The role of multinational companies in aiding humanitarian logistics

Cynics may claim that traditional corporate social responsibility (CSR) initiatives were about throwing money at a problem and being rewarded with a glossy brochure and a few great photo opportunities for the annual report. Whether this perspective is fair, today’s public-private partnerships (PPPs) are far more engaging as companies play an active part in projects and provide technical skills focused on their core area of expertise.

You don’t need a large organisation or ageing rockstar to start a successful partnership. There are great opportunities to form partnerships at a local level — which are likely more sustainable and less susceptible to political or popular culture shifts.

What can multinational companies bring to the table?

Connectors – Besides financial support, multinationals can act as connectors between other companies, NGOs, bilateral donors, foundations and universities. For example, The Coca-Cola Company actively engages with organisations such as Yale University and the Gates Foundation with PPPs during their Project Last Mile.

The right fit – Not all companies will be a good fit for every work stream, but if companies focus on their core skills — value can be created. Good project examples of this is Coca-Cola in distribution, DHL in supply management and cold chain, and IBM in technology.

Local networks – One of the great advantages of multinationals, is their ability to tap into their local networks and connect project teams with local operations and expertise on the ground. Local operations understand local trading conditions and can access local cost structures. International project teams can also see how these companies operate in a difficult operating environments and solve problems at local level. Often with limited resources. For example, in one project we received great insight from SABMiller (merged with A.B. InBev) about transportation management in South Sudan. The brewer shed light on some technical difficulties when importing vehicles and the challenges with recruiting qualified technicians in the country.

Points of engagement – Multinationals can opt for a number of points of engagement that can include boards, technical advisers, imbedded project teams, and providing shared resources. In some cases, companies might also decide to appoint a resource to liaise between the project team and the local operation.

Multinational companies as the superheros?

It is important to note that multinationals will be unable to solve all challenges and also struggle with some of the same issues as humanitarian logistics organisations. For example, multinational companies have yet to write the definitive guide on last-mile logistics in Africa. Some have been successful in certain areas such as Coca-Cola in micro distribution on the continent. But companies often don’t trade in rural areas where NGOs operate, and most work with intermediary distributors, and often lack supply chain insights. They often don’t have sufficient boots on the ground, as they trade out of a regional commercial centres.

However, there are a number of areas where companies can add value and provide value and insights.

Demand planning & procurement – As humanitarian organisations move from emergency to development, there is an increased need to understand demand planning and procurement. Multinational companies with years of experience in operating in tough and unpredictable environments, can provide valuable insights.

Routing and scheduling – In emerging markets, information such as routing to health centres, is not always well structured and good network design can add significant value in the long term. Companies can also bring unique insights about last-mile logistics and working with distribution partners.

Transportation management – Scheduling and vehicle maintenance remain areas of opportunities for many organisations. Riders for Health, a non-profit organisation, has made this their core focus. However, there remain significant opportunities in this area for many organisations. Furthermore, multinationals can also provide great insights on 3rd party logistics and how to negotiate local transport rates.

Incentives insights – There is increased interest in how multinational companies employ incentives to motivate employees and increase productivity. In many cases, a robust incentive scheme to boost productivity and efficiency is absent in the public health sector.

Benefits to multinational companies?

Employees and community – Most employees love to give back to the community. Local employees have a vested interest in what happens in their community and they take great pride in their ability to solve problems. Companies also become a more desirable place to work as employees take an active part in solving humanitarian logistics challenges.

Learnings – There is a lot to learn from humanitarian organisations and other NGOs. For example, in mobile technology, the not-for-profit sector has been on the forefront of adopting and piloting a number of projects that could be of interest in the business world. Very few multinational will have a clear understanding of rural distribution, and company employees can learn a lot of solving complex problems in challenging environments.

Shared infrastructure – There is also a real opportunity to share infrastructure, especially in rural areas where it’s always hard to make the financial numbers work. With the right partnerships, shared resources can bring mutual benefits to NGOs and companies involved.

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google photo

You are commenting using your Google account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s

This site uses Akismet to reduce spam. Learn how your comment data is processed.