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in Aceh, Indonesia
Kelvin Zuo, Suzanne Wilkinson Department of Civil and Environmental Engineering, The University of Auckland, New Zealand (Email: s.Wilkinson@auckland.ac.nz , firstname.lastname@example.org ) Regan Potangaroa, School of Architecture, Unitec, Auckland, New Zealand. (Email: email@example.com )
In order to accommodate the growing complexity of construction process, various management systems and methods have been developed through academic research and applied in industry practices. Among those, supply chain management (SCM), as a significant component in construction material procurement, becomes increasingly popular, especially within the context of broader cooperation, vertical disintegration and the viewpoint of a networked supply chain in the construction industry. Following the Boxing Day Tsunami in 2004, the procurement and supply of sustainable and legitimate construction material for the massive reconstruction became the first priority of almost every organisation involved in this process in Indonesia. As a result, the competition for limited resources and the lack of effective coordination between reconstruction agencies has nearly tripled the cost of a standard house and leaving thousands of people in transit living conditions two years after the disaster. Based on the reconstruction experience in the worst affected area, Banda Aceh, this paper will examine the modern literature on supply chain management (SCM) and analyse this process in practice associated with construction material procurement, review the problems inherited in the Indonesian context and analyse the proposed procedures of local and international procurement of construction materials to streamline the supply. Conclusions will then be made based on abovementioned analysis for future development and adoption of an integrated SCM concept in post disaster reconstruction. Keywords: Supply Chain Management, procurement, disaster reconstruction, Tsunami, Aceh
1. Literature review
1.1 SCM Literature Overview
In order to accommodate the growing complexity of construction process, various management systems and methods have been developed in academic researches and well applied in industry practices. Among those, supply chain management (SCM) becomes increasingly popular; this especially within the context of broader cooperation, vertical disintegration and the viewpoint of a
1. information and services processing links with the characteristics of supply. to discuss an alternative organizational form to vertical integration (Hakansson and Snehota 1995). 1991. will be covered in this literature review. Figure 1: A typical supply chain model (Chen and Paulraj. Besides its initial interests gathered to explain the logistics activities and the control of materials and information flows. notions of materials management and integrated logistics (Carter and Price 1993). transformation and demand”. and influential industry-specific studies (Womack et al. A typical supply chain is illustrated in the following model developed by Chen and Paulraj (2004) as “simply a network of materials.2 Supply Management Overview & Communication Needs A predominant approach to SCM research is the so-called ‘supply management’. However. ‘Supply chains’. The term SCM was originally introduced by consultants in the early 1980s (Oliver and Webber 1992) mainly focused on the lines of physical distribution and transport and has subsequently gained tremendous attention (La Londe 1998). Harland et al. 2002) within the process. Its popularity has been stimulated by a range of sources including the quality revolution (Dale et al. Since suppliers 1117 . ‘demand pipelines’.networked supply chain in construction industry. only some critical elements of SCM and its performance measurement. information systems management and operations management. logistics and transportation. 2004) The main body of SCM literature has been explosively enlarged during the latter half of last century due to its various contributing knowledge fields such as purchasing and supply. and to address the purchasing and supply perspective (Farmer 1997). network. 1994). strategic management. ‘support chains’ are some examples of the terms used to describe this process. organisational behaviour. which emphasizes primarily the buyer-supplier relationship (Leenders et al. marketing. a growing interest in industrial markets and networks (Ford 1990. Jarillo 1993). Lamming 1993). which are relevant to the current process of post-disaster reconstruction in Aceh. to identify and describe the relationship a company develops with its suppliers (Narus and Anderson 1995). ‘value streams’. researchers have also explored into other areas such as strategic. 1999). inter-organizational issues (Cox 1997.
