Inventory Management Practices and Supply Chain Performance Among Private Hospitals in Nairobi, Kenya

Abstract

Many businesses view inventory management as a crucial part of their efforts to increase customer satisfaction and decrease operating costs. Most companies now understand the importance of careful inventory management to their ability to satisfy customers' needs. This study set out to analyze how different approaches to inventory management affected the efficiency of the supply chains at private hospitals in Nairobi, Kenya. The major objectives of this research were to evaluate the extent to which private hospitals in Nairobi, Kenya are using inventory management methods and to ascertain the effect that these practices have on the supply chain's overall performance at these institutions. Both the transaction cost theory and the resource-based theory served as theoretical foundations for this research. The study sample included 55 privately-owned hospitals situated in Nairobi. The study results suggest that a substantial majority of private hospitals in Nairobi exhibit a considerable degree of implementation of JIT practice and ABC analysis. Nevertheless, the impact of vendor-controlled inventory, EOQ, and ROL on private hospitals seems to be somewhat limited in scope. The findings of the research indicate that the inventory management strategies that have the most significant influence on the performance of the supply chain in private hospitals located in Nairobi, Kenya are JIT and ABC Analysis. Furthermore, it was shown that several techniques, including JIT, EOQ, VMI, and Re-order Level, had differing levels of effect. The research findings indicate that private hospitals used ABC analysis as a means of evaluating the inventory status of products. The supplies in the warehouse of private hospitals were categorized into several classifications of A, B, and C. According to the data presented in the paper, private hospitals may greatly improve their supply chain efficiency by adopting a just-in-time inventory management system. This is due to the presence of accurate records within the stores department, facilitated by the installed inventory system. The research suggests that it would be beneficial for private hospital management to arrange seminars and workshops aimed at providing training to managers in the area of inventory management. The focus of these training sessions should be on the acquisition of new information and comprehension of good inventory management practices, specifically pertaining to the creation of value and the resolution of internal challenges associated with stock control.