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IBM Develops Supply Chain Master Plan for Ghana's Ministry of Health

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IBM DEVELOPS A SUPPLY CHAIN MASTER PLAN FOR
GHANA’S MINISTRY OF HEALTH
www.icvonline.org Center of Excellence for International Corporate Volunteerism Page 1
The Problem
With a decentralized and fragmented health
sector, the Ghana Ministry of Health (MOH)
confronts numerous challenges both in its day-
to-day operations and in its long-term ability to
provide robust medical coverage to its citizens.
The Ministry’s suitable quality of medical
products is limited, a deficit that is amplified by
uneven planning and coordination across the
entire organization. Additionally, a lack of
sufficient visibility and insight into medical data
and weak logistical data lead to occasional
misalignment of health objectives and
incentives.
After a strategic review conducted in June
2011, the Ministry responded to these
challenges. With the support of USAID’s DELIVER
Project, the MOH identified the need for a
comprehensive and coordinated strategic plan
to strengthen the public sector’s supply chain.
The leadership team also decided to create a
five-year Supply Chain Master Plan (SCMP) to
Project at a Glance
Summary
From April to May 2012, an IBM team
worked on a USAID-funded project in
Accra, Ghana, to develop a supply
chain management system for the
Ministry of Health.
This team of 10 IBM Corporate Service
Corps participants were part of a
broader partnership among USAID, IBM,
and CDC Development Solutions that
allows USAID Missions and beneficiaries to
receive pro-bono business and technical
expertise from multinational corporations,
like IBM, through collaborative public-
private partnerships.
Specifically, the team sought to:
• Develop a roadmap for a new supply
chain management unit that supports
the Ghana Ministry of Health.
• Design an information management
system architecture.
• Establish a costing model for the
supply chain’s implementation.
• Conduct a risk assessment for the
plan’s implementation.
“The Supply Chain Management Unit
framework suggested by the IBM
experts will go far in securing increased
access to essential medicines and
health care by Ghanaians,” said Joe
Mensah, IBM Country General Manager
for Ghana. “An enhanced supply chain
management system will lead to overall
affordable and quality healthcare
provided by the Government of Ghana
to its citizens.”
www.icvonline.org Center of Excellence for International Corporate Volunteerism Page 2
boost productivity and efficiency across the
health sector.
The SCMP recommends a series of strategic
interventions and year-by-year activities that will
reinforce supply chain management in order to
better support the MOH’s objectives for a
stronger national health system that both
improves health coverage and addresses
inequalities within regions and districts across
Ghana. Additionally, the SCMP also calls for a
new ‘Supply Chain Management Unit’ (SCMU)
that will act as an administrative body to better
link the public and private health sectors. It will
also create efficiencies across the entire system
of health care planning and delivery in order to
meet demand for medicines in both a timely
and cost effective way.
Before launching the Master Plan, the Ministry
required additional analysis and strategic
planning that would ensure the smooth roll out
of the SCMP and increase efficiencies in its
supply chain.
The Solution
In order to address these obstacles to launch,
the Ministry considered three distinct alternative
solutions. The first was to proceed without further
analysis and evaluation with the plans already
in place. The second was to hire an outside
consulting agency, a cost that would have likely
been too high to bear. The last option was to
explore new avenues for capacity infusion
through partnership. Their openness to this
approach led to pro bono support from a team
of IBM employees from around the world, driven
by the Center of Excellence for International
Corporate Volunteerism.
Before the Master Plan could be completed,
there were key areas requiring additional
analysis and development to ensure the smooth
roll out of the SCMP and ultimately increased
efficiencies in the national supply chain. An IBM
team arrived in Ghana in April 2012 to assess
and address the following factors to improve
the supply-chain management systems:
1. A roadmap for building or purchasing an
Information System that supports health
commodity requirements at all levels of the
public sector health system to ensure the
timely and accurate delivery of products
and information to health actors in the
supply chain across all levels to bring
efficiency and sustainability to the sector.
2. A cost model for the proposed Supply Chain
Management Unit that incorporates the
various service functions the SCMU is
required to perform.
3. An evaluation of risk associated with
implementing the master plan and SCMU,
developing strategies for managing these
risks at critical control points of the SCMP to
ensure efficient implementation on the
ground.