Kekre et al. Krause 1999.e. (1983) compared the potential costs associated with different sourcing strategies and suggested that companies would gain benefits by placing a larger volume of order with fewer suppliers using long-term contracts. This is partially due to the consideration of risk reduction with multiple options and avoidance of becoming source dependent.3 Supplier Base Reduction and Long-term Relationships Traditional practices of supply chain management tend to contract with multiple suppliers even for the same material or component. 2000). Stuart 1993). This is a major problem experienced by various agencies involved in the Aceh reconstruction and embodied in competition for resources and increased difficulty in materials procurement. because the administrative or transaction costs associated with managing a large number of vendors often outweigh the benefits (Dyer 2000). 1999). 1990. which undermined the buying firm’s efforts to achieve increased levels of supplier performance (Lascelles and Dale 1989). buyers and suppliers must commit a greater amount of information and be willing to share sensitive design information. A wellcoordinated joint order of similar construction materials by several NGOs would be a good example of sustainable management of such practice. reduction of the supplier base is a unique characteristic of contemporary buyer–supplier relationships (Newman 1988. Through close relationships. quality. Turnbull et al. 2003). Carr and Pearson 1999 argue that in order to jointly find solutions to material problems and design issues. 1992). Long-term relationships between supplier and buyer have become a crucial characteristic of modern supply chain relationship (Shin et al. The literature on SCM has constantly emphasized the importance of effective two-way communication to the above relationship. The benefits attributed to this practice often exceed those achieved through traditional bidding from multiple sources. the management of relationships with other members of the supply chain (i. manufacturability and performance without affecting profit margins (Bhote 1987. this is often achieved through engineer-to-engineer communication on design issues keeping in mind to improve process capability. 1995). Galt and Dale 1991. Moreover. Dobler et al. Ittner et al. Selecting suppliers for specific goods and services is a critical decision for most organizations. Poor communication was often a fundamental weakness in the interface between a buying firm and its supplier. Hahn et al. 1990. since supply performance can have a direct financial and operational impact on the business (Bailey et al. supply chain partners are willing to share risks and reward and maintain the relationship over a longer period of time (Cooper and Ellram 1993. which often emphasizes low price at the expense of performance (Mohr and Spekman 1994). However. Many firms are reducing the number of primary suppliers and allocating a majority of the purchased material requirements to a single source (Pilling and Zhang 1992. Choi and Hartley (1996) found that companies place more importance on consistency (quality 1118 . supply base consolidation sets the stage for future development of the chosen suppliers (Handfield 1993). 1994. Kotabe et al. Helper 1991). A quality focus in supply management is supported by many conceptual studies. 2004). 1. However. buyer–suppler relationship) is increasingly being referred to as SCM (Chen and Paulraj. through a long-term relationship. This is especially the case in the Aceh reconstruction given the limited availability of construction materials and often inadequate administrative abilities of reconstruction agencies. time and responsiveness of the buying firms. Hahn et al. the supplier will become part of a well-managed chain and will have a lasting effect on the competitiveness of the entire supply chain (Choi and Hartley 1996. Moreover.have a profound and direct impact on cost.
Lewis 1995). Besides the supplier integration. (1992) found supplier involvement to be an important part of the strategy in five out of the six firms they examined who were attempting to collapse new product development time. warehousing. The involvement may range from giving minor design suggestions to being responsible for the complete development. Primo and Amundson 2002). and characteristics that imply ‘fair dealing’ are also considered with importance in selecting the supplier (Anderson and Narus 1990. on-time delivery. other internal and external integration issues in supply chain logistics are recognized and attracting more and more interest from researchers. Busch 1988. quality and production can be screened out. quality. services and related information as they travel from the point of origin to the point of consumption (Chen and Paulraj. design and construction of a specific part of the building (Wynstra and Pierick 2000). integrity. It involves the thorough examination of all aspects of a vendor’s performance and is expected to enhance buyer–supplier trust and communication. 1995. American Quality Foundation and Ernst and Young (1998). According to reports by Naumann and Burton in 1980’s. 1999). commitment. research has concluded that the effective integration of suppliers into new product development can yield such benefits as reduced cost and improved quality of purchased materials. 1. reduced product development time. Ittner et al. 1970. 