In today’s fast-paced business world, inventory management is essential to the success of any business, and the healthcare industry — in this region specifically — is no exception.
According to a report by ResearchAndMarkets, the UAE healthcare market is expected to grow at a CAGR of 9.9 per cent from 2020 to 2025, driven by factors such as the growing population, the increase in the prevalence of chronic diseases, and the government’s focus on improving healthcare infrastructure. The GCC healthcare market is also expected to grow at a CAGR of 6.3 per cent from 2020 to 2025, reaching a value of US$71.3 billion by 2025. However, it is important to address the growing demand and expenditure by controlling costs and investing wisely in the future, so the healthcare industry is efficient, effective, and patient-centric.
One of the key elements of securing this ideal future is to manage the second highest costs in healthcare after people, i.e., inventory of medical supplies and devices. By maintaining optimal inventory levels, healthcare businesses in the UAE and GCC can reduce inventory costs and improve cash flow. This means they have more money to invest in other areas of their business, such as improving patient care, developing new medical devices and treatments, and providing employee training and development. In addition to financial benefits, effective inventory management also leads to increased patient satisfaction. When healthcare businesses have the right medical products in stock at the right place at the right time, they can fulfil patient orders quickly and accurately, and avoid unnecessary delays in care or surgery cancellations, resulting in satisfied patients that were treated when they needed it most.
Despite the benefits of effective inventory management, many healthcare businesses in the UAE and GCC struggle with common challenges associated with clear visibility of what they have and where, which leads to instances where products are overstocked or out of stock. Excess inventory or overstock ties up capital and takes up valuable storage space. On the other hand, inventory shortages can lead to lost revenue, delays in patient care, and patient dissatisfaction. The challenge of inventory management is further exacerbated as many processes and procedures of managing inventory are heavily dependent on manual work that falls on the shoulders of clinical staff. This leads to the inefficient use of resources, potential manual data entries, inaccurate or labour-intensive inventory counts and audits.
It is estimated that in the UAE alone, approximately Dh7 billion of labour expenditures can be attributed to clinical staff performing non-clinical administrative activities related to inventory management. This is not unique though to just this region. According to a study published by the Journal of Hospital Administration and Management, “The cost of inventory management represents around 35 per cent of a hospital’s supply chain costs, while the remaining 65 per cent is attributed to non-value-added activities, such as receiving, unpacking, and transporting supplies to their final destination.”
This is where inventory management software can be a game changer. By automating inventory management and optimising workflows, healthcare organisations can improve operational efficiency and ensure that clinical staff can focus on delivering quality healthcare services to patients who need them most.
These options provide features that help organisations achieve their goals beyond financial and operational gains, such as:
- Enhanced patient safety by ensuring that the right product is in the right place at the right time.
- Improved clinical outcomes by providing real-time data analytics that enables healthcare organisations to make informed decisions.
- Reduced manual data entry errors through automatic tracking of inventory levels and reorder points.
- Seamless integration with other business systems, such as ERPs and patient management.
In summary, effective inventory management is essential to a healthy, healthcare industry, be it here or globally. As experts in this field, we need to be committed to helping organisations achieve their financial, operational, and clinical goals while ensuring that the right product is at the right place in the right quantity at the right time.
Hamid Dean Refai is General Manager at WebOps, whose expertise lies in healthcare delivery & transformation, management advisory & healthcare consulting, business development & strategy, commercial excellence & partnerships, and P&L leadership. He has led medical projects across the Middle East, US and Singapore, among others.
This article appears in Omnia Health magazine. Read the full issue online today.
