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![PROCUREMENT
1. Directorate general of supply & disposal
(DGS & D, Govt. Of India]
2. Medical stores depot (M. S.D. Government
of India, Ministry of H & FW]
3. Private or public sector undertakings.
4. Receiving donations.](https://image.slidesharecdn.com/30961-130413134211-phpapp02/75/Hospital-pharmacy-management-11-2048.jpg)
![Economic order of quantity
EOQ = Average Monthly Consumption X Lead Time [in
months] + Buffer Stock – Stock on hand
ECONOMIC ORDER OF
QUANTITY(EOQ)
PURCHASING CARRYING
COST COST](https://image.slidesharecdn.com/30961-130413134211-phpapp02/75/Hospital-pharmacy-management-23-2048.jpg)
![ANNUAL COST CUMMULATI VE
I TEM % I TEM COST %
AB C [ Rs.] COST [ Rs.]
1 90000 90000
10 % 70 %
A 2 50000 140000
3 20000 160000
N 4 7500 167500
20 % 20 %
A 5 7500 175000
6 5000 180000
L
7 4500 184500
Y 8 4000 188500
9 2750 191250
S
10 1750 193000
I 11 1500 194500
S 12 1500 196000
13 500 196500 10 %
70 %
14 500 197000
15 500 197500
W O RK 16 500 198000
SHEET 17 500 198500
18 500 199000
19 500 199500
20 500 200000](https://image.slidesharecdn.com/30961-130413134211-phpapp02/75/Hospital-pharmacy-management-28-2048.jpg)
![Maintenance sheet:
Annual maintenance contract [AMC]
Starting date
Expiry date
Service / repair description
Materials / spares used
Cost of repairs
In-house
Outside agency](https://image.slidesharecdn.com/30961-130413134211-phpapp02/75/Hospital-pharmacy-management-34-2048.jpg)
Uploaded byArmin Eisazaei
Hospital pharmacy management
The document discusses hospital pharmacy management. It defines material management and outlines its aims including obtaining the right quality, quantity, and time of supplies at the right place and cost. The objectives, functions, and principles of material management are described. Key aspects covered include procurement, storage, inventory control, and equipment maintenance. ABC, VED, SDE, and HML analyses are explained for inventory classification and control. The importance of material management for efficiency and healthy operations is highlighted.
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Hospital pharmacy management
- 1. HOSPITAL PHARMACY MANAGEMENT BY: HASSAN ABDELWAHAB 1st year – pharmacy practice
- 2. Definition Itis concerned with planning, organizing and controlling the flow of materials from their initial purchase through internal operations to the service point through distribution. OR Material management is a scientific technique, concerned with Planning, Organizing &Control of flow of materials, from their initial purchase to destination.
- 3. AIM OF MATERIALMANAGEMENT To get 1. The Right quality 2. Right quantity of supplies 3. At the Right time 4. At the Right place 5. For the Right cost
- 4. PURPOSE OF MATERIALMANAGEMENT •To gain economy in purchasing •To satisfy the demand during period of replenishment •To carry reserve stock to avoid stock out •To stabilize fluctuations in consumption •To provide reasonable level of client services
- 5. Objective of materialmanagement Primary •Right price Secondary •High turnover •Forecasting •Low procurement •Inter-departmental • storage cost harmony •Continuity of supply •Product improvement •Consistency in quality •Standardization •Good supplier •Make or buy decision relations •New materials & products •Development of •Favorable reciprocal personnel relationships •Good information system
- 6. Economy in materialmanagement •Containing the costs •Instilling efficiency in all activities
- 7. Four basic needsof Material management 1. To have adequate materials on hand when needed 2. To pay the lowest possible prices, consistent with quality and value requirement for purchases materials 3. To minimize the inventory investment 4. To operate efficiently
- 8. Basic principles ofmaterial management 1. Effective management & supervision It depends on managerial functions of • Planning • Organizing • Staffing • Directing • Controlling • Reporting • Budgeting 2. Sound purchasing methods 3.Skillful & hard poised negotiations 4.Effective purchase system 5.Should be simple 6.Must not increase other costs 7.Simple inventory control programme
- 9. Elements of materialmanagement 1. Demand estimation 2. Identify the needed items 3. Calculate from the trends in Consumption during last 2 years. 4. Review with resource of limitations.