1997. supplier certification has been extended to include the logistics function. reported that formal programs for certifying suppliers showed an across-the-board beneficial impact on performance. because willingness to share information is viewed as a signal of the trustworthiness of the supplier (Dyer 1997). External integration has been the subject of a good deal of research in logistics management. and improved access to and application of technology (Ragatz et al. implementing and controlling the efficient flow and storage of goods. Studies by Mabert et al. A recent trend of supplier certification provides a potential solution to the procurement problems related to selection of tenders.4 Supplier and Logistics Integration Integration is another key word in SCM involving the new building construction process. production planning and distribution in order to carry out a unitary process (La Londe et al. Larson and Kulchitsky 1998. 2002. suppliers accounted for approximately 30% of the quality problems and 80% of product lead-time problems. Specifically. and uninterrupted supply become critical selection criteria because supplier failures on these dimensions have more serious adverse effects on the buyer’s operations (Ellram 1990). Recently. The traditional approach of logistics integration across functional boundaries within a firm is termed ‘internal integration’ (Bowersox and Daugherty 1987). Furthermore.and delivery) and the least importance on price. Logistics has traditionally been defined as the process of planning. Trustworthiness. the name underlines the needs for mutual completion of procurement. in their international quality study of over 500 organizations. to improve supplier product quality. Enterprise logistics integration is the extent to which a firm implements both internal and external integration. Stock et al. and to reduce inspection and inventory costs for the buyer (Schneider et al. 2004). purchasing and distribution. whereas a more recent approach of logistics integration across firm boundaries is termed ‘external integration’ (McGinnis and Kohn 1990. to reduce communication errors. La Londe and Powers 1993). especially in quality and productivity. Some major activities included in the logistics domain include transportation. On the whole. suppliers who are unwilling to share information on cost. It can be 1119 . 1998).
Data collected and ideas generated from this series of interviews and pilot case studies were incorporated and expressed in the discussions within the following sections.5 and official donors 1. These consequent tragedies caused immense economic. social and environmental devastation to Aceh and surrounding areas that were already under the poverty line. NGOs 1. 4 months after the Tsunami. another big earthquake on March 28 2005 added 1. There are approximately 290 NGOs and donor organizations operating in Aceh and Nias in 2006 managing as many as 828 projects. supplier base reduction. Major obstacles associated with construction materials procurement were identified during interviews. let alone the accompanying tremendous reconstruction of infrastructure. members from local Village Development Committee and affected communities. namely. communication needs.1.000 remain missing.4 billion1 has already been allocated to different projects. extensive interviews were carried out with construction managers. 1120 . It is estimated that at least US$5.8 billion will be needed in the recovery phase for Aceh and Nias. the Agency of the Rehabilitation and Reconstruction for Aceh and Nias (BRR) was established by Indonesian Government Regulation No. Several recommendations were made in the conclusion to tackle the problems encountered in post-disaster procurement and to streamline the supply chain for reconstruction. as well as integration of the firm’s logistics activities with the logistics activities of other supply chain members (Stock et al. representatives from local authorities overseeing the reconstruction process in Aceh. The situation now is that US$4. Simeulue and southern coastline of Aceh. During the fieldtrip. 2. relocation and resettlement of Acehese tsunami victims.300 to the death toll in Nias. procurement managers from different NGO’s and UN agencies. Supply chain and material procurement experiences in the Aceh Tsunami reconstruction During the 2004 Boxing Day Tsunami. 3. In order to generally coordinate and manage the reconstruction effort in an overall prospective. and supplier and logistics integration.8 billion in US dollars. some 130. 1998). long-term relationship. and the people of Aceh and Nias may have a chance to better build back their 1 US$4. 2006) that approximate 123. Those topics would later be addressed and referred to in case experiences discussions.000 new houses are needed for re-establishment. focusing on several aspects closely related to the post disaster procurement process in Banda Aceh.characterized by integration of logistics activities across functional departments within the firm.000 people were killed in Aceh alone and 37. and local staff in those NGO’s.4 billion: The Government of Indonesia has allocated 1. 2/2005 on 28 April 2005. Two authors of this paper spent a monthly fieldtrip in Banda Aceh 2 years after the Tsunami with the Indonesian branch of an international humanitarian aid organisation involved in the houses reconstruction project for local refugees. Methodology The methodology used in this research includes firstly a comprehensive review through the modern literature of SCM. 3 months later. Two typical methods representing local and international supply chains for timber procurement were selected out for detailed analysis. It is estimated in an official report (BRR April.
