Improving healthcare supply chains and decision making in the management of pharmaceuticals

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

Periodic Review, Push Inventory Policies for Remanufacturing

Sustainability has become a major issue in most economies, causing many leading companies to focus on product recovery and reverse logistics. This research is focused on product recovery, and in particular on production control and inventory management in the remanufacturing context. We study a remanufacturing facility that receives a stream of returned products according to a Poisson process. Demand is uncertain and also follows a Poisson process. The decision problems for the remanufacturing facility are when to release returned products to the remanufacturing line and how many new products to manufacture. We assume that remanufactured products are as good as new. In this paper, we employ a "push" policy that combines these two decisions. It is well known that the optimal policy parameters are difficult to find analytically; therefore, we develop several heuristics based on traditional inventory models. We also investigate the performance of the system as a function of return rates, backorder costs and manufacturing and remanufacturing lead times; and we develop approximate lower and upper bounds on the optimal solution. We illustrate and explain some counter-intuitive results and we test the performance of the heuristics on a set of sample problems. We find that the average error of the heuristics is quite low.inventory;reverse logistics;remanufacturing;environment;heuristics

Physical internet-enabled hyperconnected distribution assessment

L'Internet Physique (IP) est une initiative qui identifie plusieurs symptômes d'inefficacité et non-durabilité des systèmes logistiques et les traite en proposant un nouveau paradigme appelé logistique hyperconnectée. Semblable à l'Internet Digital, qui relie des milliers de réseaux d'ordinateurs personnels et locaux, IP permettra de relier les systèmes logistiques fragmentés actuels. Le but principal étant d'améliorer la performance des systèmes logistiques des points de vue économique, environnemental et social. Se concentrant spécifiquement sur les systèmes de distribution, cette thèse remet en question l'ordre de magnitude du gain de performances en exploitant la distribution hyperconnectée habilitée par IP. Elle concerne également la caractérisation de la planification de la distribution hyperconnectée. Pour répondre à la première question, une approche de la recherche exploratoire basée sur la modélisation de l'optimisation est appliquée, où les systèmes de distribution actuels et potentiels sont modélisés. Ensuite, un ensemble d'échantillons d'affaires réalistes sont créé, et leurs performances économique et environnementale sont évaluées en ciblant de multiples performances sociales. Un cadre conceptuel de planification, incluant la modélisation mathématique est proposé pour l’aide à la prise de décision dans des systèmes de distribution hyperconnectée. Partant des résultats obtenus par notre étude, nous avons démontré qu’un gain substantiel peut être obtenu en migrant vers la distribution hyperconnectée. Nous avons également démontré que l'ampleur du gain varie en fonction des caractéristiques des activités et des performances sociales ciblées. Puisque l'Internet physique est un sujet nouveau, le Chapitre 1 présente brièvement l’IP et hyper connectivité. Le Chapitre 2 discute les fondements, l'objectif et la méthodologie de la recherche. Les défis relevés au cours de cette recherche sont décrits et le type de contributions visés est mis en évidence. Le Chapitre 3 présente les modèles d'optimisation. Influencés par les caractéristiques des systèmes de distribution actuels et potentiels, trois modèles fondés sur le système de distribution sont développés. Chapitre 4 traite la caractérisation des échantillons d’affaires ainsi que la modélisation et le calibrage des paramètres employés dans les modèles. Les résultats de la recherche exploratoire sont présentés au Chapitre 5. Le Chapitre 6 décrit le cadre conceptuel de planification de la distribution hyperconnectée. Le chapitre 7 résume le contenu de la thèse et met en évidence les contributions principales. En outre, il identifie les limites de la recherche et les avenues potentielles de recherches futures.The Physical Internet (PI) is an initiative that identifies several symptoms of logistics systems unsustainability and inefficiency and tackles them by proposing a novel paradigm called Hyperconnected Logistics. Similar to the Digital Internet, which connects thousands of personal and local computer networks, PI will connect the fragmented logistics systems of today. The main purpose is to enhance the performance of logistics systems from economic, environmental and social perspectives. Focusing specifically on the distribution system, this thesis questions the order of magnitude of the performance gain by exploiting the PI-enabled hyperconnected distribution. It is also concerned by the characterization of the hyperconnected distribution planning. To address the first question, an exploratory research approach based on optimization modeling is applied; first, the current and prospective distribution systems are modeled. Then, a set of realistic business samples are created, and their economic and environmental performance by targeting multiple social performances are assessed. A conceptual planning framework is proposed to support the decision making in the hyperconnected distribution system. Based on the results obtained by our investigation, it can be argued that a substantial gain can be achieved by shifting toward Hyperconnected Distribution. It is also revealed that the magnitude of the gain varies by business characteristics and the targeted social performance. Since the Physical Internet is a novel topic, chapter 1 briefly introduces PI and Hyperconnected Logistics. Chapter 2 discusses the research foundations, goal and methodology. It also describes the challenges of conducting this research and highlights the type of contributions aimed for. Chapter 3 presents the optimization models including a core distribution network design modeling approach. Influenced by the characteristics of the current and prospective distribution systems, three distribution system-driven models are developed. Chapter 4 engages with the characterization of the business samples, the modeling and calibration of the parameter that are employed in the models. The exploratory investigation results are presented in Chapter 5. Chapter 6 describes the hyperconnected distribution planning framework. Chapter 7 summarizes the content of the thesis and highlights the main contributions. Moreover, it identifies the research limitations and potential future research avenues