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[DATE][SPEAKERS NAMES]

The 5th Global Health Supply Chain Summit

November 14 -16, 2012Kigali, Rwanda

Supply Chain Performance Approaches in Global Health

Jennifer Chavez

Objectives of Presentation

• Understand how metrics can improve health product availability and support public health programs/improve health outcomes

• Present and compare two examples of performance measurement systems in global health– WHO collaboration for HIV, malaria and TB– USAID | DELIVER PROJECT

• Moving forward: What other areas do we need to consider when applying metrics in different contexts

Why Measure Supply Chain Performance?

• Improve public health supply chain performance• Use data to identify and explore root causes of challenges• Assess and improve management of logistics functions at

all levels of the system• Inform and modify investments in supply chain

strengthening• Provide framework for local organizations to conduct

routine performance monitoring capacity and maintain performance in the absence of external assistance

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Two Examples of Supply Chain Metrics Widely Used in

Public Health

World Health Organization indicators for Procurement and Supply Management System

• Purpose– To harmonize country reporting requirements for increased

transparency, productivity and efficiency of programs– To track performance of National Procurement & Supply

Management (PSM) systems– To set early warning indicators of stockouts and overstocking– To alert managers to areas requiring technical support– Provide opportunities

• for collaboration across sectors and stakeholders including procurement stakeholders to improve national distribution system

• Strengthen data quality assurance and regular data reporting• Audience

– Procurement and supply management managers– Donors

WHO PSM indicators: Background

• Collaboration between 2005-2008– Various Donors– Desk review, initial selection, field testing, refinement

• Focus– Core PSM indicators

• Although, relevant for all national drug programs, donors and institutions focused on ARVs, TB and malaria

– Harmonized indicators• Highlight most critical problems• Avoid duplication of effort

Metrics I

Indicators Measures

Product Selection

% of commodities in National/WHO Standard Treatment Guidelines

Prescription and rational use

% of ARV & TB patients treated in line with treatment guidelines

% of initiating ARV patients treated in line with treatment guidelines

Quantification and forecasting

% products received vs. planned to receive

% of available quantity for consumption that is used

Procurement Prices and Delivery Time

Ratio between median price of products and international median reference value

% of orders delivered in full and on time per supplier

% of orders to be cleared from port that were cleared before the deadline

Average # of days between arrival at port and date of clearance from port

Purple represents early stockout warning indicators

Metrics II

Indicators

Inventory Control

% of treatment sites submitting inventory control reports on time

% of treatment sites placing orders while the stock in hand was below minimum stock levels

Availability

% of treatment sites that had a stock out at all during a define period

% of available items at each treatment site

% of treatment sites that had a stock out of a particular product during a defined period

Average duration of stockouts at i) each and ii) all treatment sites

Quality Assurance

% of product batches meeting QC standards

Distribution % of treatment sites receiving orders in full and on time

Loss % of quantities of each product loss per total quantities available

Application of PSM Metrics

• WHO: Falls under the general M&E framework• WHEN: Most metrics are measured periodically; others

triggered by SC event• FROM WHERE: Many metrics require collection from

multiple peripheral points e.g., health centers, through typical reporting process

• SO WHAT: All metrics have targets and signal action in the event targets are not achieved– Understanding root causes of deviation– Initiation of steps to address root cause– Early warning stockout metrics

USAID | DELIVER PROJECT Supply Chain Performance Measures

• Background– Standard industry metrics, – Applicable across programs and countries

• Audience• Supply chain managers, donors and project implementers,

government logistics management units• Purpose

– Monitor system performance – Provide routine feedback – Improve program management – Improve system performance at all levels of the supply chain– Report results and determine impact

INCREASE PRODUCT AVAILABILITY FOR IMPROVED HEALTH OUTCOMES

Types of

indicators

SCM Function

Quality Response Time Cost/Financial Productivity

Product Selection/ Forecasting /ProcurementSupplier/Sourcing (from purchaser’s perspective)Warehousing/Storage

Inventory Mgmt/ LMIS/Customer ResponseDistribution/Transport

Performance Measures

SCM Performance Measures Matrix by Function (USAID | DELIVER PROJECT)

Some examples of Indicators

Inventory Management/LMIS/Customer Response• QUALITY: Stockout rate• RESPONSE TIME: Order lead time order placed to received• COST/FINANCIAL: Value of unusable stock due to expiration/damage• PRODUCTIVITY: Facility reporting rates

Distribution/Transport• QUALITY: On-time arrivals: % shipments arriving as scheduled• RESPONSE TIME: Average delivery time from dispatch to destination• COST/FINANCIAL: Average transportation cost per km/m3/kg of

product• PRODUCTIVITY: Container capacity utilization per vehicle

Types of

indicators

SCM Function

Quality Response Time Cost/Financial Productivity

Product Selection/ Forecasting /Procurement

7(WHO: 4)

2 4 2

Supplier/Sourcing (from purchaser’s perspective)

3(WHO: 1)

2 1 1

Warehousing/Storage 5 3 2 3

Inventory Mgmt/ LMIS/Customer Response

9(WHO: 6)

3 4 4(WHO: 1)

Distribution/Transport 5(WHO: 1)

3 3 4

Metric Count

Lessons Learned about developing Supply Chain Metrics

• Past experience shows that setting up performance monitoring systems in public health is a long process requiring commitment and a desire to harmonize by all partners

• Requires building and incentivizing a culture to routinely collect, report, and use data up and down stream

• Aim is to institutionalize performance measurement capacity but governments face major human and financial resource constraints

Measures Must Evolve as Supply Chains Mature

• Investments work to strengthen supply chain management capacity and help supply chains systems evolve

• Overall indicators of performance must be applied and monitored to ensure performance is maintained or improved by investments

Measures Can Help Determine Enablers

• Although investments focus on strengthening the supply chain, these supply chain operate within a wider context

• Supply chain performance is affected by many things, many of which are not under the control of supply chain managers

• Further research is needed to help identify enablers and constraints and areas where direct investments have impact

• Must select metrics that serve both donor and country purposes

• How can we measure sustainability, ownership and capacity of MOHs to manage different Supply Chain functions?

• Need to find identify the key factors to be measured. What are the true triggers of performance?

“All that can be measured is not necessarily worth measuring” (Einstein)

• What other supply chain functions should be monitored and evaluated? What other measures exemplify performance?

Questions for Consideration

Questions for Consideration (continued)

• Is there a quality bias or is quality just a good basis for harmonizing standards?

• How do we differentiate the “early stock out warning” indicators from the other measures of performance?

• How do we determine the most practical indicators for supply chain performance in a setting and maintain measure of standardized indicators without becoming overwhelmed by number of measures required?

• How do we measure the implications of supply chain performance on general public health?

Thank you.