Dribki Kaoutar1By :Ms. Dribki KaoutarProfessor : Dr.Larry HowardSupply Chain Management9 December 2011 UNITED NATIONS Supply Chain Process in The UN Supplying missions of UN &View of the contract ofDanoffice Supplier of Digital camcorders
Dribki Kaoutar2Abstract:In the following is a study about the supply Chain process in the UN and how far is applied tothe main component of supply chain process referring to Christopher book. We took the case ofsupplying digital cameras by Danoffice from Denmark to identify part of the supply Chainprocess with UN and the main applicable steps .
Dribki Kaoutar3Vocabulary :(Please see also Annex 9)BINUB: united Nations integrated Office in BurundiMINURCAT: United Nations Mission in the Central African Republic and ChadDFS:Department Of field SupportDO: DanOfficeUNLB : United Nations Logistics BaseUNDP :United Nations development Programme
Dribki Kaoutar4Plan:I.Introduction -The organizational structure of DPKOB-Procurement Division: Role & responsibilities Customers&activities Major Goods &servicesC-Supply Section Main areas of commodities Supply Chain :Operation management a) Demand Planning and Forecasting b) Supply Network Planning II.Application: Supply of digital equipments Background of the company in this business United Nations & Global impacts United nations digital equipment proposal Warranty , quality of products & delivery time Logistics & packing of goods Payment & Manufacture authorizations
Dribki Kaoutar5I.Introduction:This paper will take on the supply chain process in The UN which is an internationalorganization dealing with different entities around the world. The Global strategy of theorganization aimed at transforming service delivery to the field missions ,building on existingtools and mechanisms and it is geared toward improved service delivery to 35 field presencesserved by the department of Field support. There are many challenges that confront the supportof the fields.The main part of the Department of Field support that deals with the supply processis The procurement division that maintains most of contracts and financial Operations That thesupply division and the logistics division request. -The Organizational Structure of the DPKOAt present the DPKO is divided in 2 offices; the Office of Operations, which essentially takescare of political issues and the Office for Mission Support (OMS). The OMS in turn is againdivided in two divisions; the Logistics Division and the Administrative Division. The LogisticDivision is responsible for the coordination of activities related to information,Telecommunication, health, engineering, transportation (air and land), and supply of materialsfor construction and maintenance of missions. The proposed organization for the LogisticDivision of the OMS for 2006-2007 includes some 182 persons and is structured in threeServices : the Operational Support Service; the Specialist Support Service and theCommunications and Information Service Technology.The Office of Aviation Safety controls the flight security through external contractors
Dribki Kaoutar6as the United Nations itself does not possess any aircraft. This unit is not a part of the AirTransportation Section, in order to assure its objectivity and transparency.The Operational Support Service too is divided in two sections: Logistic Operationsand Logistics Policy. The former coordinates the logistic operations of interfaces (such asengineering and materials flows) between troops (also referred to as the Blue Helmets) andthe civil administration of the United Nations. The latter takes care of the definition of thepolicies and technical normative of the intervention.Specialist Support Service (SSS) is constituted of seven sections: Air Transport;Surface transport; Medical; Supplies; Contingent Owned Equipment (COE); and Engineeringand Cartography. The Air Transport section assists the missions in the activities arranging airtransport, conducted by external contractors, in all contractual aspects. The Surface TransportService has similar functions, although in this case the vehicles actually belong to the UnitedNations. The Medical Support Service, other than the complex exercise of coordination ofseveral missions, has a normative task of standardization of doctors, budget preparation,contracts, and location of the doctor-sanitary materials and management of refresher courses.The Supply Service takes care of (a) the preparation of the technical detailed lists of materialdemands for the exercise of peace operations (e.g., food supplies, potable water, gasoline); (b)administration of this material and the contractual aspects. The activities of procurement andcontract bids are directed by an external office to the DPKO belonging to the Department ofManagement of the Secretariat. For each mission a decentralized office of procurementhandles amounts up to $200.000, operating independently from Headquarters in New York.Materials management (COE) belongs to troops participants to missions and coordinates thecomplex negotiations and technical detailed lists between troops of the Member States and those
