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Inventory management with the help of technology

Let’s move on next part. Inventory management and the procedure from inbound to outbound. The ideal inventory model is the optimal stock movement pattern. Which inventory levels are as low as possible and optimized, consumption patterns are consistent, meanwhile, suppliers always deliver on time. However this model is rarely reached in practice. According to current data from my hospital, we offer near one thousand and five hundred drugs for operation units. Roughly estimate of purchasing cost is 17 billion USD per month. As regarding inventory turnover is around one point seven. As we know, the number of turns in the average-sized hospital differs based on the numbers of beds.
Taipei veterans general hospital is an international medical center composed of 3000 beds, thus, we have to keep many specialized products on hand despite of infrequent used items. Not like smaller institute may allow doing more “just-in-case” stocking. This is why the turnover rate is relatively lower than reference range in my hospital. Technically, the direct way of reducing the holding cost is to control service level and safety stock. Since new drugs continue developing, health systems need to prepare different kinds of drugs providing any types of patients. Balance cost and demand becomes a crucial issue in any pharmacy. An efficient inventory control is not only simplifying workflow process, but also provides direct, real-time system to record document of inventory.
This is why we develop computerized inventory system to keep track of the inventory in storage and on order. Furthermore, in my hospital, we also apply bar code reading to identify received items. It can reduce some problems related to inaccurate data inputs. The figure is an interface of electronic inventory system from my hospital. We usually use this system for receiving products, allocating products to satellite pharmacy or dispensing department, and also dealing with inventory monitoring. Here is a demonstration of receiving process. Suppliers have to deliver the accurate quantity on schedule after receiving the electronic orders. When items come into warehouse, receipt of incoming products and certificate of analysis report of received item should be prepared.
This window contains some information after scanning barcode of received product. Such as drug name, batch number, ordering quantity, expiration date. These data show up automatically; therefore, we can avoid error by manual input. Because we have several pharmacies located on different floors and hospital campus as mentioned in the beginning. The automatic outbound function is useful for every pharmacy to place order automatically from warehouse. On the other hand, the stock in satellite pharmacy can be adjusted back to the warehouse as well if the stock level is beyond demand after regular reviewing. There may be more than one lot number available holding in store at the same time. We will follow the first expired, first out principle to supply operation units.
This function is to make sure that satellite pharmacy had received accurate quantities from warehouse. Here is another function that can offer slight quantity adjustment between two pharmacy sites manually. All I mentioned functions in this system can be manipulated by auto mode and also by manual mode for sure. Since we know both manual and computerized systems perform the same fundamental information-processing tasks. However, some abilities cannot be replaceable to each other. So keeping both functions at the same time is required.

Ms Chen proceeds to explain inventory management, specifying the different considerations to take note of from inbound to outbound.

Key points

The ideal inventory model is the optimal stock movement pattern. Inventory levels are as low as possible, consumption patterns are consistent, and suppliers always deliver on time. However, this model is rarely reached in practice.

To reducing holding costs, one can control service level and safety stock.

It is crucial to balancing cost and demand in any pharmacy. Efficient inventory control should simplify the workflow process, and provide direct, real-time records of inventory.


Computerized inventory system combined with the bar code reading system identifies pharmaceuticals. The systems are applied to both inbound and outbound processes. They are useful for checking inbound drugs, allocating stock. Though an auto mode is available, there are still tasks that require surveillance by a skilled knowledgeable staff.

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How is the stocking system of your hospital like?

Are automatic systems applied at your hospital, or must information be checked and keyed in manually?

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Good Pharmacy Practice: Medication Management

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