Does the Current Constraints in Funding Promote Failure in Humanitarian Supply Chains?

Traditionally, most funding is made available when a disaster occurs. Disaster response is the implementation of what humanitarian actors did (or didn’t do) in preparedness for any intervention. Based on a case study of a logistics change in the International Federation of Red Cross Red Crescent Society, this paper discusses how more funding of preparedness can radically improve the speed and quality of response. Findings contribute to our understanding of how changes in funding can improve and support faster recovery due to increased preparedness in disaster- prone areas. Illustrating how postponement/speculation logistics strategies are applied to flows of material, information, and human resources, it is concluded that associated changes of financial flows are required. Donors and NGOs must think of more ‘speculative’, long-term, and unearmarked funding with particular attention to risk sharing, cost recovery, and measurements. This paper contributes to further understanding of postponement/speculation in project-based settings (temporary supply networks), how funding and logistics (payment and materials flows) are related, as well as the present funding models′ implications for efficiency and effectiveness in humanitarian aid. These are all areas that have been underresearched.