyze 2828 such combined scenarios to identify the best mix of preparedness strategies for different levels of available funding. On the basis of our findings, we provide recommendations for relief organizations on how to allocate their preparedness budget.
Relief aid, yes, but
2013-5-4, Kunz, Nathan, Reiner, Gerald
Empirical evidence shows that some governments increasingly hinder relief organizations from operating in their territory. Through a case study, we analyze problems encountered by four organizations. We find that state fragility explains the tendency of governments to restrict relief organizations’ activities. This study helps organizations in their efforts towards preparedness.
A meta-analysis of humanitarian logistics research
2012-9-19, Kunz, Nathan, Reiner, Gerald
Purpose - This paper gives an up-to-date and structured insight into the most recent literature on hu-manitarian logistics, and suggests trends for future research based on the gaps identified through structured content analysis. Design/methodology/approach - We use a quantitative and qualitative content analysis process to analyse the characteristics of the existing literature. We identify the most studied topics in six structural dimensions, and present gaps and recommendations for further research. Findings - We found that existing humanitarian logistics research shows too little interest in continuous humanitarian aid operations, in slow onset disasters and man-made catastrophes. While several papers address different phases of disasters, very few focus particularly on the reconstruction following a disaster. Empirical research is underrepresented in the existing literature as well. Research limitations/implications - While five of our structural dimensions are inspired by previous reviews, our sixth dimension (situational factors) is derived from a theoretical framework we developed and which has never been tested before. The validity of our study could therefore be increased by testing this framework. Originality/value - We analyse the broadest set of papers (174) ever covered in previous literature reviews on humanitarian logistics. We conduct a quantitative analysis of the papers in order to analyse the situational factors which have mostly been studied so far in literature. This paper is also the first in humanitarian logistics to use content analysis as the main methodology to analyse literature in a structured way, which is of particular value to the academic community as well as practitioners. Outstanding Paper Award 2013 winner (Emerald)
Capabilities investment versus prepositioning inventory: a new approach to disaster preparedness
2012-8-23, Kunz, Nathan, Reiner, Gerald, Gold, Stefan
Disaster preparedness has been recognized as a central element in reducing the impact of disasters worldwide. However, donors are reluctant to finance such efforts, as there is no certainty that a disaster will strike. Usual methods of preparedness, such as prepositioning of supplies in countries prone to disasters, are problematic because they require high investment costs at various locations, due to the high uncertainty about the timing and location of the next disaster. Product expiry is a major problem, as there is no inventory turnover (Whybark, 2007). Therefore, Van Wassenhove (2006) proposes relief organizations to invest in effective disaster management capabilities, such as human resources, knowledge management, process management, resources and community. Investing in such capabilities instead of physical assets has several benefits. First, in opposition to prepositioning supplies in specific locations, such capabilities acquired by the organization can be used worldwide. Second, these capabilities, in particular those related with import processes, allow organizations to deliver supplies quickly from a central warehouse in case of disaster. Finally, investments in capabilities cost less than prepositioning supplies in large quantities in many locations. In this paper, we analyze the effect of investing in these disaster management capabilities, through a system dynamics model. We model the delivery process of a therapeutic food item during the immediate response phase of a disaster. By comparing a standard import scenario with one where investments in capabilities have been made, we quantify the improvement potential of such preparation efforts (i.e., lead time and inventory reduction). We find that with capabilities investment, goods can be delivered to beneficiaries almost as fast as if supplies were prepositioned in the country, but at lower inventory costs (lower opportunity costs and physical holding costs, less product expiry and obsolescence, etc.). Transportation costs are higher, but occur only where the disaster strikes, and not in each country where inventory is prepositioned. The managerial implication of our research will encourage relief organizations to invest more into capabilities instead of prepositioned physical inventories during the preparedness phase of a disaster. Because of lower costs and risks involved, donors are encouraged to finance such pre-disaster efforts which have a strong potential to improve disaster response.