Stock-outs reduce revenues and frustrate customers in any business, but in the healthcare industry product shortages can also adversely affect human health.
In order to address this problem companies need to know the causes, and there are a number of well-known candidates such as forecast error and product changes. However, until a detailed analysis is carried out, the precise reasons are unknown and can be misconstrued – as happened at a leading pharmaceutical manufacturer referred to as PharCo.
The researchers completed a carefully structured, customized root cause analysis to identify the company’s stock-out problems, and recommend ways to fix the supply gaps.