Title page for ETD etd-04092009-110952


Type of Document Dissertation
Author Woosley, John Michael
Author's Email Address jwoosle@lsu.edu
URN etd-04092009-110952
Title Improving Healthcare Supply Chains and Decision Making in the Management of Pharmaceuticals
Degree Doctor of Philosophy (Ph.D.)
Department Information Systems & Decision Sciences (Business Administration)
Advisory Committee
Advisor Name Title
Helmut Schneider Committee Co-Chair
Peter Kelle Committee Co-Chair
Boryung Ju Committee Member
James Van Scotter Committee Member
Sonja Wiley-Patton Committee Member
Keywords
  • supply chain management
  • healthcare
  • decision support
  • inventory control
  • pharmaceuticals
Date of Defense 2009-02-06
Availability unrestricted
Abstract
The rising cost of quality healthcare is becoming an increasing concern. A significant part of healthcare cost is the pharmaceutical supply component. Improving healthcare supply chains is critical not only because of the financial magnitude but also because it impacts so many people. Efforts such as this project are essential in understanding the current operations of healthcare pharmacy systems and in offering decision support tools to managers struggling to make the best use of organizational resources.

The purpose of this study is to address the objectives of a local hospital that exhibits typical problems in pharmacy supply chain management. We analyze the pharmacy supply network structure and the different, often conflicting goals in the decisions of the various stakeholders. We develop quantitative models useful in optimizing supply chain management and inventory management practices. We provide decision support tools that improve operational, tactical, and strategic decision making in the pharmacy supply chain and inventory management of pharmaceuticals.

On one hand, advanced computerized technology that manages pharmaceutical dispensation and automates the ordering process offers considerable progress to support pharmacy product distribution. On the other hand, the available information is not utilized to help the managers in making the appropriate decisions and control the supply chain management.

Quantitative methods are presented that provide simplified, practical solutions to pharmacy objectives and serve as decision support tools. For operational inventory decisions we provide the min and max par levels (reorder point and order up to level) that control the automated ordering system for pharmaceuticals. These parameters are based on two near-optimal allocation policies of cycle stock and safety stock under storage space constraint. For the tactical decision we demonstrate the influence of varying inventory holding cost rates on setting the optimal reorder point and order quantity for items. We present a strategic decision support tool to analyze the tradeoffs among the refill workload, the emergency workload, and the variety of drugs offered. We reveal the relationship of these tradeoffs to the three key performance indicators at a local care unit: the expected number of daily refills, the service level, and the storage space utilization.

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