ABC/XYZ Analysis for Kanban System Implementation in Pharmaceutical Supply Chain

2021 ◽  
Vol 14 (3) ◽  
pp. 63-78
Author(s):  
Asrat Mekonnen Gobachew ◽  
Daniel Kitaw ◽  
Eshetie Berhan ◽  
Hans-Dietrich Haasis
Keyword(s):  
Supply Chain ◽  
Inventory Management ◽  
Direct Observation ◽  
Primary Data ◽  
Pharmaceutical Supply Chain ◽  
Monthly Data ◽  
Inventory Management System ◽  
Kanban System ◽  
One Year ◽  
Management Staff

The purpose of this study is to show how the implementation of the Kanban system based on ABC/XYZ analysis helps in improving the inventory management system in the supply chain where there is a lack of proper inventory management. Ethiopian pharmaceutical supply agency's distribution network is taken as a case to show the significance of the Kanban system. Monthly data for one year is collected and is accompanied by primary data obtained from direct observation and discussion with the company's management staff. ABC, XYZ, and ABC/XYZ matrix analyses were performed to determine items to be considered in Kanban implementation. By analysis, it is shown that the Kanban system can improve inventory-related costs by about 75%. While the Kanban system is rarely implemented in the pharmaceutical sector so far, it is understood in this study that it can bring improvements in the sector if properly implemented. Though it is shown by analyzing data on how the Kanban system can improve inventory-related costs, it is imperative to practically implement it for validation of its effectiveness.

scholarly journals A literature review on multi-echelon inventory management: the case of pharmaceutical supply chain

2018 ◽  
Vol 200 ◽  
pp. 00013 ◽  
Author(s):  
Nouçaiba Sbai ◽  
Abdelaziz Berrado
Keyword(s):  
Supply Chain ◽  
Customer Service ◽  
Inventory Management ◽  
Raw Materials ◽  
Integrated Approach ◽  
Service Level ◽  
Pharmaceutical Products ◽  
Management Problem ◽  
Pharmaceutical Supply Chain ◽  
Customer Service Level

Inventory management remains a key challenge in supply chain management. Many companies recognize the benefits of a good inventory management system. An effective inventory management helps reaching a high customer service level while dealing with demand variability. In a complex supply chain network where inventories are found across the entire system as raw materials or finished products, the need for an integrated approach for managing inventory had become crucial. Modelling the system as a multi-echelon inventory system allows to consider all the factors related to inventory optimization. On the other hand, the high criticality of the pharmaceutical products makes the need for a sophisticated supply chain inventory management essential. The implementation of the multi-echelon inventory management in such supply chains helps keeping the stock of pharmaceutical products available at the different installations. This paper provides an insight into the multi-echelon inventory management problem, especially in the pharmaceutical supply chain. A classification of several multi-echelon inventory systems according to a set of criteria is provided. A synthesis of multiple multi-echelon pharmaceutical supply chain problems is elaborated.

Enterprise Inventory Management and Simulation

2014 ◽  
Vol 933 ◽  
pp. 874-878
Author(s):  
Yun Rui Wang
Keyword(s):  
Computer Simulation ◽  
Supply Chain ◽  
Inventory Management ◽  
Simulation Software ◽  
Total Cost ◽  
The Third ◽  
Inventory Strategy ◽  
One Year ◽  
The Cost ◽  
Operation Cost

Inventory is an important link in supply chain, according to characteristics and objectives of inventory control, the reasonable safety inventory, order point, the highest inventory and inventory strategy were determined based on historical sales data. Using Witness simulation software, the optimal strategy was selected from nine inventory strategies by running simulation model for one year. If goods shortage was allowing, the seventh schemes (72000,158100) was better ,the minimum total cost was 888158 yuan ; considering allowing a small amount of shortage, the cost of eighth schemes ( 82000,158100) was least of 1095167; the third scenarios (92000,138100) was selected if without shortage, and the minimum total cost was 1254909 yuan. This shows, the application of computer simulation to assist in the management of inventory is scientific and feasible, it can help enterprises to save the order and operation cost.