Dribki Kaoutar7of the United Nations. Engineering takes care of technical norms and policies for thestandardization of the engineering activities; technical detailed lists for bids; technicalassistance to the missions; training of the staff; and the management, through a computingnetwork, of engineering materials of the SDS. Cartography supplies cartographic technicalassistance and logistic assistance in the field (e.g.: identification of optimal sites for theconstruction of military encampments). Communications and Information Technologyoperates and manages, through UNLB, all computer telecommunications equipment. ThisService maintains in real time databases relative to materials and staff.The Peacekeeping Operations of the United Nations:The logistics of the InterventionWithin the United Nations, the power and responsibility to institute and maintain peacekeeping operations rests with the Security Council. At the operational level, the Departmentof Peace Keeping Operations (DPKO), instituted in 1992, has the mandate for the planning,preparation and directing these peace operations, which are considered the United Nations’instrument to help countries suffering from conflicts to create conditions for sustainablepeace.At present, there are sixteen ongoing peace keeping missions and two politicalmissions (Fig. 1). Since the creation of the United Nations in 1945, 62 of such missions havetaken place, 15 prior to1990 and more than 40 ever since). During these missions, militarycontingents and/or military observers that are provided by the member states of the United
Dribki Kaoutar8Nations.fig:1Seven of these missions have a more permanent character. Some of the missions arefinanced with the regular budget of the United NationsSupply Chain Context in the UN:In the Supply Chain context, the main operational performance drivers relate to themanagement of inventory, transportation, facilities and information. these four drivers aredescribed as follows:(1) Inventory – Inventory refers to all the raw materials, work in progress and finished goodsof the organization. Inventory levels are a powerful tool that influences the supply chain’sefficiency and responsiveness. Through their reduction organization become more
Dribki Kaoutar9efficient as it lowers their inventory carrying costs. However, maintaining minimuminventory levels may compromise the organization’s ability to respond to sudden surges inrequirements. Maintaining higher levels of inventory contributes to an organization’sability to respond promptly. However these additional inventories increase the overallcosts by locking up capital in inventory carrying costs. In addition, they also increase therisk of product damage obsoleteness.(2) Transportation – Transportation refers to the movements of inventory from one point in asupply chain to another. Reducing minimum shipping quantities might benefit immediateresponse time but it will decrease transport efficiency and increase costs.(3) Facilities. The facilities in the supply chain context encompass all places in the networkwhere inventory is stored, assembled or fabricated. A higher density of facilities willenhance responsiveness but reduce efficiency by increasing costs. In the particular contextof humanitarian relief case, dispersing inventory over a wider geographical areapotentially implies facing additional safety concerns that might further increase costs dueto a greater need for security.(4) Information. Finally, the information consists of data and analysis regarding the inventory,transportation, facilities and customers throughout the supply chain. Information ispotentially the biggest driver of performance in the supply chain as it directly affects eachof the other drivers. In environments prone to instability, such as the ones in our case, ahighly dispersed network strongly increases the need for information yet at the same time,it increases the threat of an obstructed flow of accurate and timely information.Table 1 shows how the application of leanness and agility approach influences anorganization’s supply chain performance drivers. To make its supply chain leaner,
Dribki Kaoutar10organizations attempt to reduce their inventory levels and increase minimum shippingquantities (so as to reduce transportation costs). Less dense networks of facilities contribute toelimination of waste and reduce the exposure to potentially hostile elements (stealing/attacks).Gaining more precise and detailed information on the requirements and preferences ofdifferent members of the supply chain facilitates supply chain officers’ ability to optimize thesupply chain performance drivers, regardless of whether the organization aims to have lean oragile operations.Table 1: Application of the leanness and agility paradigm to the supply chain performanceDrivers Lean AgileInventory levels Decrease IncreaseTransportation costs (Minimum order quantity) Increase DecreaseFacilities density Decrease IncreaseInformation Increase IncreaseIn short, supply chain officers are appointed to enhance organizations’ effectivenessby managing the supply chain drivers such as to reduce waste whilst assuring responsivenessto demand fluctuations. The appropriate management of these drivers, furthermore, helpskeeping costs associated with operating the supply chain at lowest possible levels whilstavoiding erroneous deliveries, undesired supply delays or full stock-outs.The ideal supply chain, however, is likely to embody both lean and agile principles toensure the highest level of responsiveness combined with low costs and efficient processes.The particular supply chain configuration that describes such upstream processes has been
