The Role of Just-In-Time in Purchasing Management in Hospitals

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Table of Contents

Abstract3

Introduction4

JIT inventory management systems in hospitals6

Lean management at hospitals6

JIT and temporary employees8

Reducing costs through JIT and stockless inventory systems9

JIT management11

JIT in hospital pharmacies12

Logistics in hospitals14

JIT in hospitals14

Conclusion16

References18

The Role of Just-In-Time (JIT) in Purchasing Management in Hospitals

Abstract

The JIT philosophy plays an important role in the purchasing management of hospitals. Most hospitals have totally eliminated their inventories, including those of medicines, through implementing JIT. The JIT has been very profitable and beneficial for the hospitals. Through implementing the JIT and its higher version of stockless inventories, the hospitals shift their essential purchase and inventory management functions over to the vendors. Accordingly, the JIT vendors are able to provide no stock, or stockless inventories of all products to the hospitals. These stockless inventories also extend to the hospital pharmacies. Then, the hospitals experience greatly reduced inventories and more cash balances. Furthermore, these inventory arrangements also result in higher service levels and increased profits for the various hospitals. Hence, the JIT vendor also acts as the virtual distribution center of various hospitals. Then, the hospitals do not have to deal with stock outs for vital drugs and medicines nor have to worry about expiring drugs which would have to be thrown out. Hence, most hospitals have now adopted the higher version of JIT which is the stockless inventory. Yet, the hospitals also implement other total quality management concepts related to JIT, such as the Kanban. Then, the hospitals are able to achieve higher qualities in their inventories. Still, the hospitals do not have to worry anymore about their stocks of inventories.

Introduction

Just-in-time (JIT) is an inventory management technique that aims to achieve zero inventories in all of the phases of the production, manufacturing, retailing, or use. Furthermore, JIT aims to achieve zero inventories not only within the organization, but across the organizations in the entire supply chain. Hence, it is not only the company which implements JIT, but also the suppliers and their suppliers implement and switch to JIT. Furthermore, it is not only about the stock control but encompasses the entire management control which has to be made JIT.

Accordingly, any deficiencies in the quality delivered by the supplier will result in the organization needing to keep stocks of raw materials or supplies. This would happen as there will be concerns with respect to the quality delivered by the single or multiple stockholders. Then, there will also be concerns with respect to quantity delivered by the supplier. Hence, there will be multiple shortcomings of the various suppliers which will require the need for the organization to keep the inventories of raw materials or supplies.

Furthermore, it is not only the deficiencies and problems with the suppliers, but the organization itself may have many problems that hinder the organization's ability to not keep any stocks. These deficiencies represent those including problems in forecasting, quality-related losses on all products, machine breakdown and a host of other causes. It is also clear that there will ...