A coherent inventory management solution for South African public healthcare facilities

Thesis (MEng)--Stellenbosch University, 2020.ENGLISH ABSTRACT: The internal pharmacy and supply chain department at healthcare facilities (hospitals and clinics) are tasked with the acquisition and distribution of stock for the entire establishment. In some cases, the physicians are responsible for quantifying the orders issued to these departments, but have little-to-no visibility of inventory data. Orders are not always delivered in full and may arrive late. Restock orders are made when inventory is still plentiful and stock regularly gets discarded due to expiring. Subject matter experts were consulted and site visits were conducted at healthcare facilities to identify the cause and effects of the inventory problems. A study was executed to define the behaviour of South Africa's healthcare supply chain and investigate the importance on minimizing cost during stock acquisition. It was found that meeting demand in healthcare is most important and the best means of diminishing cost is by reducing the number of expired items. A systematic literature review was performed to identify inventory policies created to quantify orders for healthcare facilities. Twelve inventory policies were found, of which eleven were tested by means of a simulation modeled to behave as a small public healthcare facility reliant on one hundred products. These inventory policies performed very poorly due to the very infrequent ordering schedule (review periods) and long lead times experienced in South Africa's public healthcare supply chain. All found inventory policies used the moving average forecast technique to predict the future demand. An investigation into alternative forecast methods was conducted which found the Holt's Linear Trend Method (HLT) to achieve the best results in terms of accuracy and computational runtime. The Iterative Forecast Inventory Model was created, which works by stepping through the predicted demand while considering the expected order arrivals, to estimate the lacking inventory required to meet upcoming demand. This model outperformed the inventory policies from literature, but decreasing demand trends caused the model to under-assume future demand. The HLT & ND Inventory Model was created by including a normal distribution (ND) fit of the historic demand set to calculate a minimum value for the future forecast. This model was capable of meeting all demand and minimizing the number of expired items. The target of acquiring daily inventory levels from public healthcare facilities was no longer possible, but effort is being made to capture inventory levels weekly and log all order information. The Revised HLT & ND Inventory Model was designed to estimate and use weekly demand given this degree of visibility. The model achieved promising results and the attention of subject matter experts (SMEs) whom would like to see the model further developed for real-world pilot testing. Supplier unpredictability was addressed to increase the confidence of acquiring the desired order quantities and a model was created to ensure that inventory storage capacity is not exceeded. Qualitative validation for the models developed in this report was acquired from four supply chain SMEs. The feedback was covered in-depth and concluded positive towards the work done.AFRIKAANSE OPSOMMING: Die interne apteek- en voorsieningskettingafdeling by gesondheidsorgfasiliteite doen die verkryging en verspreiding van voorraad vir die hele onderneming. In sommige gevalle is die geneeshere verantwoordelik vir die kwantifisering van die bestellings wat aan hierdie departemente uitgereik is, maar hulle het min, of geen, sigbaarheid van die voorraaddata. Bestellings word ook nie altyd volledig afgelewer nie en kan laat kom. Aankoopbestellings word soms gemaak wanneer die voorraad nog volop is en voorraad word gereeld weggegooi omdat dit verval. Onderwerpkenners (SMEs) is geraadpleeg en besoeke by gesondheidsorgfasiliteite gehou om die oorsaak en gevolge van die voorraadprobleme te identifiseer. 'n Studie is uitgevoer om die gedrag van Suid-Afrika se gesondheidsorgverskaffingsketting te definieer en om die belangrikheid van koste tydens die verkryging van voorraad te ondersoek. Daar is gevind dat die behaling van vraag die belangrikste is, en die beste manier om koste te verminder is om die vervalde items, te verminder. 'n Sistematiese literatuuroorsig is uitgevoer om voorraadbeleide te identifiseer wat geskep is om bestellings vir gesondheidsorgfasiliteite te kwanti seer. Twaalf voorraadbeleide is gevind, waarvan elf getoets is deur middel van 'n simulasie wat gemodelleer is om op te tree as 'n openbare gesondheidsorgfasiliteit. Hierdie voorraadbeleide het baie sleg gevaar as gevolg van die baie gereelde bestelrooster en lang leitye wat in Suid-Afrika se openbare verskaffingsketting vir openbare gesondheidsorg ervaar is. Al die voorraadbeleide wat gevind is, het die bewegende gemiddelde voorspellingstegniek gebruik om die toekomstige vraag te voorspel. 'n Ondersoek na alternatiewe voorspellingsmetodes is uitgevoer wat gevind het dat die Holt's Linear Trend Method (HLT) die beste resultate ten opsigte van akkuraatheid en berekeningstyd behaal het. Die Iterative Forecast Inventory Model is geskep, wat werk deur die voorspelde vraag deur te gaan terwyl die verwagte aankomste van die bestelling in ag geneem word, om die ontbrekende voorraad te skat wat benodig word om aan die opkomende vraag te voorsien. Hierdie model het beter gevaar as die voorraadbeleide uit literatuur, maar dalende vraagtendense het veroorsaak dat die model die toekomstige vraag onderskat. Die HLT & ND Inventory Model is gemaak met behulp van 'n normale verdeling (ND) wat ooreenstem met die historiese vraag wat gestel is om 'n minimum waarde vir die toekomstige voorspelling te bereken. Hierdie model is in staat om aan alle aanvraag te voldoen en die aantal items wat verval het, te verminder. Die verkryging van daaglikse voorraadvlakke was nie meer haalbaar nie, maar weeklikse voorraadvlakke is beskikbaar. Die Revised HLT & ND Inventory Model is ontwerp om die weeklikse vraag te skat en te gebruik gegewe hierdie mate van sigbaarheid. Die model het belowende resultate behaal. Onderwerpkenners wil die model in 'n loodstoets toets. Die onvoorspelbaarheid van die verskaffer is aangespreek om die vertroue van die verkryging van die gewenste bestelhoeveelhede te verhoog, en 'n model is geskep om te verseker dat die voorraadbergingskapasiteit nie oorskry word nie. Kwalitatiewe bekragtiging vir die modelle wat in hierdie verslag ontwikkel is, is verkry van vier onderwerpkenners. Die terugvoer is in diepte bespreek en is positief ten opsigte van die werk wat gedoen is.Master