Last mile logistics

Distribution

Monitor stock using existing technologies and mHealth

+iSCM-System

Resources

The ‘last mile’ is not a literal mile but is commonly used in the telecommunications industry to describe the final leg of the network that reaches the customer. More recently, the term has been used to refer to the last stage of a supply chain, also seen as the last segment. The ‘last mile’ is often the most complex element of in-country logistics due to the atomization of consignments. For example, the contents of a single container arriving at the port or gateway to a country may be divided into multiple consignments as the goods travel down the supply chain to different regions and distribution centres, increasing the complexity of managing the distribution.

In the area of health commodities, whether they be vaccines or Family Planning (FP) commodities, many donors have already begun to pay attention to the two segments of the supply chain. The first segment usually covers from supplier to the port of entry whereas the second segment encompasses the port of entry all the way to the end-user. Given the high commitments to health commodities, many are concerned that the supply chains in low and middle income countries will not be able to handle the increased influx of commodities, and that commodities may not reach those who need them. Thus, the international community has begun to pay greater attention to last mile delivery of commodities, which includes systems for distribution and redistribution of commodities as well as data collection and tracking of commodities further down the chain as they reach the service delivery points (SDPs). Weak in-country supply chains remain a significant barrier to accessing FP commodities in many countries.

Ensuring an agile and reliable supply chain in-country has a number of benefits including cost-cutting, greater utilisation of the products, greater control over counterfeit drugs and errors. An efficient supply chain can relieve service providers from being caught-up in fire quenching activities in the case of stock-outs or imminent stock-outs.

Strengthening supply chains at the country level requires many programmatic and operational activities, such as advocating for and fostering Government support for supply chain strengthening, advocating for the inclusion of supply issues in national policies and strategies, coordinating the different agencies involved in health supplies, resource mobilization, as well as ensuring adequate training of in-country staff.

Delivery of commodities within the public sector faces many barriers in low and middle income countries. Some of them include but not limited to, security situation, infrastructure, seasonality, lack of data regarding stock on-hand at SDPs, and inadequate training of staff in strategic supply chain management processes.

Distribution

Broadly speaking, there exists two main methods of distribution in-country, namely the push and pull models of distribution with many variations within each category according to the country context.  Push is the traditional model, which is driven by the forecasting of need and characterised by high buffer stocks to ensure commodity security during lead times (i.e. “ship-to-stock”). This method of distribution is so named because it pushes commodities out to SDPs in anticipation of their needs. Typically, the national warehouse will push commodities to the warehouses directly below in the hierarchy of the supply chain rather than to the SDPs directly. Pull systems on the other hand, is demand driven from the SDPs. Thus, distribution of commodities is made in response to an order from the downstream (i.e. “ship-to-order”). Some countries may also have mixed public distribution systems where urban areas operate on pull based model, whereas rural areas receive commodities based on a push model, the Kenya Medical Supplies Agency (KEMSA) operates on a mixed model. A pure pull model presupposes a high investment in infrastructure in the form of modern warehouses, transportation and ICT to facilitate the data flow of stock on-hand. MEDS (Mission for Essential Drugs Supplies) is an example of an organization that has built an effective system based on the pull model.

Another model that has been used in some countries is the so-called informed push model, where the central warehouse pushes commodities directly to the SDP rather than the warehouse directly below them. This system does not have to rely on SDPs informing them about their needs. The anticipation of needs is typically based on forecasting data. An informed push model with direct delivery helps to address many barriers including HR and transport.

Senegal and Zimbabwe are two countries that have implemented an informed push model. In Senegal this system is called “pousse pousse” for FP commodities; please view a presentation of the system here. Information on the system in Zimbabwe can be accessed through the USAID deliver project.

As such, push vs. pull can be viewed or interpreted as mechanisms that address either an environment that requires quick response to unpredictable usage or needs (dysfunctional health programme) vs. optimization of wastage by reducing the cost of carrying excess inventory. 