340. this term is used to describe a consortium of government officials. In spite of a moratorium on logging in Aceh implemented pre-Tsunami. the number of illegal payments experienced a significant decline in last 3 months associated with the pull-out of troops and police from Aceh province mandated by the Helsinki peace agreement. It is estimated in a recent survey (BRR and The World Bank 2006) conducted by BRR and The World Bank that bribes and illegal payments that truck drivers pay on the Banda Aceh . it has not been without delays and the quality in some cases has been questionable. especially the massive needs of timber. Indonesian Ministry of Forestry decided to restore forest concession (HPH) to 11 companies in Aceh to enable them to supply timber needed for the Aceh reconstruction and agreed to increase timber quota for Aceh to 400. One can easily visualize the beautiful green land under the plane when flying over the Sumatra Island. extensive illegal logging is currently taking place in Aceh forests. 1121 . On the other hand. are reluctant to cater for the needs in Aceh due to high cost of transportation and the complicated process of applying for legal documents (i. The major issue is becoming how to spend this money wisely and in the most needed areas. Government of Aceh realized the tremendous needs for legal timber supply within the area.000 on average (single trip on either direction).” A review and general introduction of timber supply problems inherited in the Indonesian context will first be made. this is usually referred as related to a so-called “Timber Mafia” situation. This not only constitutes a major cost for timber transportation but also has negative influences to potential timber dealers from outside provinces.e. Problems in getting legal and sustainable timber supply for reconstruction are frustratingly experienced by almost every agency over the past year and this situation could continue for longer. 70% of mainland Aceh is still covered by natural tropical forests. police. followed with the analysis of the possibility and proposed procedure of procuring local and international timber. SKSHH) to facilitate the transportation.1 Timber supply problems Although seriously damaged during 2004 Tsunami in coastal areas. This is also supported by the Ministry of the Environment. As mentioned in a NGO’s report on supply chain management. such as Riau and Kalimantan. 3. This decision had to be made since timber suppliers from other provinces. state officials and preman (criminal) groups at various security posts and weigh stations are Rp. At the end of 2005.000 cubic meters for 2006. However. “whilst timber has been previously procured.Medan road to corrupt police. The acting Governor is in favour of a “Green Aceh” with no logging and supporting WWF and other conservation NGOs’ programmes promoting the use of imported timber from sustainably managed forests for reconstruction. The Government of Aceh (represented by BRR regarding reconstruction) is reviewing its timber policy in light of the Tsunami and the need for timber for recovery. businessmen. army. military.livelihood with total pledges of US$9 billion (3 billion more than least budget required). A major problem faced by almost every organization involved in the Aceh reconstruction is the supply and procurement of legal and sustainable construction materials. It is the natural gift inherited by generations of Indonesian people but now forced “open for exploitation” (Indonesia-Relief News). etc who allegedly conspire together to gain large profits from the illegal logging of the forest estate. the best remaining tropical forests in Indonesia and rich in biodiversity.
such as the legitimacies of importing timber and associated timber treatment methods. 2006). which several days later was reduced to a list of 5 and handed out to local project managers during another local staff meeting. These were only recommended as reliable and not guaranteed as legal. The procedure followed in each will be introduced and generally reviewed: 3. 3.2.There are other specific problems in timber procurement in Aceh. A list of 25 local timber supplier companies approved by BRR was given to representatives from various NGO’s during a BRR’s timber policy meeting in July 2006. which could only be explained as internal uncertainty and inconsistency with Indonesian timber policies or failure in execution of established standard regulations. 1122 . or at least non-illegally and non-unsustainably. It is partially due to confused and sometimes conflicting information from different government sources. timber for Aceh reconstruction is still procured legally and sustainably. It is almost impossible for any organisation to take on such a big risk (even one piece of illegal timber will result in the whole package being confiscated) and continue operating.2 Timber procurement procedures In spite of these difficulties. from some sources to some organisations. All of them can be categorized either as locally supplied or internationally imported/donated.1 International timber procurement A flow chart of international timber procurement procedure has been developed as below based on an introductory paper of suggested purchase flow prepared by Ralph Douglass from British Red Cross (Douglass July. The responsibility of ensuring legality of procurement with those companies remains on NGOs’ shoulders.