- 10. Functional areas ofmaterial management 1. Purchasing 2. Central service supply 3. Central stores 4. The print shops 5. The pharmacy 6. Dietary & Linen services( manufacturing services)
- 11. PROCUREMENT 1. Directorate generalof supply & disposal (DGS & D, Govt. Of India] 2. Medical stores depot (M. S.D. Government of India, Ministry of H & FW] 3. Private or public sector undertakings. 4. Receiving donations.
- 12. Procurement cycle • Reviewselection • Determine needed quantities • Reconcile needs & funds • Choose procurement method • Select suppliers • Specify contract terms • Monitor order status • Receipt & inspection
- 13. Objectives of procurementsystem •Acquire needed supplies as inexpensively as possible •Obtain high quality supplies •Assure prompt & dependable delivery •Distribute the procurement workload to avoid period of idleness & overwork •Optimize inventory management through scientific procurement procedures
- 14. FLOW OF PROCUREMENTDECISIONS DRUG REQUIREMENTS DRUG REQUIREMENTS YES DETERMINE DRUGS & DRUG DETERMINE DRUGS & DRUG DONATION DONATION REQUIREMENTS REQUIREMENTS SOURCE SOURCE ADJUST ADJUST QUANTITIES QUANTITIES NO YES DETERMINE DRUGS & DRUG DETERMINE DRUGS & DRUG GOVERNMENT GOVERNMENT REQUIREMENTS REQUIREMENTS PRODUCTION PRODUCTION ADJUST ADJUST NO QUANTITIES QUANTITIES PURCHASE PURCHASE REQUIREMENTS REQUIREMENTS NO NO NO OPEN TENDER OPEN TENDER RESTRICTED RESTRICTED NEGOTIATED NEGOTIATED DIRECT DIRECT TENDER TENDER TENDER TENDER PURCHASE PURCHASE YES YES YES YES REQUEST OFFERS FROM REQUEST OFFERS FROM LOCATE LOCATE CONTACT CONTACT CALL FOR CALL FOR RELIABLE ELIGIBLE SUPPLIERS ELIGIBLE SUPPLIERS RELIABLE RELIABLE RELIABLE OFFERS OFFERS SUPPLIER SUPPLIERS SUPPLIERS SUPPLIER EVALUATE & EVALUATE & EVALUATE OFFERS EVALUATE OFFERS NEGOTIATE PRICE & NEGOTIATE PRICE & ESTABLISH ESTABLISH SELECT SUPPLIER SELECT SUPPLIER & SELECT & SELECT SUPPLY CONDITIONS SUPPLY CONDITIONS PRICE PRICE SUPPLIERS SUPPLIERS PURCHASE ORDER PURCHASE ORDER PURCHASE ORDER // PURCHASE ORDER PURCHASE PURCHASE PURCHASE PURCHASE // CONTRACT CONTRACT CONTRACT CONTRACT ORDER // ORDER ORDER // ORDER CONTRACT CONTRACT CONTRACT CONTRACT DRUGS RECEIVED, CHECKED AGAINST PURCHASE ORDER //CONTRACT SPECIFICATIONS & CLEARED DRUGS RECEIVED, CHECKED AGAINST PURCHASE ORDER CONTRACT SPECIFICATIONS & CLEARED FOR DISTRIBUTION FOR DISTRIBUTION
- 15. Open tender •Public bidding,resulting in low prices •Published in newspapers •Term - 4 weeks •Quotations must be sent in the specific forms that are sold, before the time &date mentioned in the tender form •In technical items, ‘two packets or two bins’ system is followed. Offers are given in two separate packets. •Technical bid •Financial bid Cont……
- 16. •First technical bidis opened & short listed •Then financial bid of selected companies are opened & lowest is selected •Delayed tenders & late tenders are not accepted. But if, in case of delayed tenders, if the rate quoted is very less, then it can be accepted. •Quotations are opened in presence of indenting department, accounts & authorized persons of party •Validity of tenders – generally 90 days
- 17. Earnest money 2 %of the tender amount or as decided has to be paid along with all quotations. In case of default 1/5 is withheld Restricted or limited tender From limited suppliers (about 10) Lead-time is reduced Better quality Negotiated procurement Buyer approaches selected potential Suppliers & bargain directly Used in long time supply contracts Direct procurement Purchased from single supplier, at his quoted price Prices may be high Reserved for proprietary materials, or low priced, small quantity & emergency purchases
- 18. Rate contract Firms areasked to supply stores at specified Rates during the period covered by the Contract Spot purchase It is done by a committee, which includes an officer from stores, accounts & purchasing departments Risk purchase If supplier fails, the item is purchased from other agencies & the difference in cost is recovered from the first supplier