In the private sector, the pull system is widely used by suppliers to achieve “Just-in-Time” (JIT) delivery. JIT means delivering only what is needed, when it is needed, and in the amount needed.

In effect, rendering the supply chain to become immune to inconsistent inventory, commodity wastage and unreasonable delivery requirements i.e., last minute costly air delivery shipments. Thus, resulting in a more agile supply chain.  This concept is an adaptation of the “Supermarket Method” and a short summary can be accessed through Toyota’s Establishment of the Automotive Business.  

Furthermore, when a pull system is fully operational, it allows an organisation to perform additional methods beyond JIT delivery such as Vendor Managed Inventory (VMI).  More information can be accessed through the USAID DELIVER PROJECT

Monitoring stock using existing technologies and mHealth

The more advanced distribution systems rely on the availability of accurate data of stock on-hand. Real-time monitoring of stock availability is impossible to achieve in a paper-based system. As such, several frugal software solutions have been developed to enable monitoring of stock levels for several types of commodities using mobile phones (mHealth solutions). These software solutions cannot replace a functioning Logistics Management Information System (LMIS). Yet, they can complement LMIS’s by providing real-time data to those overseeing stock at a regional or national level, which then can initiate redistribution efforts amongst SDPs with a high level of stock to those with a low level of stock. We think it is clear that mHealth can and should play a significant role in improving the performance of existing paper-based logistics systems.

 There are several resources to access about using different mobile SMS (Short Messaging Service)-systems for commodity tracking which have been funded by different UNFPA country offices. Some of them can be accessed below:

Sierra Leone:

This 10 minute video documents UNFPA Sierra Leone's partnership with civil society organizations in Sierra Leone in ensuring Reproductive Health Commodity Security (RHCS) and re-positioning family planning. In particular, the documentary focuses on UNFPA country office's partnership with the local civil society network "Health For All Coalition" (HFAC).

This partnership between UNFPA and HFAC in Sierra Leone yielded demonstrable results:

Reduction on the percentage of facilities reporting stock-out of selected Free Health Care (FHC) drugs (for the last six months of the year from 96% in 2011 to 30.5% by end of December 2012 (HFAC monitoring report)

• Major incidences of reported theft of FHC drugs reduced from twelve in 2011 to six in 2012 (HFAC monitoring report)

• Increased accountability in the management and use of drugs; this is evidenced by an increase in the percentage of drugs that were accounted for from the central medical stores to district medical stores, this rose from 50% in 2010 to 94.3% in 2011. In 2012, the figure was at an all-time high of 99.7%.

• Reduction in the level of FHC drugs unaccounted for from the district medical stores to peripheral health units (PHUs) from 26.7% in 2011 to 0.7% in 2012.

• Increased support to the drug distribution system at district level by local councils, Ministries of Health and donor partners.

• Improved coordination between the district health management teams, local councils and Civil society organisations in the drug supply chain management at district level.

• Recognition that HFAC is performing a legitimate and formal monitoring function that has been underscored by the signing of Memorandum of Understanding (MOU) between them and other development partners such as DFID, UNICEF and also with the Sierra Leone Anti-Corruption Commission (ACC).

Key lessons learnt during the implementation of the project were:

• Relationship building with stakeholders in a new initiative such as this is a challenging undertaking. In future, this will be built into a programme plan as a key task to consider from the outset. 

• Identifying key named contacts within stakeholder organisations. It is critical to ensure that communication takes place at the right level and with those who are in the position to influence change.

• Setting up formal processes and ensuring clear lines of communication about those processes to all stakeholders.

• On-going review and evaluation of programme performance and willingness to adapt programme delivery accordingly

• Engaging in open dialogue with partners and donors in relation to problem solving.

• The Minister of Health and the President of the Republic continue to support the role of civil society in monitoring the distribution of drugs. This high level political commitment has lent credibility in responding to the Procurement and Supply Chain Management (PSM)/Reproductive Health (RH) needs of the country.

• Given the key role played by civil society in strengthening RHCS situation in the country, it is essential for a UNFPA country office to continue to strengthen partnerships not only with Government and other UN agencies but also, with all development partners including Civil Society Networks, NGOs, Traditional / Religious Leaders and local communities.

