Supply Chain Procedures en 2005

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Supply ChainSupply ChainProceduresProcedures

May 2005

Logistic Department

Action contre la Faim


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Document revision history

Revisiondate

Author Summary of changes

25/15/2004 LogisticDepartment

Initial release

01/05/2005 LogisticDepartment

Clarification order chain, correction various mistakes

Notes:

Table of contents:

1 - Introduction.............................................................................................52 - The supply chain.....................................................................................6

2.1 Action contre la Faim supply chain....................................................62.2 Frequency of orders and order chain..................................................72.3 Orders grouping and processing ........................................................82.4 Field orders and orders per budget...................................................10

3 - Orders within the mission.....................................................................103.1 The Internal Order Form (IOF)...........................................................103.2 The Order follow-up..........................................................................12

4 - Orders to the Headquarters..................................................................134.1 The Headquarters Order Form (HOF)................................................134.2 The headquarters order follow up.....................................................14

5 - Orders to other missions and to private companies.............................146 - Filing and archiving...............................................................................15

6.1 In the bases......................................................................................156.2 In the capital.....................................................................................15

7 - Standard forms within the Kit Log V 2.0...............................................15

Action contre la Faim - Kit Log V 2.0 Page 3 / 16V 2.0 English/ 01 supply chain 01/05/2005


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1 - Introduction

The supply chain can be defined as all means, procedures and employeesneeded to achieve the delivery of items to the various projects.

The employees of the Logistic Department are the most importantcomponent of the supply chain.

To identify all the elements of the supply chain is necessary to set up clearand efficient logistic procedures.

The Internal Order Form is the starting point of the supply chain. All theorders and their progression are followed within the supply chain and the

documents are archived to keep the records.

To approve an Internal Order Form is a significant act. The requesterinitiates a supply chain, which will end with the delivery of items. Theorder will be verified at several levels, but the requester remainsresponsible for the pertinence of the order.

This document only explains the supply chain and the orders.

Refer to Procurement Procedure for purchases and contracts.

Refer to Stock Management procedures for warehousing.



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2 - The supply chain

2.1 Action contre la Faim supply chain

An overview from a base perspective: Human Resources,Documents, actions

Requester (department, service) + valid signature

Internal Order Form

Base logistician

Items,Available in Base stock Available on base Not available locally

market

Release Order Internal Order Form(To the Capital)

Storekeeper Purchaser Logistics

CoordinatorSelection of the supplier Capital Logistician

Delivery Note Purchase Order Capital stock CapitalmarketInternational

Expedition of items Validation log & admin.

Administrator Release Order PurchaseOrderHeadquarters

/ cashier OrderForm

Purchase of the items Storekeeper Validation log &admin

Administrator/ Cashier

Purchase of the items



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Delivery NoteExpedition of items

DELIVERY OF ITEMS TO THE REQUESTER

This scheme is not exhaustive of all alternatives, and furthermore, eachmission has specificities.However its a decent overall presentation of the various functions anddocuments needed within the supply chain.

For all articles ordered a budget line has to indicate the funding. For eachproject, Action contre la Faim prepares a budget. The supplies funded bythis budget are normally sufficient to cover the needs of this project.

For non-anticipated need, a budgetary solution has to be found with theadministrator.

Its more productive to identify the solution with the coordination teamthan to send and Internal Order Form without financial consideration,moreover for equipments.

2.2 Frequency of orders and order chain

The centralisation and consolidation of orders is necessary to be able toorganise an optimal supply (including purchase and delivery). To thiseffect, an order frequency and a clear order chain are necessary.

2.2.1 Standard frequency:

- On each base One order per departmentper week

- From the bases to the capital One order every twoweeks- From the capital to the headquarters. Two orders permonth

The frequencies mentioned within the mission are guidelines. The LogisticsCoordinator has to find the correct frequencies for the mission to take inaccount the delivery time, the local procurement opportunities and alsothe context (opening project, emergency)

2.2.2 Standard order chain for field or program orders:



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Requester Base logistician Logistics Coordinator Capital Logistician

International procurement

The different technicians, services or departments are the requesters. Thelogistician of the base is the key element for the processing and follow-up

of these various orders through the supply chain.

2.2.3 Validity of an order

To be valid an order must be in an ACF working language (English, Frenchor Spanish) and has the signature of:

The head of department or service, for orders on the base (Definedby coordinators)

The Logistician-Administrator, for orders from the base to the Capital

The Logistics Coordinator and Administrator for orders to Paris

2.3 Orders grouping and processing

The logistician centralises the orders. He/she will update the order follow-up and will start to process them.