Working in three sub-teams as pro bono
consultants, the IBM teams conducted an
evaluation of the risk associated with
implementing the master plan and forming a
new management unit to oversee this, and they
developed strategies for managing these risks.
Following this evaluation, the team developed
a roadmap for the roll-out of the proposed
SCMP, analyzing the costs and information
technology requirements for establishing an
automated logistics system to ensure that the
right medicines would be ordered, shipped,
delivered, received and available at the
appropriate times.
The IBM teams provided three key
recommendations. First, they recommended
creating a system to better enable informed
decision-making. By identifying and managing
risks at critical control points, the Ministry would
be able to base its decisions on known and
qualified risks, thereby minimizing surprises and
"management by crisis." The teams also
recommended establishing a highly accessible
and visible cost model to enable managers to
“With this health sector Supply Chain
Management Unit, Ghana hopes to
serve as a model for many countries
in Africa and other emerging markets
faced with similar challenges,” Mr.
Samuel Boateng, Director of
Procurement, Ministry of Health said.
www.icvonline.org Center of Excellence for International Corporate Volunteerism Page 3
identify costly medical products and services, to
provide a clear understanding of the total cost
of the supply chain in order to develop
efficiencies within the system. Finally, the team
developed a high-level blueprint for the
development of an information system to
support the delivery of medicines within the
healthcare delivery system.
Results
The team addressing the SCMU information
system recommended the Ministry implement
an Enterprise Resource Planning (ERP) system to
support the health commodity requirements of
the health system. They outlined a high level
roadmap of tasks in order to achieve this
integrated system and recommended
immediate next steps to ensure successful and
swift implementation. The roadmap outlined in
the report included the following:
• Written explanations and recommendations
for potential implementation options, and a
roadmap of tasks to be completed over the
next five years to ensure each could be
achieved.
• Cost-benefit analysis of each
implementation option and a discussion of
value for money in terms of project scale
and timeframe.
• Design of established impact indicators to
be tracked over the coming months, and a
plan that outlines specific milestones for
each of the recommendations to ensure
that the project is on schedule.
• Development of an options framework for
selection of an IT solution, and a defined set
of criteria for evaluating proposed systems.
The team evaluating the Ministry’s financial
infrastructure developed a cost model for
supply chain services for the proposed SCMU
and provided training to representatives of the
Ministry of Health and Ghana Health Services on
the model. In addition to this, the team also
provided stakeholders with information on
potential enhancements to the model, mark up
considerations and best practices for cost
reduction. The roadmap developed, outlines
the next steps to be performed based on the
team’s recommendations, which include:
• Establishment of policies and processes to
enable data gathering for input into the
model
• Review of potential enhancement options
for more complete total costs (Level 2 costs)
• Sharing the cost model across MOH and
GHS, including total costs by region
• Evaluating the costs once the SCMU is
finalized
• Review of different options for decision
making and cost reduction
Implementation of the Supply Chain
Management Unit and Master Plan will drive
significant enhancements and benefits to the
supply chain, but successful implementation will
require careful risk management. Applying an
objective approach will assist the Ministry in
making informed decisions on known
quantified/qualified risks thereby improving the
quality of decisions and increasing the likelihood
of success.
To further advance these goals, the risk
evaluation team identified the risks associated
with the implementation of the Master Plan and
the SCMU and recommended a number of risk
mitigation strategies. They emphasized to
stakeholders that regular risk reviews should be
scheduled and updated at key milestones and
that applying mitigation strategies will
significantly reduce project risk. These
recommendations are compiled in a Risk
Management Plan, which identifies SCMU's
organization, financing, procurement,
distribution, information systems and processes
(LMIS), quantification and product selection,
and policy, legal, and regulatory environment
risks, and their impact on the continued and
effective provision of the services. The plan
addresses risk minimization and mitigation
strategies for the identified risks, with
Governance representing the most important
focus area.
Due to a number of political changes in Ghana,
the SCMU has not yet been implemented, but
the Ministry is grateful for the added insight
gained from IBM’s consultation, and remains
optimistic about the benefits the SCMU’s
implementation will yield once it is in place.
www.icvonline.org Center of Excellence for International Corporate Volunteerism Page 4
About CDS
CDC Development Solutions (CDS) is a nonprofit economic development firm based in
Washington, DC. CDS has over 22 years of experience designing and implementing innovative
private sector development programs in over eighty countries on five continents for a range of
public and private sector clients.