- 19. Points to rememberwhile purchasing •Proper specification •Invite quotations from reputed firms •Comparison of offers based on basic price, freight & insurance, taxes and levies •Quantity & payment discounts •Payment terms •Delivery period, guarantee •Vendor reputation (reliability, technical capabilities, Convenience, Availability, after- sales service, sales assistance) •Short listing for better negotiation terms •Seek order acknowledgement
- 20. Storage •Store must beof adequate space •Materials must be stored in an appropriate place • in a correct way •Group wise & alphabetical arrangement helps in •identification & retrieval •First-in, first-out principle to be followed •Monitor expiry date •Follow two bin or double shelf system, to avoid •Stock outs •Reserve bin should contain stock that will cover •lead time and a small safety stock Issue & use Can be centralized or decentralized
- 21. Inventory control It meansstocking adequate number and kind of stores, so that the materials are available whenever required and wherever required. Scientific inventory control results in optimal balance
- 22. Functions of inventorycontrol •To provide maximum supply service, consistent with maximum efficiency & optimum investment. •To provide cushion between forecasted & actual demand for a material
- 23. Economic order ofquantity EOQ = Average Monthly Consumption X Lead Time [in months] + Buffer Stock – Stock on hand ECONOMIC ORDER OF QUANTITY(EOQ) PURCHASING CARRYING COST COST
- 24. •Re-order level: stocklevel at which fresh order is placed. •Average consumption per day x lead time + buffer stock •Lead time: Duration time between placing an order & receipt of material •Ideal – 2 to 6 weeks.
- 25. ABC ANALYSIS (ABC = Always Better Control) This is based on cost criteria. It helps to exercise selective control when confronted with large number of items it rationalizes the number of orders, number of items & reduce the inventory. About 10 % of materials consume 70 % of resources About 20 % of materials consume 20 % of resources About 70 % of materials consume 10 % of resources
- 26. ‘A’ ITEMS Small innumber, but consume large amount of resources Must have: •Tight control •Rigid estimate of requirements •Strict & closer watch •Low safety stocks •Managed by top management
- 27. ‘C’ ITEMS Larger innumber, but consume lesser amount of resources Must have: •Ordinary control measures •Purchase based on usage estimates •High safety stocks ABC analysis does not stress on items those are less costly but may be vital
- 28. ANNUAL COST CUMMULATI VE I TEM % I TEM COST % AB C [ Rs.] COST [ Rs.] 1 90000 90000 10 % 70 % A 2 50000 140000 3 20000 160000 N 4 7500 167500 20 % 20 % A 5 7500 175000 6 5000 180000 L 7 4500 184500 Y 8 4000 188500 9 2750 191250 S 10 1750 193000 I 11 1500 194500 S 12 1500 196000 13 500 196500 10 % 70 % 14 500 197000 15 500 197500 W O RK 16 500 198000 SHEET 17 500 198500 18 500 199000 19 500 199500 20 500 200000
- 29. ‘B’ ITEM Intermediate Must have: •Moderate control •Purchase based on rigid requirements •Reasonably strict watch & control •Moderate safety stocks •Managed by middle level management
- 30. VED ANALYSIS •Basedon critical value & shortage cost of an item –It is a subjective analysis. •Items are classified into: Vital: •Shortage cannot be tolerated. Essential: •Shortage can be tolerated for a short period. Desirable: Shortage will not adversely affect, but may be using more resources. These must be strictly Scrutinized V E D ITEM COST A AV AE AD CATEGORY 1 10 70% B BV BE BD CATEGORY 2 20 20% C CV CE CD CATEGORY 3 70 10% CATEGORY 1 - NEEDS CLOSE MONITORING & CONTROL CATEGORY 2 - MODERATE CONTROL. CATEGORY 3 - NO NEED FOR CONTROL
- 31. SDE ANALYIS Based onavailability Scarce(rare) Managed by top level management Maintain big safety stocks Difficult Maintain sufficient safety stocks Easily available Minimum safety stocks FSN ANALYSIS Based on utilization. Fast moving. Slow moving. Non-moving. Non-moving items must be periodically reviewed to prevent expiry & obsolescence HML ANALYSIS Based on cost per unit Highest Medium Low This is used to keep control over consumption at departmental level for deciding the frequency of physical verification.
