Material management

Material management
• Systematic process of overseeing and
controlling the acquisition and utilization
of supplies to ensure both availability
and cost effectiveness.
 Goals of material management

1. Supplies arrive timely manner.

2. Spoilage is reduced to a minimum.
3. Back orders and delays are avoided.
4. Storage space is used to the best
advantage.
5. The most economically advantageous
price to obtain.
6. Financial resources are not tied up
 Acquisition of new equipment

Traditional procedure of purchasing new

equipment:
1. Developing a budget
2. Accepting request
3. Voting and prioritizing the request
4. Purchasing the highest priority items
allowed in the budget
 Possible appointees to clinical laboratory
equipment committees
TEC members
• Clinical pathologist
• Laboratory manager
• Procurement officer
• Financial service
representative
• Biomedical engineer
• Section supervisor
• Day shift Medical technologist
technical experts
• Technical generalist
• Laboratory computer manager
LAB members
• Chief executive
• Chief financial officer
• Chief operations officer
• Chief medical officer
• Clinical pathologist
• Medical doctors
• Engineering director
• Facilities manager
• TEC- technical evaluation committee
-conducts primary evaluation of equipment
and technologies.
• LAB –laboratory advisory board
-the final review committee, which takes
the recommendations of the TEC for a final
vote.
 Previously owned equipment
• Remanufacturing -the process of the
original equipment of the manufacturer
completely overhauling the equipment
and returning it to service as if it were
new.
• Refurbished or reconditioned – to
cleaned and repaired equipment in
acceptable working order.
 Cautions for buying previously
owned equipment
• Vendor background check:
1. Number of years in business
2. Number of years in present location
3. Educational background
4. References from current and past clients
5. License
 Cautions for buying previously
owned equipment
• Understand the deal:
1. Price of the equipment
2. Terms of purchase
3. Service warranty availability
4. Operational status
a. Fully operational
b. Fully operational but with preventive
maitenance
c. Completely rebuilt
d. Confirm reliability with last equipment
user
 Equipment evaluation

Criteria :
1. Quality of the assays
2. Assay menu/type
3. Turnaround time for STAT and Non-STAT
4. Equipment operation
5. Equipment features
6. Equipment down time
7. Company support
a. Evaluation and training
 b. Sales support
c. Customer support
d. Service support
8. Financial
a. Cost per test
b. Shipping cost
c. Cost per year
9. Current customer response
 Equipment placement and
communication
• Company engineer
-access is possible for transporting the
equipment in the laboratory
• Temperature and humidity
• Staff training
 MAINTENANCE
• TYPES OF MAINTENANCE SERVICES
1. In-house equipment service
2. Manufacturer service
3. Third party service
 MAINTENANCE
• Categories of scheduled maintenance
services
1. Preventive maintenance
- Periodic procedures to minimize the
risk of failure and to ensure continued
proper operation.
2. Functional testing, performance
verification and calibration
- To verify that the equipment is fully
operational.
3. Safety inspection
-A visual inspection for mechanical
safety(eg: cables and handles)
 Supplies

Supplies
• Products that meet specific time and price
criteria.
Purchase order
A document authorizing the purchase of a
product or service from a vendor.
Traveling requisition
A catalog of products used to order supplies
stocked by material management.
Standing orders
-A purchase order issued for a product or service to be
delivered according to present schedule.
Product standardization committee
-representative from all areas of the organization
-review supplies that the hospital uses in large volume

Goal:
-ensure that the best product is obtained
-avoid expensive duplication of products
-to take advantage of volume of discounts
 Inventory management

A continual process of checking stock

levels , rotating stock to ensure
freshness, ordering supplies in sufficient
quantities to meet current needs, and
minimizing the cost of inventory.
 Inventory level checks
• Perpetual systems
A system that keeps account of the
inventory each time a product is used or
removed from inventory.
• Periodic systems
A system whereby inventory levels are
checked according to an established
timetable.
• Random checks
A method used to verify inventory levels.
 Stock Replenishment
Techniques
• Minimum-maximum
• Just -in-time
 Financial control Inventory
• Economic ordering cost
-which answer the question of how much
to order
• Economic ordering point (EOP)/reorder
point(ROP)
-provides the base or safety level for
reordering inventory
• Optimal reorder time (ROT)
-which helps to establish the best time to
order
Annual usage
•

• Historical ordering data based on:

•

• Workload of the laboratory

• Actual purchase and usage
• Predictions of future volume
Average daily usage
•

• Can be obtained by dividing the amount

of supplies ordered in a year by 365
Annual holding cost
•

Cost of carrying
•

• Accounts for the expense of

maintaining a stockroom for storing
material not needed immediately.
Cost per unit
•

This value is obtained by dividing the

•

purchase price by the container size.

Lead time
•

• The amount of time or advance notice,

 Example:
EOQ = 2 x (annual usage x cost of ordering)
annual holding cost per unit
EOP= annual usage x lead time in days
365 days
Or
EOP = (average daily usage x lead time ) + safety
level
• ROT= EOQ x 365 days
annual usage
Example

• Annual usage = 11,000 packs (20

pcs. CM plates per pack)
• Cost of ordering = 25 pesos per
order
• Annual holding cost = 2.50 pesos
per year
• Lead time = 7 days
Example

Answers:
• EOQ = 469 packs/order
• EOP = 211 packs
• ROT = 16 days per order
•

• Interpretation:
•

• 469 packs of 20 pcs CM plates must be

ordered when the inventory reaches 211
packs. The order must be made within
References
•

• Garcia, L.S. et al. (2004). Clinical

Laboratory Management.
Washington, DC: American
Society for Microbiology Press.
• Varnadoe, Lionel A. (1996).
Medical Laboratory
Management and
Supervision: Operations,
Review and Study Guide.
Philadelphia: F. A. Davis