Indian Ocean Tsunami Impacts Supply Management

FOR RELEASE: February 22, 2005

CONTACT: Jean McHale
  ISM Public Relations
  800/888-6276 ext. 3143

TEMPE, Ariz. — The death and destruction from the Indian Ocean earthquake and tsunamis have touched the entire world. In addition to the personal sadness and loss of life, some of those in supply management are directly involved in relief efforts as well as alternate sourcing and handling logistics challenges.

Institute for Supply Management™ (ISM) recently surveyed 4,000 supply management professionals to determine the direct impact on supply management. A little more than half of the respondents were from the non-manufacturing sector and employed by companies with more than 1,000 employees. With a response rate of 10.7 percent, the survey results have a margin of error of 5 percent.

Approximately 54 percent of those surveyed indicate their company is involved in responding to the disaster with operational and/or humanitarian efforts. The vast majority of those are involved in organized fund-raising events or making financial contributions. Some are also involved in providing supplies and logistics services. As one respondent said, "Supply chain management and logistical support are critical to the success of the relief effort."

"Norwalk Hospital, in cooperation with Americares, sent Jonathan Fine, M.D., to assist with medical needs assessments," states Gregory Arakelian, director of purchasing for Norwalk Hospital in Norwalk, Connecticut. "In addition, Norwalk Hospital assisted employees in raising personal contributions to Americares or the philanthropic organization of their choice to benefit tsunami humanitarian efforts."

The worldwide impact of the tsunamis illustrates the interconnectedness of the global supply system. Approximately 17 percent of the survey respondents indicate their employees, suppliers, consultants and/or contractors were directly affected by the disaster. Many of those 17 percent have families of employees or employees themselves suffering with human losses. A few indicate they are still missing employees who were in the affected areas at the time of the disaster. As one person responded, "Many colleagues remain missing."

As for the business impact beyond the loss of life, approximately 7 percent of respondents indicate an impact on the company supply chain. Transportation and logistics interruptions account for half of the 7 percent with sourcing/supply challenges accounting for about a third of them.

"Considering today's global reach of supply chain management, a disaster anywhere in the world truly touches us all," states Paul Novak, C.P.M., A.P.P., chief executive officer of ISM. "With the strategic role of supply management professionals in the delivery of goods and services every day, they are not only in a position to ensure business operations continue, they also have a critical role in providing much needed assistance when disaster strikes."

As the oldest and largest supply management institute in the world, the mission of the Institute for Supply Management™ (ISM) is to lead supply management. ISM defines supply management as the identification, acquisition, access, positioning and management of resources the organization needs or potentially needs in the attainment of its strategic objectives. By executing and extending its mission through education, research, standards of excellence, influence building and information dissemination — including the renowned monthly ISM Report On Business® — ISM continues to extend the global impact of supply management. ISM's membership base includes more than 40,000 supply management professionals in 75 countries. Supply management professionals are responsible for trillions of dollars in the purchases of products and services annually. ISM is a member of the International Federation of Purchasing and Supply Management (IFPSM). Visit ISM's Media Room at, Quick Search: QS130

Back to Top