Kenya:

Together with Tupange, Pharm Access Africa Ltd. and the Ministry of Public Health and Sanitation, the UNFPA Kenya country office helped to scale a SMS-system for stock monitoring to three UNFPA focus districts to bolster the logistics system. The system relies on a monthly report on FP commodities being sent by SMS to a designated number. A different SMS must be sent for each commodity. A central server receives each of the messages and aggregates all the data into a format that is easy to use for managers. There is also an option to display the stock levels on Google maps where SDPs with low stock levels are displayed in red, those with nearing critical stock level in yellow and those with an adequate level is displayed in green. This system relies on the participants using their private mobile phones to send SMS messages, but in compensation they receive airtime in excess. A presentation of the system can be accessed here. By displaying their stock levels, managers and the Ministry of Health (MoH) can resupply the SDPs. Preliminary results from some districtis show promise with significant reductions in stockouts. Pelase access the charts here.

Combining a system for SMS based tracking commodities with a local LMIS:

LMIS are complete systems that deal with a complex set of processes and tasks and it is not advisable to build a complete LMIS from scratch out of a local SMS based system since there are many available and well tested LMIS’s in existence. However, using an SMS-system to extend  an existing LMIS solution to accommodate data entry by SMS or population surveys would be a sensible approach. Many existing SMS solutions can be easily adapted to be a SMS add-on to existing systems and extend the reach of applications that require laptops or smart phones - devices that, at scale, are just not feasible in certain hard to reach places outside of urban centres.

 

+iSCM-System

(Click on the image to see it in a larger view )

Schematic of the +iSCM system for enhanced track and trace –the above visual depicts the bar-codes as veins and arteries running throughout the supply chain that ultimately streams vital data flow into the centralised cloud kardia.

13 February 2014 (Copenhagen, Denmark): The Supply Chain Team in UNFPA’s Copenhagen Office is pleased to announce that UNFPA has been awarded two years (2014-2015) funding from the Bill & Melinda Gates Foundation. As one part of the funding, the Supply Chain Team is tasked to complete a feasibility study of the cloud-based integrated (+iSCM) system. The +iSCM system is envisioned to be one of the pinnacle project for UNFPA’s Supply Chain Team by providing real-time data flow across each segment of the supply chain to help achieve enhanced track and trace capability. 

In addition, the Supply Chain Team has established an informal network with other development partners (i.e. USAID, GAVI Alliance, the Global Fund) involved in similar cloud-based track and trace projects to ensure synchronised information sharing and knowledge exchange. This is realisation that the public health supply chains is complex and therefore, cannot be viewed as separate independent supply chains but rather, must be viewed in a holistic manner as symbiotic supply chains.  Thus, allowing organisations to truly capitalise off the investment and work committed by each of respective track and trace projects supported by the various development partners including UNFPA.    

In effect, the +iSCM system will be based on GS1 standards to guarantee global harmonised data collection, analysis and interchange. The McKinsey report,  Strength in Unity: The promise of global standards in healthcare , provides reference to a number of the benefits achieved by using GS1 standards around the world.

For more information regarding the +iSCM project, please contact via email or follow us on twitter @MyRHSupply

Resources:

Reducing stock-outs of life saving malaria commodities using mobile phone text-messaging: SMS for life study in Kenya

In the following we list 6 major LMIS’s related to health care supplies that have been used in many countries around the world that can be used to orient oneself into the possibilities:

Useful resources:

Using Last Mile Distribution to Increase Access to Health Commodities

Outsourcing the Vaccine Supply Chain and Logistics System to the Private Sector: The Western Cape Experience in South Africa

The private sector can offer much in terms of logistics experience and technical know-how. UNFPA’s resource mobilization toolkit can offer guidance in terms of setting up a private sector partnership.

FP commodities are most often integrated into that of normal health commodities. The linked brief from the USAID deliver project recounts some of the advantages of integration.