Excerpt from PROFIT - ORACLE - by Alison Weiss

Handle with Care

Sound project management helps AmeriCares bring international aid to those in need.

The stakes are always high for AmeriCares. On a mission to restore health and save lives during times of disaster, the nonprofit international relief and humanitarian aid organization delivers donated medicines, medical supplies, and humanitarian aid to people in the U.S. and around the globe. Founded in 1982 with the express mission of responding as quickly and efficiently as possible to help people in need, the Stamford, Connecticut-based AmeriCares has delivered more than US$10.5 billion in aid to 147 countries over the past three decades.

“It’s critically important to us that we steward all the donations and that the medical supplies and medicines get to people as quickly as possible with no loss,” says Kate Sears, senior vice president for finance and technology at AmeriCares. “Whether we’re shipping IV solutions to victims of cholera in Haiti or antibiotics to Somali famine victims, we need to get the medicines there sooner because it means more people will be helped and lives improved or even saved.”

Ten years ago, the tracking systems used by AmeriCares associates were paper-based. In recent years, staff started using spreadsheets, but the tracking processes were not standardized between teams. “Every team was tracking completely different information,” says Megan McDermott, senior associate, Sub-Saharan Africa partnerships, at AmeriCares. “It was just a few key things. For example, we tracked the date a shipment was supposed to arrive and the date we got reports from our partner that a hospital received aid on their end.”

While the data was accurate, much detail was being lost in the process. AmeriCares management knew it could do a better job of tracking this enterprise data and in 2011 took a significant step by implementing Oracle’s Primavera P6 Professional Project Management. “It’s a comprehensive solution that has helped us improve the monitoring and controlling processes. It has allowed us to do our distribution better,” says Sears.

In addition, the implementation effort has been a change agent, helping AmeriCares leadership rethink project management across the entire organization. Initially, much of the focus was on standardizing processes, but staff members also learned the importance of thinking proactively to prevent possible problems and evaluating results to determine if goals and objectives are truly being met. Such data about process efficiency and overall results is critical not only to AmeriCares staff but also to the donors supporting the organization’s life-saving missions.

Efficiency Saves Lives

One of AmeriCares’ core operations is to gather product donations from the private sector, establish where the most-urgent needs are, and solicit monetary support to send the aid via ocean cargo or airlift to welfare- and health-oriented nongovernmental organizations, hospitals, health networks, and government ministries based in areas in need. In 2011 alone, AmeriCares sent more than 3,500 shipments to 95 countries in response to both ongoing humanitarian needs and more than two dozen emergencies, including deadly tornadoes and storms in the U.S. and the devastating tsunami in Japan.

When it comes to nonprofits in general, donors want to know that the charitable organizations they support are using funds wisely. Typically, nonprofits are evaluated by donors in terms of efficiency, an area where AmeriCares has an excellent reputation: 98 percent of expenses go directly to supporting programs and less than 2 percent represent administrative and fundraising costs.

Donors, however, should look at more than simple efficiency, says Peter York, senior partner and chief research and learning officer at TCC Group, a nonprofit consultancy headquartered in New York, New York. They should also look at whether organizations have the systems in place to sustain their missions and continue to thrive.

An expert on nonprofit organizational management, York has spent years studying sustainable charitable organizations. He defines them as nonprofits that are able to achieve the ongoing financial support to stay relevant and continue doing core mission work. In his analysis of well over 2,500 larger nonprofits, York has found that many are not sustaining, and are actually scaling back in size.

“One of the biggest challenges of nonprofit sustainability is the general public’s perception that every dollar donated has to go only to the delivery of service,” says York. “What our data shows is that there are some fundamental capacities that have to be there in order for organizations to sustain and grow.”

York’s research highlights the importance of data-driven leadership at successful nonprofits. “You’ve got to have the tools, the systems, and the technologies to get objective information on what you do, the people you serve, and the results you’re achieving,” says York. “If leaders don’t have the knowledge and the data, they can’t make the strategic decisions about programs to take organizations to the next level.”

Historically, AmeriCares associates have used time-tested and cost-effective strategies to ship and then track supplies from donation to delivery to their destinations in designated time frames. When disaster strikes, AmeriCares ships by air and generally pulls out all the stops to deliver the most urgently needed aid within the first few days and weeks. Then, as situations stabilize, AmeriCares turns to delivering sea containers for the postemergency and ongoing aid so often needed over the long term.

According to McDermott, getting a shipment out the door is fairly complicated, requiring as many as five different AmeriCares teams collaborating together. The entire process can take months—from when products are received in the warehouse and deciding which recipients to allocate supplies to, to getting customs and governmental approvals in place, actually shipping products, and finally ensuring that the products are received in-country.

Delivering that aid is no small affair. “Our volume exceeds half a billion dollars a year worth of donated medicines and medical supplies, so it’s a sizable logistical operation to bring these products in and get them out to the right place quickly to have the most impact,” says Sears. “We really pride ourselves on our controls and efficiencies.”

Adding to that complexity is the fact that the longer it takes to deliver aid, the more dire the human need can be. Any time AmeriCares associates can shave off the complicated aid delivery process can translate into lives saved. “It’s really being able to track information consistently that will help us to see where are the bottlenecks and where can we work on improving our processes,” says McDermott.

Setting a Standard

Productivity and information management improvements were key objectives for AmeriCares when staff began the process of implementing Oracle’s Primavera solution. But before configuring the software, the staff needed to take the time to analyze the systems already in place. According to Greg Loop, manager of database systems at AmeriCares, the organization received guidance from several consultants, including Rich D’Addario, consulting project manager in the Primavera Global Business Unit at Oracle, who was instrumental in shepherding the critical requirements-gathering phase.