The first task is to sort the products per supply sources

- Local: base stock or local purchase- National: order to capital or to another base

The characteristic of the Capital Logistician is his/her access to largersuppliers and a larger variety of articles.Logisticians should keep in mind that some agencies can make donations(ICRC, UN agencies, other NGOs)

The logistician chooses the supply sources for each item or item categoryaccording to different factors that are:

- Availability & delivery time- Transport and feasibility of transport- Price- Security- Quality

Security: For substantial procurements, Action contre la Faim will alwaysprefer a bank payment, even through an international transfer thanpayment in cash. Cash is one of the major sources of insecurity.

The logistician has also to consider the impact of the procurement on the

local market. There are two opposite considerations to balance:- Capacity building of local suppliers



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- Destabilisation of the local market by massiveprocurements

The logistician has to be vigilant with the supplies from stock.Most of the products in a warehouse are earmarked for a specific project:

the logistician has to respect the coherence between the financial code ofthe product and the destination stated in the order.

The logistician can make temporary use of an earmarked product but hasto reimburse to this stock later on.

To organise the purchases, the logistician will classify the different ordersby item category and not by programme. This classification enables theconsolidation; one supplier will be identified to deliver the total quantityneeded for the various orders.



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2.4 Field orders and orders per budget

- The field or programme order:

The services and departments on a base prepare orders according to theirshort terms needs. The orders sent from the bases to the Capital are alsoconsidered as a field order.

These orders are prepared according to the standard frequency.

- The order per budget:Prior to the beginning of a new funding contract for a program, thecoordination team must organise a planning meeting. The objective is toreview the procurement planning normally already prepared for theelaboration of the proposal. The Administrator, the Logistics Coordinator

and the relevant Technical Coordinator(s) will attend this meeting.

The Technical Coordinator is in charge of validating the needs(specifications, quantities, delivery dates forecasted) of the wholeprogramme within the limits of the allocated budget The Logistics Coordinator updates the procurement planning of thepurchases needed for the project and will verify that the procurementprocedures planned are still feasible. The Administrator ensures that budgetary lines are respected andthat ACF procurement procedures complies with the donor rules. Theadministrator may have to prepare a Z2 authorisation if the donor has not

yet formally approved the budget

3 - Orders within the mission

3.1 The Internal Order Form (IOF)

The Internal Order Form is the compulsory form used for:

- An order within a base- An order from a base to the Capital

To specify the project code, as defined by the administrator, or a moreprecise location enables the Logistician-Administrator or the Administratorto select the appropriate budget line for the purchase, or to determine thefinancial code for a stock release.

The description of the items has to mention the technical characteristics

and the quality required. If the description is not precise enough, the



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logistician will have to request more details to the person who preparedthe IOF before starting the process.For non-usual orders or rehabilitation a separate sheet will be stapled tothe IOF to provide the technical specifications and any necessaryexplanation.

Within an order, the items are classified by categories pre-defined byAction contre la Faim.

The processing of the different orders is easier this way, as the logisticiandoesnt have to reclassify the items through categories.

3.1.1 Internal Order Form within the base

- All the sheets of the IOF are given to the logistician.- The logistician computerizes or copies the IOF in the order follow up.

-The first sheet is given back to the requester with commentsand signature

- The Logistician keeps the 2nd sheet and will indicate Stock ifthe article is in the warehouse, Order if the article is ordered to theCapital or Purchase if the article is purchased locally. This sheet isthen forward to the relevant employee for processing.

If there is a need, the Logistics Coordinator or Logistician Administratormay create specifics IOF forms for rehabilitation, TFC, Day Care etc.

The title of theses forms must remain Internal Order Form +Specialisation. The function and utilisation within the supply chain of thisspecific IOF must remain strictly identical to the standard IOF.

The format of the reference of an IOF within a base is:Requester / Base of processing / Month / Year / Order n in

the year2-6 letters 3 letters 2 figures 4 figures 3 figures

The requester can be a department or a service. The Logistics Coordinatoror the Logistician-Administrator have to define the codes for theauthorized requesters on a base.

Example of utilisation:

The reference of the third IOF from the TFC in Ruyigi (Burundi) to theLogistic Department of Ruyigi in April 2003 will be:

TFC/RUY/04/2003/03



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3.1.2 Internal Order Form to the capital

Only the Logistician-Administrator (or base logistician in absence of Log-Admin.) prepares and sends the IOF to the Capital. The transmission of IOFthrough E-mail or Radio Telex is valid.

Action contre la Faim is inflexible with the fact that oral orders are notvalid.

