Humanitarian relief chain: Rapid response under uncertainty

• Published in: International journal of production economics 2014-05, Vol.151, p.146-157
• Main Author: Chakravarty, Amiya K.
• Format: Article
• Language: English
• Subjects: Budgeting; Chains; Costs; Disaster relief; Economics; Humanitarian aid; Humanitarian relief; Logistics; Maximization; Rapid response; Real time; Strikes; Studies; Supply chain; Supply chain management; Two stage decision; Uncertainty; Value chain
• ISSN: 0925-5273; 1873-7579
• DOI: 10.1016/j.ijpe.2013.10.007

The recent worldwide devastations have reemphasized the importance of rapid response for saving life. Relief supplies must arrive on time and in adequate quantities. Coordination in a relief chain is complex because of the uncertainties associated with disaster intensity, strike probability, infrastructure-disruption, and the actual damage. The relief effort must weigh the expected social value against delivery delays, and costs of logistics. We explore a 2-stage proactive/reactive approach where response time and relief amounts are decided ex post (after disaster occurs), and the prepositioned inventory is determined ex ante (before disaster occurs). Our major findings are: (i) the response quantity and time must be adjusted to imputed social value, but differently at different disaster intensities and cost structures, and in different communities, (ii) disaster intensity can be categorized into ranges that reveal whether rapid response and/or large relief quantity would be appropriate in each range, (iii) effectiveness of the relief strategy decreases as the disaster intensity increases, and (iv) in scenarios with limited budget, it is possible to earmark a unique budget for real time relief operations, that ensures maximization of social value. •Disasters, causing disruptions, have both economic and humanitarian consequences•Considerable uncertainties exist in disaster-intensity, strike-probability, and the actual damage•The social cost increases with shortages and delivery delays, and demand for relief supplies decays in time•A 2-stage coordination integrates the prepositioned inventory with real time deliveries to maximize social surplus•Rapid and slow responses (and large/small relief-quantity) can be justified in different scenarios