- 32. PROCURMENT OF EQUIPMENT Pointsto be noted before purchase of an equipment: •Latest technology •Availability of maintenance & repair facility, with minimum down time •Post warranty repair at reasonable cost •Upgradeability •Reputed manufacturer •Availability of consumables •Low operating costs •Installation •Proper installation as per guidelines
- 33. HISTORY SHEET OF EQUIPMENT : History sheet •Name of equipment •After sales arrangement •Code number •Guarantee period •Date of purchase •Warranty period •Name of supplier •Life of equipment •Name of manufacturer •Down time / up time •Date of installation •Cost of maintenance •Place of installation •Unserviceable date •Date of commissioning •Date of condemnation •Environmental control •Date of replacement •Spare parts inventory •Techn. Manual / circuit diagrams / literatures
- 34. Maintenance sheet: Annual maintenancecontract [AMC] Starting date Expiry date Service / repair description Materials / spares used Cost of repairs In-house Outside agency
- 35. EQUIPMENT MAINTENANCE &CONDEMNATION Maintenance & repairs: Preventive maintenance Master maintenance plan Repair of equipment
- 36. PREVENTIVE MAINTENANCE •Purchase with warranty & spares. •Safeguard the electronic equipments with: (as per guidelines) •Voltage stabilizer, UPS •Automatic switch over generator •Requirement of electricity, water, space, atmospheric conditions, etc. Must be taken into consideration •Well equipped maintenance cell must be available •All equipment must be operated as per instructions with trained staff •Monitoring annual maintenance contracts. (AMC) •Maintenance cell •Communications between maintenance cell & suppliers of the equipment. •Follow-up of maintenance & repair services •Repair of equipment •Outside agencies •In-house facility
- 37. CONDEMNATION & DISPOSAL Criteria for condemnation: The equipment has become: 1. Non-functional & beyond economical repair 2. Non-functional & obsolete 3. Functional, but obsolete 4. Functional, but hazardous 5. Functional, but no longer required
- 38. PROCEDURE FOR CONDEMNATION 1.Verify records. 2. History sheet of equipment 3. Log book of maintenance & repairs 4. Performance record of equipment 5. Put up in proper form & to the proper authority
- 39. DISPOSAL 1. Circulate toother units, where it is needed 2. Return to the vendor, if willing to accept 3. Sell to agencies, scrap dealers, etc 4. Auction 5. Local destruction
- 40. CONCLUSION Material managementis an important management tool which will be very useful in getting the right quality & right quantity of supplies at right time, having good inventory control & adopting sound methods of condemnation & disposal will improve the efficiency of the organization & also make the working atmosphere healthy any type of organization, whether it is Private, Government ,Small organization, Big organization and Household. Even a common man must know the basics of material management so that he can get the best of the available resources and make it a habit to adopt the principles of material management in all our daily activities
- 41. References: 1. Hospital andclinical pharmacy by S.BALASUBRAMANIAN 2. Text of hospital pharmacy by ALWOOD MC and Blackwell 3. wikipedia