Dribki Kaoutar11termed as “leagile” 1. Lean processes upstream facilitate a low cost and low risk supply chainwhilst agile processes downstream assure high levels ofresponsiveness to the needs in the field. The agility of the latter processes is achieved throughcreating higher strategic buffers (inventories) at the lower end of the supply chain and thepostponement of product customization. In other words, an organization might simultaneouslyoperate the leanest agile system and the most responsive lean system. In humanitarian reliefenvironments, the optimal position on the lean-leagile-agile continuum will differ from itemto item and from mission to mission. The definition of the best approach will therefore requirecontinuous revision. What might be the optimal approach for one field operation might not beadequate for another. Ultimately, the choice of the main focus of the supply chainmanagement efforts (be it lean or agile) depends on the composition of the marketwinners/market qualifiers2. Market qualifiers refer to competitive pre-requisites which representa base level of performance, whilst order winnersrefer to critical differentiating factors. A- Procurement division Role & responsibilities :The division acquires of appropriate goods and/or services at the best possibletotal cost ofownership to meet the needs of the purchaser in terms of quality and quantity, time, and location.1 By Naylor, J. B., M. M. Naim, D. Berry. 1997. Leagility: Integrating the lean and agilemanufacturing paradigms in the total supply chain. International Journal of ProductionEconomics, 62, 107-118.2 By Christopher M., D. Towill D. 2000. Supply chain migration from lean and functional to agileand customized. International Journal of Supply Chain Management. 5(4), 206-213
Dribki Kaoutar12Corporations and public bodies often define processes intended to promote fair and opencompetition for their business while minimizing exposure to fraud and collusion.Procurement Division provides responsive, effective, and quality expert procurement servicesand business advice to UN Headquarters, peacekeeping missions, and other UN organizations,while achieving best value for money and ensuring a competitive, fair and transparent process inaccordance with established regulations, rules and procedures. Customers & activities: • The main customers of the UN that they are in contact with the Organization through the division in studies are varied regarding the goods or the services required:UN Headquarters Departments in New York: Office of Information and Communications Technology (OICT) Facilities Management Service ( FMS) Information, Political Departments • DFS HQs and Field Missions: Logistics Division at New York Peacekeeping and Political Missions throughout the world • Offices Away from Headquarters (OAH) & Other organizations seeking procurement support services (External companies) Major services & goods: will identify the services and goods requested by fields . Structure & supply responsibilities: it develops each sub-structure of the procurement division and the main role of each part .the main parts are:
Dribki Kaoutar13*Supply team –IT communication team-infrastructure team-Management services Team-Field supply team-Field support-Engineering team-Vehicles Team-Air Charter-Strategic Cargo Movements .” wealth without work, pleasure without conscience, knowledge without character, COMMERCE WITHOUT MORALITY, science without humanity, worship without sacrifice, and politics without principle”. By M. Gandhi B- Supply Section : Main areas of commodities : The supply services in the UN mainly develop the following area in the supply section : • Sourcing • Strategic Deployment Stocks • UN Reserve • Systems Contracts • Inter-mission Transfers • Member States Fig.2
Dribki Kaoutar14 Supply Chain Process:Elaboration of the explanation of the following chain that provide the image of the Supply chainprocess takes on : 1. The flow chart above fig .2shows a typical manufacturing supply chain work flowdetailing which areas of the business are involved.2. The sales department identifies a need for a product. The sales department tell the marketingdepartment about their idea and provide any supporting information / data.3. The marketing department use business analysts to support the project and to complete theresearch.4. Data and supporting evidence is passed back to the marketing department for completion of abusiness plan.5. A fully detailed business plan is forwarded to the Business Unit Manager / Directors.6. This unit comprises of the senior business directors or managers who make a decision on theproject.7. After approval the plan is passed back to the analysts to prepare and implement themanufacturing process.
Dribki Kaoutar158. Details of raw materials and components passed to purchasing.9. Purchasing work with logistics and transport to plan the purchase and delivery of the materialsto the manufacturing plant.10.Suppliers receive orders for product and then dispatch on agreed transport on agreed dates.11. Carriers approved by the business transport the raw materials and components to themanufacturing site.12. Products are received into the warehouse and then moved to manufacturing.13. Finished products are moved from manufacturing to the finished goods warehouse whichmight be situated locally or in a remote location.14. Finished goods are put into inventory awaiting orders. The company computer system isupdated. Product is now available to sales.15. Customers place orders through customer services.16. Customer Services take orders and input them to the company computer system.17. The central computer system maintains transaction records and provided visibility of productfor sale.18. An order is completed and a pick list sent to the warehouse.19. A copy of the order is sent to the export department for completion of export documentation.
