The Supply Chain of the Future – Tomorrow's Vision or Today's Reality?
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Carly Fiorina, the former CEO of Hewlett-Packard, raised an interesting idea when she suggested that governments could turn to business supply chains as models for how to react to disasters or coordinate efforts to thwart terrorist threats.
Fiorina made that observation in her keynote address at CSCMP's 2007 Annual Conference in Philadelphia in October.
Government taking cues from business is not a new concept; in a review of humanitarian supply chains by the Massachusetts Institute of Technology Center for Transportation and Logistics last year, researchers Edgar E. Blanco and Jarrod Goentzel uncovered a substantial amount of literature on that topic.
Indeed, public-private collaboration is the focus of serious academic study. One example is INSEAD's Research Group on Business can also learn from the supply chain practices of humanitarian organizations.
Humanitarian Operations, which is developing a science of humanitarian logistics. That effort currently focuses on disaster-preparedness, response coordination, and collaboration among sectors like the military and private aid groups.
In a Journal of the Operational Research Society article, Luk N. Van Wassenhove, a professor at the French campus of the graduate business school, writes that private-sector logistics expertise can help improve logistics performance during a disaster.
That certainly fits with one of the most important issues facing supply chain leaders today: how to build resiliency into business supply chains. It's a concern that harkens back to the words of Scottish poet Robert Burns: The best-laid plans oft go awry.
In the case of natural disasters, things have already gone seriously awry. Blanco and Goentzel estimate that in 2005 alone, natural disasters led to more than 91,000 deaths, affected more than 157 million people, and caused more than $150 billion in economic damage. Bringing aid to those affected is a monumental task.
Fortunately, collaboration on humanitarian supply chains is not just a topic for academic research. A number of organizations dedicated to developing collaborative responses to disasters have emerged in recent years. In the United States, for instance, there is the American Logistics Aid Network (ALAN), an organization of education and trade groups that is finding ways businesses can work with relief organizations. The Fritz Institute is another that works with governments, nonprofits, and corporations to develop strategies for disaster response and recovery.
Efforts by groups like the Fritz Institute and ALAN, together with private businesses' contributions of expertise, goods, and logistics services, have already helped governments and aid agencies improve the way they deliver relief supplies. But private industry does not have a lock on expertise. Van Wassenhove asserts that business can also learn from the supply chain practices of humanitarian organizations, which must of necessity be agile and adaptable. He urges closer collaboration among for-profit companies, aid groups, and academics to develop more effective supply chains for all.
Doing good, that is, may prove good for business.
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