The Odd Humanitarian Procurement’s Power to Reshape the Sector
Last week, I attended the opening of the HSC, the Humanitarian Studies Centre. A new institute hosted at the ISS (the International Institute of Social Science in the Hague, Erasmus University). Headed (and made possible) by Prof. Thea Hilhorst after she was awarded the Spinoza price of NWO in 2022 As I am a member of one of the institutions (IHSA – the International Humanitarian Studies Association) hosted at the HSC, I received an email call for speakers earlier this summer. To which I responded. Hence I was delighted to shed my light on the opportunity for Humanitarian Studies to shift focus and attention to an enabler to reshape our sector. This article reflects my talk. My call to reshape and shed light on the ability to bridge the humanitarian funding gap and reshare our sector; today.
Starting with a special milestone
I started my talk with my excitement, sharing a special milestone. As of the day of the opening of HSC, it was precisely 25 years ago, on August 31st, 1998, I took my first steps into the world of academics at the University of Wageningen. That day, I began my studies in Tropical Landuse. Little did I know that my academic journey would soon intersect with the world of humanitarian assistance, forever changing my perspective.
In the early 2000s, during my university years, I encountered Professor Thea Hilhorst. She introduced me to the principles of humanitarian assistance. This introduction transformed me from an idealist into a realistic idealist. Throughout this time, I became convinced that at our core, we humanitarians are united by our realism in addressing the world’s challenges. I even argue against the pessimism versus optimism viewpoints in humanitarianism of speakers earlier throughout the day, but that’s a different story.
The size of humanitarian budgets says it all
Fast forward to today, as I stood at HSC in front of you to discuss a pressing issue in the humanitarian sector. The financial landscape has undergone a seismic shift, with humanitarian budgets ballooning from $1.9 billion in 2000 (source: Financial Tracking System of UNOCHA) to a staggering $55 billion in 2023. This surge calls for a moral responsibility to spend these funds efficiently and maximise their impact. Surprisingly, an astonishing 65% of humanitarian budgets are allocated to procurement activities (Moshtari et al. 2021). Could you let that sink in for a moment? 65% of any humanitarian response, or as more recently calculated, 74% of humanitarian budgets, are spent in Humanitarian Supply Chains (Stumpf et al. 2023).
Humanitarian procurement as strategic function
Procurement, often seen as a support function, merits a shift in perspective. It should be considered a strategic and critical component within humanitarian organizations. Reflecting on the “do no harm” principle that Mary Anderson’s book introduced in 1999, we can extend its application to how we allocate funds. For instance, purchasing supplies from local sources instead of relying on imports can nurture and strengthen local economies (instead of harming or even destroying them), it can simultaneously foster resilience and sustainable growth (note added: more about my vision on local procurement here).
As we delve into the Sustainable Development Goals (SDGs), we find that procurement is vital in their achievement. SDG 5, promoting gender equality, could benefit from procurement practices that empower women-owned companies or those committed to gender balance. Similarly, SDG 8, which focuses on decent work and economic growth, aligns with the idea that responsible procurement can stimulate local economies, enhancing self-sufficiency while minimising harm. Furthermore, SDG 13, addressing climate action, resonates with the greening of humanitarian responses, the Green Deal and more strategic, funding or policy objectives. However, our impact remains limited at best, harmful more often if we don’t consider critical technical specifications (such as the repairability of solar lanterns or toxicity of materials) in our procurement processes.
Amid all these reflections, it’s essential to emphasise the Grand Bargain, an agreement familiar to many in the humanitarian sector. While it may seem elusive, by adjusting our resource allocation, our procurement strategies make it achievable. By rethinking our procurement approach, we can contribute to the Grand Bargain’s objectives of localisation as well as our efficiency and effectiveness.
Untapped potential, procurement's power and a paradigm shift
The humanitarian sector, often referred to as an industry, carries a mission rather than a business case. Unlike the corporate world, we aim to maximize impact, not profits. This mission extends to our donors and funders, who seek to channel their resources in the most efficient way possible to help those in need. Procurement stands as a critical gateway to realizing this mission.
In conclusion, the time has come to embrace a paradigm shift in how we perceive and implement procurement in the humanitarian sector. It offers a unique and often overlooked opportunity to create massive impact immediately. Let us rise to the challenge, explore untapped potential, and, with a sense of moral responsibility, make every dollar count towards a more efficient, effective, and compassionate humanitarian response.
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Whats next?
I did not go into details about what is next during this presentation and hence also no in this article. I will write about this in a future article on this blog.
I can only restate a call from van Wassenhoven (2006) as he wrote many years ago: “top management [edit: is] to recognise the value of SCM [edit: Supply Chain Management] for operational success and involve supply chain staff in strategic decision-making processes”.
Our humanitarian logisticians, supply chain heroes and procurement departments can’t do this alone. Not only logistics scholars but also other humanitarian scholars should embrace, and explore this subject: to inform our humanitarian decision-makers and donors.
Most and foremost, I would argue that it’s time for donors and funders to make logistics and supply chain a cross-cutting theme in our proposals. And while we are at it, fundamentally change our reporting and KPI’s (more on this later).
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