Dribki Kaoutar1620. Export department manages the final dispatch of the product and produces any exportdocuments.21. Documents are sent to the warehouse to meet up with the finished order.22. The order is dispatched by the warehouse.23. The transport company collects the consignment and delivers it to the customer based uponthe INCO terms of carriage.24. As stock has now been used the computer system generates a request for new stock.25. The re-order process generates a request to the purchasing department to place new orderswith the suppliers.The primary decisions made within the supply chain include: Sourcing o Quality of product o Choosing suppliers o Location of suppliers o How much product to order o Transportation channels Production o Location of production (domestic, international) o Make vs. Buy
Dribki Kaoutar17 o Capacity of plants o Quality of the product (low cost leader, differentiation strategy) Inventory o How much inventory to hold (safety stock) o how much to order o when to order Logistics o Transportation - best way to get the product to the customer Truck Rail Air mode of transport shipment size o Location of distribution centers in order to keep customer service high and costs lowSome of the objectives of a supply chain manager include: Increase communication along all nodes of the supply chain to create an uninterrupted flow of materials. Decrease inventory while still maintaining high customer service levels. Reduce the supplier base and develop supplier relationships in order to reduce overall costs.
Dribki Kaoutar18Standardize parts as much as possible in order to reduce the amount of inventory neededto be carried. Example for fuel distribution: Supply Section, DFS • Supply Chain – Fuel COE/UNOE LOG Base Ship Ship Sector Refinery Main Tank Terminal SFR Tank Farm LR Transportation Main Main Storage SHQ Team Sites End Users Source TRANSPARANCY & REAL TIME INFORMATION
Dribki Kaoutar19 A) Demand supply and forecasting :The UN Supply Network has grown in complexity. Planning the right material and/or service, inthe right place the right time has become more critical ,as we can notice from the planning of Master Data Management Source to Acquire Plan and Manage Fi Pr n Contract Supplier Long-Term Managemen Collaboratio Planning oj a t n ec nc Requisition Supply Demand to Purchase Network Planning t ia Order Planning Low – Value Force M l Acquisitions Planning a A n cc Force Deployment ag o Inbound Planning Set Decommissi e u Processing and Assembly on and Dispatching and Disposal m nt Warehouse Outbound Execution Equipment Equipment e in and Storage Assignment Maintenanc e and nt g Operations Receive to Distribute Employ to Dispose Management Reporting Fig.4 Integratins of supply Chain elements .Fig.4
Dribki Kaoutar20 The integration planing of the strategy of the supply chain , the operations and the tactical plans ,aim the following goals: Extension of the rolling operational plan with simulations for demand, supply and capability analysis Material and or service life-cycle factors to drive strategic sourcing and fleet management decisions Horizon of 10 years, coinciding with the second year of the Operational Demand & Supply Plan and reviewed monthly Initiatives will be needed to close the gap between the LTCP plan and the monthly operational demand & supply plan Review requirement for budget execution as operational plan becomes established and credible(see fig.5)
Dribki Kaoutar21 StrategyFig.5 Supply Networking Plan : Supply Network Planning (SNP) ensures the optimal Use of Procurement, Manufacturing , Distribution, and Transportation Resources to meet Forecasts and actual Demand while considering all Constraints in the Supply Chain Supply Network Planning plans Procurement, Movements and Manufacturing throughout the entire Supply Network using Optimizing and Heuristic Approaches Demand Planning in The UN : Demand Plan: A demand plan is differentiated from a forecast in that it is considered a commitment to generate the future demand. This philosophy
