Reducing cost and waste in hospital inventory management: a demand-driven replenishment strategy

Description

Logistics represents a large share of hospitals’ operating budgets. However, it only holds a supporting role in hospitals’ primary task of providing care to patients. Hospital inventory strategies typically rely on high safety stocks instead of data-driven methods, thus leaving potential for optimisation. Hospitals are organised in medical departments, with separate storage and budgets. Hospital inventory management deals with various medical products of diverse criticality and uncertain demand inside a complex multi-echelon storage structure. Public hospitals require a service-oriented approach that differs from classic industry profit-based inventory management.
Data-driven decision support systems are widely spread in the private sector, whereas medical practitioners without advanced analytical backgrounds often take the inventory decisions in hospitals. Operational data are becoming increasingly available in hospitals, raising the potential for industry-inspired data-driven approaches. This paper offers a case-based analysis using data from a Danish public hospital. Our goal is to understand and model the hospital’s demand for drugs and devise a demand-driven replenishment system. This work is inspired by state-of-the-art industry Collaborative Planning, Forecasting and Replenishment systems (CPFR) and tailored to hospitals’ service-oriented nature. The proposed approach aims to reduce on-hand inventory, cost, and waste while maintaining or improving service level.

Period	19 Jul 2022
Event title	48th Annual Meeting of the EURO Working Group on Operational Research Applied to Health Care
Event type	Conference
Conference number	48
Location	Bergamo, ItalyShow on map