Air Bill or Bill of Lading (B/L) as a substitute for other documents but only possible for a temporary period 1123 . Invoice b. almost no suppliers will start purchasing logs or initiating production without a satisfactory ILC confirmed by their bank first. Packing list c. Request for 3. thus a and confirm intent by issuing contract relationship is a purchase order formed 2 the basis and payment terms of international timber trade. Phytosanitary certificate from port of loading d. ship at arrival port (Belawan. notify successful tenderer Proforma Invoice (2c). to bid Proforma Invoice 4. Technical potential suppliers and invite detailed Bill of Quantities specification schedule. b.2. the Irrevocable Letter of Credit (ILC)2 prepared by purchaser’s bank accepted and confirmed by supplier’s bank using the information in Proforma Invoice (2c) 8. c.production initiated 11. ILC payment and documents exchanges occur 13. submission of bids and tenders evaluation 7. shipping schedule 10.send above documents to 1.following logistics from clearance. prepare house design and Quotation. phytosanitary etc. shipping documents3 sent on the basis of being a organised and notified to the to the purchaser by the registered tsunami purchaser by the supplier supplier on port of departure reconstruction programme in Aceh 12. 3 including documents of clearance of goods through customs and quarantine requires: a. prepare purchase documents: a. purchaser or its shipping agent arranges customs pre14. purchaser applies to the BRR for tax free gift status 9.successful tenderer accepts the offer and submits a 5. using the shipping Medan) to final destination documents and support letter from BRR Table 1: Flow chart of international timber procurement procedure for Aceh reconstruction 6.
further contribute to the unpopularity of international timber procurement in Aceh. The supply chain is simplified and bureaucratic process of applying SKSHH4 and other legal documents from the Government of Aceh could be avoided. A large order of timber. only valid per truck per travel 1124 . Timber is a natural product that must be kept dry and out of direct sunshine if possible. some disadvantages are obvious and make this option less attractive when decisions are made at an individual organisational level. Besides the higher prices. could be streamlined and procured at a lower price. while local timber prices are usually within USD$350 – 550/m3 from legal sources. Storage of a large amount of international timber is another problem because of the associated demurrage charges that are extremely expensive if the shipment has to be left at the port. treatment and processing options. The uncertainty of legitimacies within the Indonesian context related to imported timber. there are several advantages of importing timber for the Aceh reconstruction.Imported timber from New Zealand or Canada using the above procedures has usually been treated as a Hazard Class H3. It has an internationally recognized guarantee of sustainable management and production of timber with other internationally recognized 3rd party certification and audit of treatment standards. together with issues related to donation and standard treatments required. The required amount of timber is limited at each time of procurement thus the large availability of international sources is no longer an advantage. Thus the warehousing facilities are essential in the logistics of transporting timber from port to construction site. The first advantage is the longer and guaranteed durability and protection from weather changes and insects and fungi attack under Indonesian conditions.000 m3/month if long term orders are placed) while uncommitted local supply is limited to approximate 1/10 of that from international sources.1 standard for an above ground application. Most importantly.000 – 40. then subdivided into small packages with only several hundreds cubic meters each and procured once in a while creates a longer and complicated timeline. one tree from local tropical forests could been saved. The prices range from USD$420-590/m3 CIF (Cartage. Another advantage is the large amount available (30. while local timber could be delivered to the site at vendor’s expenses as required each time. Insurance and Freight) at Medan depending on required grade. This is partially due to the lack of overall supply chain management and communications between procurement and project teams. for every log sourced internationally for use in Aceh. Although the price is understandably higher than the local one. 4 a legal document for cross-provinces timber transportation in Indonesia. The specific treatment method is LOSP (Light Organic Solvent Preservative) rather than CCB and CCF used in Indonesia. certificate of origin and chain of custody. However. longer delivery schedules (at least 4-6 weeks. but generally believed as 10 weeks) often excludes it as an option.
