A framework for evaluating inventory management in healthcare Case: HUS Logistics

Abstract

Objectives of the Study

This thesis assembles a new framework for evaluating the relative monetary impact of one inventory management process when compared to another. The purpose is to compare the inventory management processes in a holistic way, evaluating them from three different perspectives. These are defined in this study as (1) process quality, (2) process efficacy and the (3) strength of inventory control. This framework was then applied, and used to assess the merits of a logistical service performed by HUS Logistics, Täyttöpalvelu, translated here as Replenishment Service (RS), comparing the inventory management process it forms with the inventory management process that exists in hospital units that have not adopted the service, referred to here as NRS.

Academic background and methodology

The framework is founded on ideas borrowed from several strands of literature, including logistics, inventory management, process quality, and process management literature. The hypotheses on the possible benefits of RS that guide this study are based on supply chain integration literature, and models such as Third-Party Logistics and Vendor-Managed Inventory. The framework is applied to the case study of HUS's RS and NRS by subjecting each of the elements of the framework to a mostly quantitative analysis that is based on data acquired from HUS Logistics inventory management systems, as well as observations and process times collected at two HUS hospital sites.

Findings and conclusions

The findings of the study relate to the usefulness of the new framework in comparing inventory management processes. It is deemed a useful tool, and the effectiveness of using a novel method for analyzing inventory efficiency is assessed. With regards to the case study, the thesis concludes that RS is a superior process. Out of the three perspectives considered, the results were fairly clear for two, and ambiguous for one. The study calls for the choice of subscription to RS to concentrate more on system-level benefits, which are even more significant than unit-level ones.