Dribki Kaoutar22considers the reality that demand is influenced by the actions of the organizationalstakeholders and the plan must be supported by appropriate sales & marketingactivities. The Demand Planning (DP) module isused for forecastingDP support following statistical forecasting methodsUnivariate (Time-Series) modelsMultiple LinearRegressionComposite forecasting (model combination)LumpydemandExternal forecastForecast in days, weeks, months, quarters, yearsFeaturesStatisticalforecastingLife cycle managementPromotions planningCharacteristicsBased PlanningConsensus Demand Planning(Please see fig.6)
Dribki Kaoutar23 Aggregated historical data Planning levels: Future Demand Forecast • Location • Product hierarchy • WBS • Commodity Group • Region • Statistical Forecasting • Collaborative Forecasting Sales Goods • Corrections Reservation orders Issue • External Forecasts • Market Intelligence Fig.6 II.Application of Some Parts of Supply Chain Process : Case of Danoffice Supplying the UNBack ground of the company:Danoffice Plc for the provision of digital camcorders is supply digital camcorders to the UN.Thecontractor& it is corporate headquarters is located atEnglandsvej –Svendborg Denmark.The contract is made between the UN an intergovernmentalorganization. Danoffice is Danish based IT company founded in 1995.Today counting offices inDenmark and USA.They work closely with their partners not only while selecting the equipmentbut throughout the entire process from analyzing the needs supplying and installing the
Dribki Kaoutar24services.DO offer one stop shopping concept with the possibility to mix products and brands,They do supply IT services in more than 250 organizations all over the world.They are anauthorized value-added reseller of major brands such ,but not limited to HP,Dell,APC,Powerware .Cisco. ,Fujitsu-Simens,IBM,Canon,Motorola,Codan..DO Work directlywith manufacturers and have the necessary backup to make things happen,The past 12 years inbusiness have further more given DO an in depth knowledge of how the manufacturers operateand how their systems should be approached , in order to obtain timely deliveries and smoothoperation of long-term-Agreements.In 2008 ,Do expects to ship out some 4,000 consignments ofIT equipment going to +200 different organizations in more than 135 countries worldwide.Doserve customers in Europe,the Balkans ,Africa,Middle East ,Far East.North –and SouthAmerica.Do expect to turnover of USA.Partner solution concept:This concept provide our partners the possibility to outsource their IT and telecommunicationprocurement,training,call center..During the frame agreement . DO have regular meetings withthe client here we evaluate and improve our collaboration to common benefit.The 4 corner stonesof DO make it committed to Focused , Flexible,Fast& Friendly service to every customer. Focused :The product knowledge and experience within exporting of IT,IS & communication equipment to developing countries allo DO yo grow beyond the supplier’s role and to function as a trusted partner.
Dribki Kaoutar25 Fast: DO are open 24h/7days assistance from our certified technicians and sales staff is available 24h and 7 days a week.DO deliver the products from their stocked warehouse facilities and can expedite the order by fastest means of transport enabling your goods to arrive within a week anywhere . Flexible: Do work Closely with their customer not only while selecting the best solution to their needs but throughout the entire process before during and after delivery.The service selection include mode of transport ,appropriate packing ,pre-inspection on quality and quantity ,pre-installation image,onsite installation of equipment,hands- ontraining, warranty insurance and much more.Everything you need to get and your staff up and running as quickly as possible,Thats what we call a turnkey solution. Friendly:In case of IT ,IS or communication issues do not hesitate to contact DO any time.Danoffice corporate Philosophy Danoffice act responsibly to operate according the values they believe in donations and voluntary work they strive for: -A better world where nature and people live in peace and harmony -Improving the quality of life for rhe mankind --Humanity:Respect for all people regardless of nationality ,racereligion,class,or political opinion. DO find that the social interaction between people and happiness are the most valuable assets in life. -Environment :Mother Earth is wonderful place which we must guard and hand over to the future generations with care .DO work only with vendors with environmental policies.
