Distribution rarely makes an appearance on the main stage of the Globalisation debate. Specialist literature on logistics or supply chain management is confined to the margins and yet, few countries are in a so-called developed state and, the vast majority need a revolution in infrastructure and connectivity to have any chance of transforming their economies to reap the rewards of globalisation or, improve their local realities.
Paul Collier has tracked a number of African countries where natural resources have not generated the desired social dividends and many other commentators highlight countries torn apart by civil war or, natural disasters to be plagued by the dead hand of corruption. And yet, in some Report or, Strategic Plan somewhere visions of a viable market-led economy tied together by logistics languish. Let’s look at the journey that all such countries have to travel.
All countries torn apart by war and many wrecked by natural disasters turn to military logistics to put them back together. Temporary bridges and makeshift roads are laid to pull together isolated communities and, lay out the network that can allow a second phase Humanitarian logistics effort to work. Now, the work of reaching the needy with food and the sick with medicines can begin. And yet, the next set of images that we see in this narrative is based on a business case from the developed world. It is as if we move from military and humanitarian logistics to a market led solution in one giant leap. From mayhem to shopping mall is not the logistics next step. Mind the gap.
No wrecked economy can move from a dependency on military and humanitarian logistics to a fully formed state-of-the-art logistics in one leap. The truck industry will be too fragmented; retail will remain an mom-and-pop store domain and, the emerging narrative will take place in the informal – though Majority – world.
This is where Transformational Logistics comes in. We need to develop a tool kit that can help transform economies through simple and effective logistics techniques – many of which will be drawn from the informal marketplace. After all, state-of-the-art equipment is neither adaptable to local skill levels; affordable to the small companies that dominate the business landscape or, accessible to anyone other than large Corporates. And yet, there is no body of work or techniques that deals with this massive need.
From end-to-end supply or value chains need to be more inclusive and develop fresh practice based on local realities. Take Iraq – the military are moving out. Who is going to maintain and develop the connectivity that was put in place for military activities? Then, what happens when the sophisticated humanitarian effort that distributed vital foods and medicines is gone?
Places like Iraq need help to build a viable logistics industry that can deliver a sustainable solution. They need a logistics industry based on:
1. Local skills. What is in place to ensure that the skills that came from elsewhere can be found at home? Is there any notion of a Skills Gap Analysis or, a view on the skills needed going forward? Let’s face it, few countries will be able to afford expensive ex-pat labour to build their market economy.
2. Local demand. What are the consumer markets that can generate critical mass so that a market economy can thrive? Do we understand the rural / urban divides? Do we take the drift to urban areas as inevitable or, can we harness technology to connect remote areas to local, national and global markets? For example, the mobile revolution is opening up all manner of aggregation and fresh business opportunities.
3. Local companies. Many of these players will be from the informal economy – rarely a bankable proposition. They will not have the legally backed assets and, employment will not have the “packages” that exist elsewhere.
Transformational Logistics is an umbrella term for the very skills and techniques that can bridge the gap from military and humanitarian to local and sustainable solutions. Indeed, how many development projects incorporate a T L perspective into the tenders that drive them? How many insist on a local skills strategy; a local sourcing strategy and a local energy strategy tied to local realities? Few. Why?