this flowchart could also be used as a guideline for local timber procurement and associated logistics. Supplier (SKSHH) Coordination Flow: Structural Flow: Table 2: Local Timber Procurement Suggested Procedure from BRR Although aiming at providing recommendations for timber transportation. SKSHH appears many times within the flowchart. it is a set of documents used to define the legality of timber and it is required when the log is transported from the concession companies to the industry or when semi-wood products are ready to be marketed and transported to their final destination. suppliers.2 Local timber procurement Similarly. Institutions) Timber Help Desk (Cross check SKSHH) & Tim Terpadu (recommendation for transportation) Logistic Unit (Consultation / advise) Infrastructure Unit (Project clarification and validation) WFP SS Documents of goods: -SKSHH -Recommendation letter -Port clearance etc.3. the most important interface to users.2. NGOs. There are some terms used only in Indonesian timber industry that are worth explaining. Timber Helpdesk was designed by BRR in order to address timber issues for reconstruction and rehabilitation in Aceh and Nias. It is worth noting that SKSHH is not required for imported and donated timber. The big circle in the flowchart represents Timber Helpdesk and Tim Terpadu in BRR headquarter. in order to understand the local timber procurement procedure. as explained in footnotes before. shipping agencies and other departments in Government of Aceh. 1125 . It has a dual role to facilitate the demand and supply of timber and to monitor the timber used for reconstruction within this region. a flowchart developed and handed out as a suggested guideline by BRR is attached below: Procedure for obtaining recommendation of timber transportation Program Rehabilitation and Reconstruction NAD-NIAS Chief operation officer (COO) Housing Unit (Project clarification and validation) Users (Agencies.
It is recommended that all the timber bidders for the Aceh reconstruction are required to provide valid forestry permits as well as SKSHH as a pre-qualification for tender. Legal timber as defined in a BRR guideline (BRR July. The transporter recommended by BRR to reconstruction agencies in Banda Aceh is the shipping services provided by WFP (World Food Programme). 5 Project Concept Note should be approved beforehand by BAPEL BRR. In order to process this request. 2006). Photocopies of the user’s Project Concept Note5 and the Contract in previous step are required in order to issue the recommendation letter. demonstrated below: Table 3. Institutions) Contract Timber Supplier (list of 25 registered suppliers) Letter of Recommendation Contract Timber Transporter (WFP SS or other shipping agencies) Timer Help Desk (Tim Terpadu. Overall. it is important that timber users understand the definition of legal timber and the assurance measures in obtaining only legal timber. Agencies.Typical Procurement Procedure for local timber supply As can be seen from above table. The user can purchase timber or timber products directly from merchants.A typical procedure for local timber procurement could be categorized into 3 steps with different relationships between timber user/ purchaser and other involved parties. BRR) potential supplier based on the names registered with BRR in step 1. Then in step 3. the user moves to step 2 and submits a request to Timer Help Desk or directly to Tim Terpadu in BRR for a Letter of Recommendation to purchase timber. Tim Terpadu has to check with its Housing Unit and/ or Infrastructure Unit for the project clarification and validation to make sure that the user is permitted to order timber and that the amount and type of timber requested is in accordance with their needs (see flowchart in Table 3). Then the classical tendering process needs to be completed within this step and an agreement or formal contract needs to be entered into with the preferred supplier. Legal concession is a legal timber company that holds a permit for forest utilization from the Ministry of Forestry. but the responsibility for obtaining legal timber remains that of the user. in order to procure local timber. the user has to contact a Timber User(NGOs. means that the timber is harvested from legal concessions in accordance with national regulations. 1126 . the executing agency. After this. the user has to provide photocopies of documents gained from step 1 and 2 (Contract and Letter of Recommendation) together with an order request to the timber transporter and enter into another contract for transportation.