The format of the reference of an IOF from a base to the Capital is:Base of request / Base of processing/ Month/ Year/ Order nin the year2-3 letters 3 letters 2 figures 4 figures 3 figures

The reference of the IOF uses codes for the bases defined by the Logistic

Coordinator. The three first letters of the base name usually determine thecode.

Example of utilisation:

The third order of the year 2004 in May from Kayanza base toBujumbura (Capital of Burundi) has the reference:KAY/BUJ/05/2004/003.

3.2 The Order follow-up

The order follow up is a major tool for a correct order processing.

The order follow up allows:- A department to be informed of the processing of the on-goingorders- A logistician:

To not forget to process an order, or a particular item and toorganise a delivery

To have the breakdown per programmes of the supplies, or perorders to the capital To organise the purchase by grouping the different IOF, with theintention of processing them per item category or per priority

- The Administrator to identify the committed orders not registeredin the accountancy

The minimum a logistician has to implement is the follow-up of IOF withinthe base.For the IOF sent to the Capital, a base can obtain the information with theCapital Logistician who prepares the follow up for orders received from all

the bases.



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On the base, the order follow up has to be updated and distributed weeklyto the different departments or services. The order follow up is sent fromthe Capital to the bases twice a month.

When requested, a copy can be given to the Administrator in order to

monitor the orders committed on the various budgets.

4 - Orders to the Headquarters

4.1 The Headquarters Order Form (HOF)

Any international procurement, including HOF is under the directresponsibility of the Logistics Coordinator and cant be manage

from a base without his/her prior agreement.

The Headquarters Order Form (HOF) is systematically used for order fromthe missions to Paris Service Achat Expdition SAE. The LogisticsCoordinator prepares the HOF.

This order is sent to the Headquarters to the Logistics Mission Officer by:

- Fax or scan with the signatures of the Administrator and LogisticCoordinator- And by email for a quicker processing

The Logistics Coordinator has to indicate the exact technical specificationsof the items requested.When existing, the code for each item has to be used. The list of codes isindicated in the catalogue edited by the SAE.

Its imperative to mention the transport mode, and unless expatriatestransport the articles its imperative to indicate the budget line for

transportation. Without a valid budget line the SAE will not organise theshipment.

Donors are strict with the budgetary allocation of freight charges. Theyaccept to fund a freight containing products funded by other donors only ifarticles funded by their budget are the majority of the freight.

Very important note

The SAE will only process orders with:

- Budget lines having a validity superior to 1 month



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- Budget lines having a validity superior to 2 months for drugs and medicalsupply

4.2 The headquarters order follow up

The headquarter orders follow up is used to follow the processing of theHOF between the mission and the SAE.

The SAE prepares the follow-up and send it on a monthly basis to all Actioncontre la Faim missions.

The mission must return this follow-up updated with:- The remarks (if any)- The questions (if any)

-Confirmation of the reception of articles

5 - Orders to other missions and toprivate companies

The Logistics Coordinator is responsible for ordering to other missions andto private companies based outside the country of operation.

There is no standard format for ordering between Action contre la Faimmissions. The supplying mission has to define the documents and theprocedure. A good collaboration is essential between the LogisticCoordinators and the Administrators of both missions.

When ordering to private companies abroad, the Logistics Coordinator hasto carefully verify the Incoterm used for the contract. In addition theAdministrator has to assess the feasibility and the financial charges of aninternational transfer to pay the order.

In some countries the banking system doesnt permit all payments, in thatcase the payment has to be initiated by Paris Headquarters.



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6 - Filing and archiving

Documents related to orders have to be archived and kept on the missionduring 4 years.

6.1 In the bases

Project IOF folder:One folder per programme or department/ ServiceThe Internal Order Forms are classified by chronological

order.The order follow up is archived inside the same folder.

Capital order folder: Internal Order Forms to the Capital are archived bychronological order with the capital order follow upinside the same folder.

6.2 In the capital

Project IOF folder: One folder per programme or department/ Service

The Internal Order Forms are classified by chronologicalorder.

The order follow up is archived inside the same folder.

Field order folder:Internal Order Forms from the different field bases arefiled by chronological order with the order follow up fromthe Capital to the bases.One folder has to be created for each base.

HOF: are archived by chronological order with the SAE orderfollow up.

If any, orders to other Action contre la Faim missions and follow-upare archived by chronological order.

7 - Standard forms within the Kit Log V2.0



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Authorised signatures En 2005.xls

Headquarters Order Form En 2005.xlsHeadquarters Order Form utilisation En 2005.doc

Internal Order Form En 2005.xlsInternal Order Form utilisation En 2005.doc

Order follow-up En 2005.xlsOrder follow up utilisation En 2005.doc

Summary of forms En 2005.xls
