Inventory Management in Healthcare

Benefits of Maintaining Inventory in Healthcare Supply Chain
Maintaining an inventory in a healthcare supply chain has many benefits. The benefits
include protection of investment since effective maintenance of inventory reduces chances of
theft. Other major benefits of maintaining an inventory in healthcare supply chains are
achieving effectiveness and efficiency of supply chains (Leaven, Ahmmad & Peebles, 2017).
These benefits could make a major difference in my current organization. Improving
efficiency and effectiveness of supply chains while simultaneously cutting down on costs
could reduce cost of healthcare services delivery, improve efficiency of care and, therefore,
improve patient outcomes.

Difference Between Inventory and Supply

Even though they are often used interchangeably, there is a major difference between
supply and inventory. Inventory includes goods that an organization sells to generate revenue
(Langabeer & Helton, 2016). In healthcare settings, inventory includes items such as drugs.
Since it generates revenue, inventory is an asset to the organization. Unlike inventory which
generates revenue for the organization, supplies are items that an organization uses for its
operations and infrastructure (Langabeer & Helton, 2016). In healthcare facilities, supplies
include surgical masks, clips, and gloves. Supplies constitute an expense to the organization.

Vendor-Managed Inventory

It is a supply chain agreement where the supplier makes decisions regarding inventory
management. These decisions include policies on management of different products and
determination of appropriate stock levels (Ledlow, Manrodt & Schott, 2017). This type of
supply chain agreement is also called supplier-managed inventory.

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Factors that Affect Inventory Decisions

In my organization, there are various factors that influence decisions regarding
inventory. The two most important ones are cost and logistics. Costs that are associated with
inventory management include cost of ordering an item, transportation, taxes, and storage
(Singh & Verma, 2018). Thus, the quantity of inventory depends on the availability of funds
to meet all these costs. Logistics is also a key factor to consider when making decisions
regarding inventory. For instance, the size of the warehouse influences the quantities of
inventory that the organization orders.

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References

Langabeer, J. R., & Helton, J. (2016). Health care operations management: A systems
perspective (2nd ed.). Burlington, MA: Jones and Bartlett Learning.
Leaven, L., Ahmmad, K., & Peebles, D. (2017). Inventory management applications for
healthcare supply chains. Internal Journal Supply Chain Management, 6, 1-7.
Ledlow, G. R., Manrodt, K. B., & Schott, D. E. (2017). Healthcare supply chain
management: Elements, operations, and strategies. Burlington, MA: Jones & Bartlett
Learning.
Singh, D., & Verma, A. (2018). Inventory management in supply chain. Materials Today:
Proceedings, 5(2), 3867-3872.