CHAPTER ONE

INTRODUCTION

1.1       Background of the Study

Logistic management deals with planning and control of both public and private sectors. Generally speaking the mission of logistics management is to get the right materials to the right materials to the right place at the right time, while optimizing a given performance measure (e.g minimizing total operating costs and satisfying a given set of constraints (eg budget constraints). Logistics is one of the most important activities in modern societies (Adriane, 2011).

The aim of logistics management system is to supply customers efficiently with their required products. Each sub-system controls the size of the flow of materials through the system via storage, transportation and various stages of handling for value. The logistics systems do not only consist of flows of materials, components and products which are processed and distributed to customers, but also include supply chain flows of spare parts and return flows of defective and used  products and packaging (Jonsson, Rubberg and Holmberg (2013).

Supply chain management in public health sector has received increasing attention in recent years, as both a priority and a challenge for many countries since government find themselves stressed with an increasing number of products, programs and patients to manage. Due to major increase in funding and donor support for a multiplicity of Health programs, supply chain mangers may be responsive for large number and volume of products, but with limited additional resources to expand their capacity to manage, store, and distribute these products. Often, staff already working in this area receives extra pressure to build up internal capacity to meet the service delivery target, however, many countries faced with this type of challenge, recognized that these functions that were once auxiliary to the primary function of service delivery to patients, could tie up a significant portion of their budgets should they scale up appropriately (United State Agency of international Development USAID, 2010).

Primarily, logistics management is about specifying the size and placement of the goods that a company has in stock. Logistics management is often important for numerous departments within a facility in order to protect the planned cost of production against the possibility of running out of critical stock or goods. It represents one of the most important assets that most firms possess, because the run over of inventory represent one of the primary sources of revenue generation and subsequent earning for the company (Fernazeh, 2012)

The public health facilities in Kaduna state, Nigeria are grouped into state owned facilities and Federal government facilities. Looking at the state public health sector there are primarily, secondary and one tertiary facility located in Kaduna metropolis. Laboratory services are essential for the management of patients with various disease conditions. However logistics management is required for effective management of these patients. The laboratory services require trained personnel and logistics management in order to achieve optimum performance in the quality of diagnostic services in patients’ management. Due to bureaucracy in government the supply chain takes a longer period before products or inventory are supplied to the hospitals and this leads to prolonged lead time in the supply system and subsequently results to out of stock in laboratory consumables and equipment. This tends to have a negative effect on patients management.

If logistics system provides a reliable supply of commodities, more people are likely to use health services. An effective supply chain contribute to improved cost effectiveness in all parts of a program and it can stretch limited resources, strengthening and maintaining the logistics system is an investment that pays in three ways (i) it deduces losses due to overstock, waste, expiry, damage, pilferage and inefficiency (ii) It protects other major programs investment and (iii) it maximizes the potential for cost recovery and advancement of health care delivery (Hong, Kim and Dobriizy, 2012).

A well-functioning health system requires a robust financing mechanism, well trained personnel, availability of stock and timeliness in the supply of commodities through effective logistics management system to deliver quality commodities coupled with good information technology, transportation and appropriate warehousing (World Health Organisation WHO, 2012)

1.2       Statement of the Problem

The health system globally faces a number of challenges of which Kaduna is not an exception. Logistics management system plays an important role in ensuring that consumable and medical equipment are sourced and delivered within reasonable time in order to serve their purpose. The Kaduna state medical store supply agency is given the mandate of procuring and delivering items to various public hospitals within the state, delay in the supply of laboratory items is due to poor logistics management that leads to high lead time and this may affect the efficiency and effectiveness of medical laboratory services and in turn may lead to customer (Patients) dissatisfaction. Out of stock is a recurrent issue that affects the availability of stock due to certain factors like bureaucracy in government, management policies and delay in ordering from the end users and most importantly delay in the release of funds for the purchase of these items. If the supply chain system is faulty where there is uncertainty in the demand the suppliers tend to delay their supply and also this affects the manufacturing companies of the laboratory items which directly have effect on the supply chain system that leads to poor logistics management of laboratory items.

1.3       Research Questions

        i.            To what extent does demand variability impacts on logistics management of some public laboratories in Kaduna metropolis?

      ii.            How does the product utilization rate affect logistics management of some public laboratories in Kaduna metropolis?

    iii.            To what extent has transportation of products affect the logistics management of some public laboratories in Kaduna metropolis?

    iv.            What is the impact of availability of information on logistics management of some public laboratories in Kaduna metropolis?

1.4       Research Objectives

The major objective of the study is to determine the impact of logistic management on the lead time of some public laboratories in Kaduna metropolis.

Other specific objectives are:

        i.            To determine the extent of demand variability impacts on logistics management of some public laboratories in Kaduna metropolis.

      ii.            To find out how product utilization rate affects the logistics management of some public laboratories in Kaduna metropolis.

    iii.            To determine the extent of transportation of products on the logistics management of some public laboratories in Kaduna metropolis.

    iv.            To find out the impact of availability of information on logistics management of some public laboratories in Kaduna metropolis.

1.5       Research Hypothesis

      i.              Demand variability has no significant impact on logistics management of some public laboratories in Kaduna metropolis.

      ii.            The product utilization rate has no significant impact on logistics management of some public laboratories in Kaduna metropolis.

    iii.            Transportation of products does not have significant impact on the logistics management of some public laboratories in Kaduna metropolis.

    iv.            Availability of information of the product does not have significant impact on logistics management of some public laboratories in Kaduna metropolis.

1.6       Scope of the Study

1)      The study is focused on assessing logistics management and lead time in some public laboratory services in Kaduna metropolis.

2)      The respondents are strictly qualified personnel form all Laboratory departments and their store officers.

3)      The period of the study is  2010 – 2015

1.7       Significance of the Study

The public health sector in Kaduna state Nigeria is faced with a number of challenges that leads to inefficiencies. Logistics management is one of these challenges. This study can help the stakeholders in the public health care in Kaduna Nigeria to know the factors that affect the management of inventory and the efficiency of supply chain. The Kaduna state government may also find this study important for decision making in the area of improving the public health care institution through efficient logistics management. This study can also be a benchmarking tool for the government of Kaduna and other states in Nigeria who are challenged by poor logistics management to improve in moving medical laboratory supplies to various Health facilities accross the state in order to serve patients. Researchers alike will find the contribution of this study timely for research purposes.

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