Dribki Kaoutar26-Ethics : Danoffice wishto be depreciable partner who always acts responsibly ,honestlyand fairly, whether dealing with customers ,vendors ,colleagues,investors or competitors.- Good governance: Understanding the customer’s needs but also on side the customer’sexpectations .Do challenges ;Nothing is impossible .DO is enthusiastic about theirwork”You may say we are Dreamers,but we are not the only ones,I hope someday youwill join us and the world will be as one”Inspired by John Lennon.United Nations & Global impacts:The natural part of our business to embrace , support an enact the 10 principles of the UNGlobal compact.Human right: Business should support and respect the protection of internationallyproclaimed human rights and make sure they are not complicit in human rights abuses.Labor:-Business should uphold the freedom of association and the effective recognitionof the right to collective bargaining.-The elimination of all forms of forced and compulsory labor-The elimination of discrimination in respect of employment and occupation.Environment: Business should have a precautionary approach to environmentalchallenges.Encourage development and diffusion of the environmentally ,friendlytechnologies.Anti-corruption:Business should work against corruption in all its forms ,includingextortion and bribery.In respect of system contacts with UN ,DO listed ongoing systems contracts withdifferent UN agencies including DPKO and UNPS ,in which the implementation and the
Dribki Kaoutar27 handling support required documentation on the sales support of every mission as following United Nations Digital equipment proposal: DO have strong relationship with the famous manufacturer as HP,Sony,Canon etc..Ascontractor DO wil ensure that the products are boxed,marked and shipped insets.When a UNunits receive a digital camera it comes in a box containing camera , charger and 2 sets ofbatteries ,4.GB memory & car charger.That will ensure that the set is delivered complete to each
Dribki Kaoutar28Unit of DPKO mission. Also we have to ensure that the products are supplied 100% genuine ,andnew unopened. Warranty, Quality of products & Delivery time: Working with international organization that operate in remote areas and developingcountries,DO are aware of importance of fast and efficient support.All Products under a PossibleLTA between UNPS/DPKO mission and DO will be covered by 1 year internationalmanufacturer’s warranty.For destinations without any local service provider or in case of a localservice provider not meeting with the expectations of DPKO missions , DO will ensure to givethe extended warranty service per hour.The Un will have full support by manufacture registeredservice partners.Other Warranties offered by Danoffice in order to ensure stability and fullfunctionality at end destinations worldwide. Quality assurance system(Quality of Products) Referring to the request of The UN ,DO offered high quality products by Canon,BenQ,and Sony that in accordance with your technical requirements(view annex 9 aboutManufacturer’s authorizations forms. Delivery time: Please refer to the following table about te delivery time in different location:
Dribki Kaoutar29 Logistics and Packing Goods: Do’s in House logistic team has in 2007 shipped out some 2750 consignments of ITequipment going to 234 different organizations in 135 countries worldwide.Working only withselected world known and well reputed shipping companies likeDSV,Nagel,Mahe,DHLetc.ensuring that The customers’ good arrive safely at the enddestination.The combination of using world know shipping companies combine with DO’sexperience in delivering IT equipment ,gives us a claim rate in 2007 below 0.8%. Packing Good: Through many years of experience with exporting to developing countries , we know theimportance of a strong and durable packing.A correct packing minimizes freight costs ,loweringthe risk of transport damage and theft. DO offer various packing solutions to meet the different requirements by the customersPlease see the following figure
Dribki Kaoutar30 DO will follow all international export regulations,and for selected destinations exportlicenses are required regardless of the products and ECCN number.The following destinationsDO are by US regulations required to apply for export licenses Cuba,Iran ,Libya,NorthKorea,Sudan and Syria.This process can take up to 6 weeks from date of filling the application toUS authorizations , UNPS might be requested to assist with supporting documentation subject tocertain procedures and upon notification by US authorities.Payment & Manufacture AuthorizationsThe payment regulations are to be made by UNPS within 30 days after presentation of the agreeddocuments.All DO documents will be marked with UNPS order number ,product description ,serial numbers and DO banking detailsManufacture Authorizations:See the following figures as an example from Canon Manufacture
Dribki Kaoutar34 Works CitedNaylor, J. B., M. M. Naim, D. Berry. 1997. Leagility: Integrating the lean and agilemanufacturing paradigms in the total supply chain. International Journal of ProductionEconomics, 62, 107-118.Christopher M., D. Towill D. 2000. Supply chain migration from lean and functional to agileand customized. International Journal of Supply Chain Management. 5(4), 206-213.Author’s last name, first name. “Title of Online Article.” Title of Online Publication VersionExample of UN contract with DanOffice Main document (Please see attached).Web resources: 2010 United Nation Logistics Base Webpage, www.unlb.org UN General Assembly 59th Session: Session Documentation,www.un.org/ga/59/documentation/list2.hmtl (for all documents listed in the article). 2010 ,Department of Peacekeeping operations (restricted access to just for members f UN http://www.DPKO.com.