Localisation in Humanitarian Supply Chains: A Vision for 2050
This blog reflects my keynotes (my vision for aid in 2050, focusing on localisation in humanitarian supply chains). and the talk I provided at the POMS HOCM mini-conference, on the 25th of April 2024, in Minneapolis (which I attended online). I am thankful to Harwin de Vries, who invited me to provide a talk.
Setting the Scene: My Journey in Humanitarianism
Allow me to introduce myself: I’m Claire Barnhoorn, the CEO and founder of Solvoz. My career in humanitarian assistance spans almost 25 years. The field first captivated me during a university lecture by Thea Hilhorst (who later became a professor). This fascination led me to graduate from Wageningen. Pursuing further studies with the Erasmus Mundus Humanitarian Assistance master of DG ECHO in Dublin. My background is deeply rooted in the operational and principled aspects of humanitarian aid. Particularly from my experiences with Médecins Sans Frontières (MSF). Today, I stand before you to discuss the future of humanitarian operations, reflecting on the past 25 years and envisioning the next 25.
The Scale of Humanitarian Efforts and the Role of Supply Chains
Reflecting on the past, we see a massive expansion in the scale of humanitarian efforts. In 1999, the humanitarian budget tracked by OCHA was $286 million; last year, it ballooned to $55 billion. Today, over 10 million non-profits operate globally, forming the fifth-largest economy in the world. Despite this growth, the logistics and supply chains, which account for over two-thirds of humanitarian budgets, have often been sidelined in discussions about localisation and efficiency. It’s only recently, particularly post-COVID, that local procurement has gained more attention.
localisation in humanitarian supply chains and Procurement: Shifting Paradigms
Localisation is not just about procurement; it’s about sourcing and strengthening local capacities. The Grand Bargain in Istanbul eight years ago highlighted localisation. But we need more than statements. NGOs and humanitarian actors often struggle to maintain extensive supplier lists with limited resources. Procurement should not be seen merely as a compliance activity but as a strategic, operational decision. We need to ask ourselves if we are willing to accept higher upfront costs for longer-lasting, sustainable products. Such decisions require a shift in mindset, moving from short-term savings to long-term value and sustainability.
Tactical Procurement: A Systematic Approach
Addressing procurement challenges requires a systematic approach to tactical procurement. After years of ad-hoc solutions and pre-positioning strategies, it’s time to integrate tactical procurement into our standard practices. This involves a thorough analysis of procurement needs. A clear understanding of local market capabilities. And strategic alignment with broader organisational goals.
Tactical procurement involves not just the immediate acquisition of goods and services. But also the anticipation of future needs and the development of strategic partnerships with local suppliers. It requires a shift from reactive procurement practices to proactive planning. Ensuring that procurement decisions are made with a long-term perspective. By incorporating tactical procurement into our operations, we can better manage risks, optimise supply chain efficiency and enhance the resilience of our humanitarian response. This systematic approach also involves continuous monitoring and evaluation. Allowing for adjustments and improvements based on real-time data and feedback. It’s about creating a procurement ecosystem that is agile, adaptable and capable of meeting the dynamic needs of humanitarian operations.
Procurement professionals in the humanitarian sector are heroes. Juggling extensive responsibilities without the resources their corporate counterparts enjoy. Supporting them with better systems and strategic frameworks will enhance efficiency and effectiveness. Ensuring supply chains are robust and responsive to needs. This support includes training and capacity building, access to technology and data analytics. As well as fostering a culture of collaboration and innovation within procurement teams.
Looking Ahead: Procurement as a Catalyst for Change
Procurement holds the potential to reshape the humanitarian sector profoundly. Moving from a support function to a strategic one, procurement can adhere to the “do no harm” principle by fostering local economies. By aligning procurement practices with the Sustainable Development Goals (SDGs), such as promoting gender equality (SDG 5) and stimulating economic growth (SDG 8), we can enhance local markets and economies. Despite the rhetoric around local procurement, the reality, if we take a look to Senegal (see for more on this subject my blog about my talk during the African Logistics Conference in Dakar in February 2024), UN procurement data reveals that only 0.16% of total UN procurement spending comes from Senegalese companies. From that over 80% of spend on services and only 20% in goods. In Sierra Leone, only 0.10% of UN procurement value comes from local suppliers, with 29% in goods and a mere 3.5% in food and agriculture products. To truly localise, we must move beyond our supply chain bubble, demonstrate the broader impact, and develop new KPIs that integrate supply chains into project proposals and funding strategies.
In conclusion, as we look towards 2050, it’s clear that the future of humanitarian operations lies in a strategic shift towards localisation and empowerment through procurement. By embracing this vision, we can ensure a more effective, efficient, and equitable humanitarian response that supports local economies and communities worldwide.