D’Addario encouraged staff to begin documenting shipping processes by considering the order in which activities occur and which ones are dependent on others to get accomplished. This exercise helped everyone realize that to be more efficient, they needed to keep track of shipments in a more standard way.

“The staff didn’t recognize formal project management methodology,” says D’Addario. “But they did understand what the most important things are and that if they go wrong, an entire project can go off course.”

Before, if a boatload of supplies was being sent to Haiti and there was a problem somewhere, a lot of time was taken up finding out where the problem was—because staff was not tracking things in a standard way. As a result, even more time was needed to find possible solutions to the problem and alert recipients that the aid might be delayed.

“For everyone to put on the project manager hat and standardize the way every single thing is done means that now the whole organization is on the same page as to what needs to occur from the time a hurricane hits Haiti and when a boat pulls in to unload supplies,” says D’Addario.

With so much care taken to put a process foundation firmly in place, configuring the Primavera solution was actually quite simple. Specific templates were set up for different types of shipments, and dashboards were implemented to provide executives with clear overviews of every project in the system. AmeriCares’ Loop reports that system planning, refining, and testing, followed by writing up documentation and training, took approximately four months.

The system went live in spring 2011 at AmeriCares’ Connecticut headquarters. While the nonprofit has an international presence, with warehouses in Europe and offices in Haiti, India, Japan, and Sri Lanka, most donated medicines come from U.S. entities and are shipped from the U.S. out to the rest of the world. In addition, all shipments are tracked from the U.S. office.

AmeriCares doesn’t expect the Primavera system to take months off the shipping time, especially for sea containers. However, any time saved is still important because it will allow aid to be delivered to people more quickly at a lower overall cost. “If we can trim a day or two here or there, that can translate into lives that we’re saving, especially in emergency situations,” says Sears.

A Cultural Change

Beyond the measurable benefits that come with IT-driven process improvement, AmeriCares management is seeing a change in culture as a result of the Primavera project. One change has been treating every shipment of aid as a project, and everyone involved with facilitating shipments as a project manager. “This is a revolutionary concept for us,” says McDermott. “Before, we were used to thinking we were doing logistics—getting a container from point A to point B without looking at it as one project and really understanding what it meant to manage it.”

AmeriCares staff is also happy to report that collaboration within the organization is much more efficient. When someone creates a shipment in the Primavera system, the same shared template is used, which means anyone can log in to the system to see the status of a shipment. Knowledgeable staff can access a shipment project to help troubleshoot a problem. Management can easily check the status of projects across the organization. “Dashboards are really useful,” says McDermott. “Instead of going into the details of each project, you can just see the high-level real-time information at a glance.”

The new system is helping team members focus on proactively managing shipments rather than simply reacting when problems occur. For example, when a container is shipped, documents must be included for customs clearance. Now, the shipping template has built-in reminders to prompt team members to ask for copies of these documents from freight forwarders and to follow up with partners to discover if a shipment is on time. In the past, staff may not have worked on securing these documents until they’d been notified a shipment had arrived in-country.

Another benefit of capturing and adopting best practices within the Primavera system is that staff training is easier. “Capturing the processes in documented steps and milestones allows us to teach new staff members how to do their jobs faster,” says Sears. “It provides them with the knowledge of their predecessors so they don’t have to keep reinventing the wheel.”

With the Primavera system already generating positive results, management is eager to take advantage of advanced capabilities. Loop is working on integrating the company’s proprietary inventory management system with the Primavera system so that when logistics or warehousing operators input data, the information will automatically go into the Primavera system. In the past, this information had to be manually keyed into spreadsheets, often leading to errors.

Mining Historical Data

Another feature on the horizon for AmeriCares is utilizing Primavera P6 Professional Project Management reporting capabilities. As the system begins to include more historical data, management soon will be able to draw on this information to conduct analysis that has not been possible before and create customized reports.

For example, at the beginning of the shipment process, staff will be able to use historical data to more accurately estimate how long the approval process should take for a particular country. This could help ensure that food and medicine with limited shelf lives do not get stuck in customs or used beyond their expiration dates.

The historical data in the Primavera system will also help AmeriCares with better planning year to year. The nonprofit’s staff has always put together a plan at the beginning of the year, but this has been very challenging simply because it is impossible to predict disasters. Now, management will be able to look at historical data and see trends and statistics as they set current objectives and prepare for future need.

In addition, this historical data will provide AmeriCares management with the ability to review year-end data and compare actual project results with goals set at the beginning of the year—to see if desired outcomes were achieved and if there are areas that need improvement.

It’s this type of information that is so valuable to donors. And, according to York, project management software can play a critical role in generating the data to help nonprofits sustain and grow.

“It is important to invest in systems to help replicate, expand, and deliver services,” says York. “Project management software can help because it encourages nonprofits to examine program or service changes and how to manage moving forward.”

Sears believes that AmeriCares donors will support the return on investment the organization will achieve with the Primavera solution. “It won’t be financial returns, but rather how many more people we can help for a given dollar or how much more quickly we can respond to a need,” says Sears. “I think donors are receptive to such arguments.”

And for AmeriCares, it is all about the future and increasing results. The project management environment currently may be quite simple, but IT staff plans to expand the complexity and functionality as the organization grows in its knowledge of project management and the goals it wants to achieve. “As we use the system over time, we’ll continue to refine our best practices and accumulate more data,” says Sears. “It will advance our ability to make better data-driven decisions.”