Application of the Hines value chain model by the Kenya Medical Supplies Agency
The Kenya medical supplies agency from its inception in the year 2000 to the year 2007, adopted the Michael Porter’s value chain model (‘push’ strategy) to supply essential drugs to all the public health facilities in the country. Due to the need to focus on service delivery aspects to enhance customer satisfaction in the year 2008, KEMSA started introducing the Peter Hines’s value chain model (‘pull’ strategy) to deliver essential drugs to some of the key hospitals in the country alongside with the push strategy. With these imperatives in mind, the study examined the application of the Hines’s value chain model by KEMSA. The objectives of the study were to first, establish the extent to which KEMSA has adopted the Hines’s value chain model in dealing with the supply of essential drugs to the PHF’s. Second, to determine the challenges associated with the adoption of the Hines’s value chain model and third to identify the benefits of adopting the Hines’s value chain model as compared to the Porter’s model initially adopted by KEMSA in supplying all the PHFs in the country. To explore these issues, primary data was collected via interview from four managers of the core function departments. The findings were then analysed using content analysis. Results of the study indicated that overall adoption of the pull strategy is to a moderate extent because only one third of the health facilities are supplied using ‘pull’ strategy while the remaining two thirds are supplied using the ‘push’ strategy. However the health facilities in the one third category are all key facilities including all the District and provincial hospitals. The extent of adoption was analysed according to the value chain parameters; supply process system, structure and direction, primary activities and secondary activities whereby the findings of the study have shown that KEMSA has adopted most of the practices in relation to these parameters to support the pull strategy. In addition an analysis of the challenges and benefits associated with the adoption of the Hines’s value chain model have been outlined. The challenges include; forwarding of irrational orders by overburdened health workers and occasional training of the health facilities due to staff turnover. Benefits include solving of undersupply and oversupply issues, solving of the accountability problems and enhancement of customer satisfaction objective. However, despite the challenges associated with the adoption of the Hines’s value chain model, it is the preferred strategy by the respondents as they confirmed that the right decision was made in choosing to introduce this strategy and believe that the strategy would be more effective in all players i.e. KEMSA, health facilities, and the ministries (ministry of medical services and ministry of public service and sanitation) played their roles well. On the basis of the study several recommendations were deemed appropriate. The findings seem to point to the need to focus on a few issues in support of the value chain parameters. These are: reduction of lead time, revise the essential medicines list in order to meet and exceed the performance expectations of all levels of the health facilities, the ministries under health to play their roles effectively and enable KEMSA to effect the quantification role and the final issue of concern is for the management to expound their role of enhancing employee participation and empowerment. The limitation of this study related to the scope of the study. The study only focused on one organization that supplies drugs hence the results may not be generalized to other organizations that supply drugs like the missions for essential drugs supply (MEDS). Further research could be carried out in the public health facilities supplied by KEMSA with an aim of determining customer satisfaction levels with the supply process strategy that KEMSA has adopted. In addition further research could also be carried out in MEDS with the aim of establishing the extent to which the organization has adopted the Hines’s value chain model in dealing with the supply of drugs to the mission hospitals in Kenya.