Detecting counterfeit pharmaceutical drugs

2019 ◽  
Vol 26 (4) ◽  
pp. 1027-1047
Author(s):  
Dominic Peltier-Rivest ◽  
Carl Pacini
Keyword(s):  
Supply Chain ◽  
Inventory Management ◽  
Prevention Strategy ◽  
Pharmaceutical Drugs ◽  
Counterfeit Drugs ◽  
Pharmaceutical Supply Chain ◽  
Content Type ◽  
Forensic Accounting ◽  
Recent Estimate ◽  
Multi Stakeholder

Purpose This paper aims to analyze drug counterfeiting, explains its risk factors and operating and legal environments reviews recent legal cases and develops a multi-stakeholder prevention strategy that includes forensic accounting methods. Design/methodology/approach This is a theoretical study based on legal case studies and the best forensic accounting strategies. Findings Pharmaceutical drug counterfeiting is a fast-growing fraud that so far has attracted little attention from forensic accountants. A recent estimate projects that criminals collect around $75bn annually in illicit sales from counterfeit drugs (Bairu, 2015). Pharmaceutical counterfeiting also leads to the loss of lives when criminals use lethal chemicals in the manufacturing of fake medicines (Liang, 2006a; Brown, 2005). Because the detection of drug counterfeiting is extremely difficult after fake medicines have been ingested by patients, the strategy developed in this paper is based on early discovery by using reliable tracking technologies and inventory management controls in the supply chain, conducting effective regulatory and legitimate customs inspections, and increasing consumer awareness of basic forensic accounting tools. Research limitations/implications This paper extends previous research by integrating various factors into a single multi-stakeholder prevention framework. Practical implications The paper presents a synthesized, comprehensive view of the drug fraud epidemic and analyzes concrete steps that can be taken to protect the pharmaceutical supply chain to reduce the loss of lives and monetary injuries. Originality/value No previous research has analyzed this issue from a multi-stakeholder point of view and used forensic accounting tools to complement a prevention strategy. The drug counterfeiting prevention strategy developed in this paper addresses the supply side, the regulatory enforcement side and the demand side.

Segmental differences in pharmaceutical industry and its impact on supply chain performance

2019 ◽  
Vol 13 (4) ◽  
pp. 516-540 ◽  
Author(s):  
Saswati Tripathi ◽  
Krishnamachari Rangarajan ◽  
Bijoy Talukder
Keyword(s):  
Supply Chain ◽  
Pharmaceutical Industry ◽  
Business Processes ◽  
Primary Data ◽  
Supply Chain Performance ◽  
Pharmaceutical Supply Chain ◽  
Content Type ◽  
Pharmaceutical Firms ◽  
Capital Productivity ◽  
Financial Metrics

Purpose Pharmaceutical industry involves highly specialized business processes where strong research and development focus along with market differentiation and localization are the deciders of success. This has led to evolution of segments and complexities in supply chain. This paper aims to focus on segmental differences in supply chain performance of Indian Pharmaceutical firms. Design/methodology/approach This paper measures supply chain performance of select segmental players of the pharmaceutical industry using financial metrics and supply chain operations reference (SCOR) key performance indicators through a five-year timeline. The best performance results are compared across the segments to identify unique performance features, if any. The sample results are validated through hypothesis testing methodology. Findings This paper has evidenced that the innovators segment is performing better in cash-to-cash cycle time and supply chain working capital productivity, whereas generics segment is doing better in distribution cost efficiency and total cost to serve aspects. Research limitations/implications The paper is based on historical financial data of firms and measures the firm focused supply chain performance. The results may not be generalized in a global context but serve as a motivator for other researchers to take similar studies. The paper may further be analyzed with primary data of the firms to understand the segmental difference in customer focus supply chain performance measures. Practical implications This paper has brought out important segmental supply chain performance features of the Indian pharmaceutical firms and identified segment-specific problems by integrating SCOR KPIs and financial metrics. Originality/value This paper has integrated both SCOR KPIs and financial metrics to provide unique insights on segmental differences in the performance behavior of pharmaceutical supply chain.

scholarly journals Construction and optimization of inventory management system via cloud-edge collaborative computing in supply chain environment in the Internet of Things era

PLoS ONE ◽  
2021 ◽  
Vol 16 (11) ◽  
pp. e0259284
Author(s):  
Hailan Ran
Keyword(s):  
Genetic Algorithm ◽  
Supply Chain ◽  
Inventory Management ◽  
Management System ◽  
Prediction Method ◽  
Spare Parts ◽  
Collaborative Computing ◽  
Demand Prediction ◽  
Industrial Enterprises ◽  
Inventory Management System

