Increasing Efficiency at EPSA Hubs: Center of Excellence

November 4th, 2019 | News

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Despite several improvements, the Ethiopian Pharmaceutical Supply Agency (EPSA) continues to grapple with numerous challenges that hamper consistent availability of medicines across the supply chain and the efficiency and effectiveness of the institution. Warehousing and distribution practices did not meet the internationally recognized standards and practices.

In early 2018, USAID Ethiopia asked John Snow, Inc., through the AIDSFree project, to support the establishment of a Center of Excellence (COE) at EPSA’s Addis Ababa and Adama hubs. These two hubs were chosen by EPSA given their size and proximity to the main Addis Ababa warehouse.

The main aim of the COE was to implement internationally recognized supply chain practices, efficiently utilize the existing and in-construction warehouse infrastructure, alleviate the supply chain operational challenges, build staff capacity and introduce a data driven performance management culture at the two designated EPSA hubs. JSI contracted Imperial Health Sciences (IHS), an internationally reputable firm with hands-on experience operating healthcare supply chains that meet global quality standards in developing countries, to lead the work and achieve the following objectives:

  1. Recommend and implement specific operational process improvement initiatives to drive performance, visibility and transparency
  2. Facilitate the re-organization of EPSA’s warehousing facilities, optimize the inventory management processes and strengthen the distribution process
  3. Provide on-site operational and management skills enhancement and foster a data and performance driven culture within each hub management team

Operational process improvement 

The Center of Excellence proved to be an immediate success by delivering significant and measurable improvements at both facilities against established World Health Organization (WHO) best practices. Warehousing operations in Adama hub jumped to a score of 2.11 compared to the baseline score of 0.97, while Addis warehouses achieved a score of 1.65 compared to the initial score of 0.77 (a score of three is satisfactory).

Warehousing and Inventory Management Optimization

To improve EPSA’s operational efficiency, JSI in collaboration with IHS, supported EPSA to reorganize and optimize their warehouse space utilization. Storage space utilization at the central warehouse improved by 23.5% freeing up an additional 1,482 pallets spaces through implementation of smart storage systems, de-junking of the warehouses, disposing of expired and damaged commodities, creating a palletized environment and adding cross aisle beams.

Images of EPSA’s Adama warehouse before reorganization                    

Images of EPSA’s Adama warehouse after reorganization

Operational and Management Skills Enhancement

To build the capacity of EPSA staff in warehousing operations management, modular and technical on-the-job training was given to 156 central team staff in Addis Ababa and 121 Adama hub staff. Capacity building and skills transfer to staff was developed and monitored through the Personnel Effectiveness Review (PER) approach. This methodology supports the development of staff through coaching based on the elements of work aligned to job descriptions and related SOPs.

One of the main challenges of EPSA hubs in Addis Ababa and Adama prior to the COE was a lack of routine use of data generated by the information systems to monitor and optimize various business processes. The project completed mid- and post-intervention assessments through an independent evaluation carried out by Wits University. According to the assessment results, notable improvements were observed in the areas of floor maintenance, use of Material Handling Equipment (MHE), use of labels and pallet wraps, creation of pick faces, staff reallocation and clarification of roles and responsibilities for perpetual inventory (PI) and annual stock counts including:

  • Inventory accuracy increased at EPSA Central from 36% to 57% and Adama from 42% to 87%.
  • Perpetual inventory introduced with 120 cycle counts per day in Adama and 280 at central warehouse

Next Steps

EPSA is now in the process of scaling the COE model to its network of 19 hubs with support from JSI and Celsian Consulting.

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