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Project
Inventory Management for Penda Health

Penda Health requested support with their inventory management policy, with the ultimate goal of achieving a greater service level for approximately 200 pharmaceutical drugs. By incorporating a periodic review system with a base order up-to level for all drugs, a dynamic and easy-to-use user interface was provided, where Penda Health employees will get the optimal order recommendation for each drug in order to achieve a 95%, 90%, or 85% cycle service level (terminology definitions can be found in Appendix A). The model provides a dramatic improvement of cycle service level for all of their drugs when applied to historical data, as can be seen below in Figure 1.

Target CSL CSL in Current Policy Historical CSL Achieved in Proposed Policy CSL Improvement
95% 58% 96% 38%
90% 53% 90% 37%
85% 63% 89% 26%
Avg. for All Drugs 57% 92% 35%

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Team: Aylin Elmaagacli, Zueber Juma, Theo Kelly, Tracy Koczela, Bryan Murphy, Pablo Garza Villarreal
Advisors: Professors Werwath and Klabjan