The present work aims to strengthen the core competitiveness of industrial enterprises in the supply chain environment, and enhance the efficiency of inventory management and the utilization rate of inventory resources. First, an analysis is performed on the supply and demand relationship between suppliers and manufacturers in the supply chain environment and the production mode of intelligent plant based on cloud manufacturing. It is found that the efficient management of spare parts inventory can effectively reduce costs and improve service levels. On this basis, different prediction methods are proposed for different data types of spare parts demand, which are all verified. Finally, the inventory management system based on cloud-edge collaborative computing is constructed, and the genetic algorithm is selected as a comparison to validate the performance of the system reported here. The experimental results indicate that prediction method based on weighted summation of eigenvalues and fitting proposed here has the smallest error and the best fitting effect in the demand prediction of machine spare parts, and the minimum error after fitting is only 2.2%. Besides, the spare parts demand prediction method can well complete the prediction in the face of three different types of time series of spare parts demand data, and the relative error of prediction is maintained at about 10%. This prediction system can meet the basic requirements of spare parts demand prediction and achieve higher prediction accuracy than the periodic prediction method. Moreover, the inventory management system based on cloud-edge collaborative computing has shorter processing time, higher efficiency, better stability, and better overall performance than genetic algorithm. The research results provide reference and ideas for the application of edge computing in inventory management, which have certain reference significance and application value.

scholarly journals Proposal for Implementation of a Kanban System in the Auxiliary Inventory Sector in a Auto Parts Company

2019 ◽  
Vol 7 (10) ◽  
pp. 849-859
Author(s):  
Tamires Lima de Souza ◽  
David Barbosa de Alencar ◽  
Alexandra Priscilla Tregue Costa ◽  
Mauro Cezar Aparício de Souza
Keyword(s):  
Action Research ◽  
Inventory Control ◽  
Inventory Management ◽  
Management System ◽  
Resource Reallocation ◽  
Inventory Management System ◽  
Study Methodology ◽  
Auto Parts ◽  
Kanban System ◽  
Financial Profitability

The article presents a proposal for the implementation of a kanban system in an auxiliary inventory sector in an auto parts company. The overall objective of the research was to propose a methodology that seeks to efficiently and cost-effectively control inventory for the company in order to avoid wastage of resources and to foster more adequate planning of resource reallocation by avoiding unnecessary inventory spending through of the kanban system. The study methodology was applied based on a bibliographic research and an action research, in which data were collected on site and the results of the research substantiated the proposal of the kanban system in the company's auxiliary stock sector. The results showed that the kanban system will bring an adequate organization of work in order to enable the operation in inventory control, replenishment and calculation of material demand to be performed more effectively, generating greater financial profitability through the company. a leaner inventory management system.

scholarly journals INVENTORY MANAGEMENT SYSTEMS ON SUPPLY CHAIN PERFORMANCE OF FAST-MOVING CONSUMER GOODS MANUFACTURERS IN KENYA

2021 ◽  
Vol 5 (1) ◽  
pp. 1
Author(s):  
Eric Jepherson Muhalia ◽  
Dr. Patrick Karanja Ngugi ◽  
Dr. Makori Moronge
Keyword(s):  
Supply Chain ◽  
Inventory Management ◽  
Consumer Goods ◽  
Fast Moving ◽  
New Technology ◽  
Management Systems ◽  
Primary Data ◽  
Supply Chain Performance ◽  
Sampling Frame ◽  
Fast Moving Consumer Goods

Purpose: The purpose of this study was to determine the influence of inventory management systems on supply chain performance of fast-moving consumer goods manufacturers in KenyaMethodology: The study adopted descriptive research design. The unit of observation was the operations manager of the 51 FMCG manufacturers located in Nairobi. The sampling frame of the current study consisted of operations managers in the manufacturers of the FMCGs in Nairobi. The study used the census method to select 51 manufacturers of the FMCGs in Nairobi, thus the sample of the study was 51 respondents. Primary data was used in the study. The study used questionnaires to collect data. Mixed methods technique of analyzing data was used where both descriptive and inferential analysis were used. The data collected from the field was analyzed using SPSS 23 program. The questionnaires were referenced and the items in them coded for easier data entry. The presentation of the findings was done using tables.Results: The study found that inventory management systems positively and significantly influences Supply chain performance of FMCG in Kenya. The study found that respondents agreed that inventory management systems promotes improved supplier, vendor, and partner relationships; inventory management systems enables the company to maintain a centralized record of every asset; inventory management systems helps in reduction in storage costs; inventory management systems helps to keep track on current stock levels which enables the company to reorder with greater accuracy; and that inventory management systems promotes better reporting and forecasting capabilities.Unique contribution to theory, practice and policy: The study recommended that the recommends the company to adopt new technology (updated inventory management system) to ensure that the processes in the company are efficient; this can be achieved by upgrading operation standards and implementation of new technology and software. Because of technological itches, it is possible for the company to lose data, therefore it is recommended that the company should always have backup of inventory data.

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