Supply Chain Improvement Plan

Supply chain costs constitute about 80% of emergency expenses Total Spent in FY2006 = $ 646 Millions (CARE USA) Supply chain constitutes about 60-80% of the emergency programs costs. Highlight amount involved and importance of efficient operation, Warehousing Staffing Transportation Relief supplies Food Gifts-in-kind (GIK) Equipment $102 - 136M

Our Challenges No standardized systems & tools, Generally ad hoc operations with a “separate” supply chain operation for each response, No standardized systems & tools, Lack of supply chain visibility, Inadequate monitoring & oversight of operations.

We need to improve

Why CARE Approached UPS Atlanta based Organization Logistics - Core business Global Operations Significant warehousing and transport asset Has been supporting CARE’s emergency operations for past few years Interested in humanitarian aid support UPS Foundation communicated its intention to evaluate appropriate support in supply chain and logistics capability

UPS Exploration Visited 3 CARE country offices to see operations & realize challenges, Interviewed 4 Country Directors to understand field needs, Interacted with emergency staffs during Bangkok workshop.

Recommendations A set of 24 small and big projects to be introduced in a phased manner Priority I – 5 Critical projects (immediate implementation) Priority II – To be introduced in the medium term (12 to 18 months) Priority III – To be introduced in the longer term (18 to 24+ months)

Project # 1 Supply Chain Unit Objective: To be responsible for all supply chain business processes and tools & their continuous improvements by providing oversight and monitoring to ensure compliance and accountability. Approach – Review other SCM model Define unit structure/plan Define resource reqmt. Mobilize & implement Benefits – Strong logs. Capability Standard processes Improved response

Project # 2 Inventory & Warehouse Mgmt. Objective: To define in-bound and out-bound logistical processes while standardizing all warehouse and inventory management practices. Approach – Storage guidelines Warehouse layout plan Inv. Mgmt. procedures In & Out bound processes Training materials Benefits – Consistent procedures Improved inventory and warehouse management

Project # 3 Commodity Tracking System Objective: To provide accountability and visibility of all commodities and support efficient management of supply chain operations Approach – Gather requirements Identify system Customize system Pilot system Train & roll out Benefits – Global visibility Improved accountability Systematic tracking of commodity transactions

Project # 4 Relief Supply Pre-positioning Objective: To leverage strategic partnerships to mobilize resources for timely and effective emergency responses Approach – GIK policy Relief supply catalog Strategic partnerships Source/Mobilize and pre-position relief supplies Benefits – Increased response speed Improved supply quality Cost effective

Project # 5 Access to partner resources Objective: To enhance preparedness and capability to respond to emergencies using strategic alliance partner logistic spare capacities Approach – Map partner spare capacities Develop partners’ operational protocol Establish CARE protocol to access partner’s resources Benefits – Increased warehouse and transport capacity Improved responsiveness Broadened logistic scope