The high price is partially because the steel roof systems commercially available now are in mass production. while its relatively soft inner core is suitable for cladding. windows. this is moe easily said than done. palmwood is free from knots. Another advantage is that the coconut palm is branchless. harder part of coconut trees is used in structural materials for building construction. flooring/decking and furniture design. but this shortfall could be reduced if less steel is needed for a roof than the amount of timber needed for a timber truss. the outer. People are more conservative in remote areas and it is still unclear whether they are willing to move into a “light and shining” steel roof house. In recent years people have recognized and explored the potential use of this vast. The current coordinating agency BRR has growing power and may be able to do this for its prefabricated houses in the future. since more and more research results and real life experiences in favour of this option become available internationally. doors and ventilation frames or coconut trees as structural component as replacements to timber products. However. This will require a significant amount of on-site community participation and socialization beforehand. alternative supply of timber and found that it performs as well as or even better than traditional hardwoods. The pricing of steel roofs for Tsunami relief houses could be significantly reduced if all the reconstruction agencies with the same intention in Aceh organize their individual requests into a bulk order and choose both local and international companies with reliable reputations for a competitive tender for mass production.3. Those alternative methods and suggestions include using steel trusses (or steel high-pitch roof). especially in Banda Aceh coastal area. a steel high-pitch roof requires much less steel in volume than a traditional timber truss roof. They usually come from farmed plantations of old coconut trees and really are an enormous source of timber that until now have been a wasted by-product from the fruit and food industry. as an ecological substitute to endangered and limited hardwoods. The mass production of coconut timber in Aceh remains a good theory. Another concern about the use of steel trusses is the acceptance by the community. These could be used as profitable by-products for the milling workshop owners if mass production of coconut timber for construction is feasible in Aceh in the near future. it is a good opportunity to explore this idea further in Aceh using a government or community-based initiative to cater the massive needs for timber. mainly cater for the needs as factory storage and heavy industry buildings.3 Review of other options Alternatives to limited timber supply and other options for sourcing materials for construction are explored and reviewed by organisations involved in the Aceh reconstruction. Coconut trees as another source for timber as “palmwood” is a relatively new process but has huge potential to ease the pressure on the world’s rainforests. Several factors may contribute to the problem. screening and homewares. The high prices associated with using steel trusses as replacements to timber are the main obstacle. It is understandable that steel is more expensive than timber. However. Actually. 1127 . which makes it an ideal timber. The issues related to the level of acceptance by the affected community and forestry authority remain. Usually.
The supply of timber offshore might provided great relieves at initial response. and different door and window frames. it would be better to have an overall procurement plan for the whole project rather than the range of small ones before starting any negotiation with potential vendors. More studies are required into the use of coconut timber. The sustainability dilemma with the use of timber is the balance between the preservation of the environment and the provision of housing. there is also the option to use shorter life span materials for doors and windows with the idea that they would need to be replaced earlier than usual (lowering quality).g.4. Integration. require timber bidders for Aceh reconstruction to provide valid forestry permits as well as SKSHH before further consideration of their tenders). It remains an attractive potential for rural areas and isolated islands when policy barriers have been removed. Furthermore. It is suggested that reconstruction agencies should seek every possible way of using local timber sources with policy clarifications and transportation suggestions from local reconstruction authority BRR. This leads into the need for alternatives such as the use of coconut timber and possible substitutions for the major uses of timber in house reconstruction. In relating to timber procurement process. steel trusses could be a back up option given the short time and high demand. The possibility of milling and use of seized timber or timber from other sources should also be investigated. Although more expensive than timber. buyers and suppliers must commit a greater amount of information and be willing to share sensitive information to achieve increased levels of supplier performance. the procedures of international and local timber supply for reconstruction in Aceh are reviewed in the paper followed by discussions on alternative ways of using steel trusses or coconut timber as solutions to the current problem. Good communication is the basis for building a long-term relationship with reliable suppliers. With a 1128 . Substitutions could be the use of light gauge steel sections. This should be encouraged in order to reduce the supplier base and minimise the administrative or transaction costs associated with managing a large number of vendors. roofing that can span without the need for timber trusses. Conclusions and recommendations The needs for improved communication between reconstruction agencies and their material suppliers are well recognized. As mentioned earlier in the SCM literature review. The use of familiar and locally available materials for reconstruction should be encouraged. This should streamline the supply in later stages and result in a better supply arrangement. Certain certificates or well-designed criteria for pre-qualification will contribute to the supplier selection process and supplier base consolidation (e. it means that the important economical "kick start" provided by aid in country (and specifically in Aceh) is lost and the aftermath are housed people in a context of greater poverty. is suggested in the Aceh reconstruction practices at both supplier and logistics levels. another key principle in contemporary SCM. but in long term. Recycling certain construction materials from damaged houses remains another possibility since most steel doors and window frames from the disaster were not seriously damaged and are in large demands. In order to facilitate the process. while exploring the legal. economic and logistic feasibility of imported timber. but hardly addressed.
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