CDS leverages public, private, and volunteer resources to strengthen SMEs and the institutions,
governments, and industries that drive economic growth in emerging markets. In all its work,
CDS strives to create groundbreaking partnerships between the public, private, and social
sectors that leverage the innovation in each to create shared value for clients. Though we
have worked for USAID and other donor agencies for over 20 years, CDS also has many
Fortune 500 private sector partners, including IBM, SAP, Merck, FedEx, John Deere, Pfizer, and
others. CDS mobilizes the best of what the private sector has to offer in conjunction with the
deep local expertise of the public sector to support economic development worldwide.
OUR HISTORY
Since our inception in 1990, CDC Development Solutions (CDS) has rapidly grown in size,
stature, program breadth, and the positive impact we are making on the world. From our
initiating effort to assist the development of private enterprise behind the falling Berlin Wall, we
expanded to serve over 80 developing economies through innovative partnerships and
programs.
OUR VISION
Our vision is of companies, governments, and NGOs working together in new ways to
efficiently increase global well-being through standard business practices. It breaks down the
current model that isolates development as a charitable activity and mainstreams it into
mission-aligned action. The result is resilient development programs strengthened by effective
solutions serving all involved.
OUR WORK
CDS is a recognized nonprofit leader in formulating and executing corporate social
investment strategies for multinational firms. Our two key practice areas are:
Global Citizenship and Volunteerism, which includes our International Corporate Volunteer
(ICV) and MBAs Without Borders programs as well as the US Center for Citizen Diplomacy.
Enterprise and Community Development, which works to build the capacity of locally-owned
businesses to meet market needs for local, regional and global supply chains. Other projects
leverage resources from international aid organizations and foundations in communities
around the world to build capacity, increase access to education, and improve livelihoods.

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IBM Develops Supply Chain Master Plan for Ghana's Ministry of Health

  • 1. IBM DEVELOPS A SUPPLY CHAIN MASTER PLAN FOR GHANA’S MINISTRY OF HEALTH www.icvonline.org Center of Excellence for International Corporate Volunteerism Page 1 The Problem With a decentralized and fragmented health sector, the Ghana Ministry of Health (MOH) confronts numerous challenges both in its day- to-day operations and in its long-term ability to provide robust medical coverage to its citizens. The Ministry’s suitable quality of medical products is limited, a deficit that is amplified by uneven planning and coordination across the entire organization. Additionally, a lack of sufficient visibility and insight into medical data and weak logistical data lead to occasional misalignment of health objectives and incentives. After a strategic review conducted in June 2011, the Ministry responded to these challenges. With the support of USAID’s DELIVER Project, the MOH identified the need for a comprehensive and coordinated strategic plan to strengthen the public sector’s supply chain. The leadership team also decided to create a five-year Supply Chain Master Plan (SCMP) to Project at a Glance Summary From April to May 2012, an IBM team worked on a USAID-funded project in Accra, Ghana, to develop a supply chain management system for the Ministry of Health. This team of 10 IBM Corporate Service Corps participants were part of a broader partnership among USAID, IBM, and CDC Development Solutions that allows USAID Missions and beneficiaries to receive pro-bono business and technical expertise from multinational corporations, like IBM, through collaborative public- private partnerships. Specifically, the team sought to: • Develop a roadmap for a new supply chain management unit that supports the Ghana Ministry of Health. • Design an information management system architecture. • Establish a costing model for the supply chain’s implementation. • Conduct a risk assessment for the plan’s implementation. “The Supply Chain Management Unit framework suggested by the IBM experts will go far in securing increased access to essential medicines and health care by Ghanaians,” said Joe Mensah, IBM Country General Manager for Ghana. “An enhanced supply chain management system will lead to overall affordable and quality healthcare provided by the Government of Ghana to its citizens.”
  • 2. www.icvonline.org Center of Excellence for International Corporate Volunteerism Page 2 boost productivity and efficiency across the health sector. The SCMP recommends a series of strategic interventions and year-by-year activities that will reinforce supply chain management in order to better support the MOH’s objectives for a stronger national health system that both improves health coverage and addresses inequalities within regions and districts across Ghana. Additionally, the SCMP also calls for a new ‘Supply Chain Management Unit’ (SCMU) that will act as an administrative body to better link the public and private health sectors. It will also create efficiencies across the entire system of health care planning and delivery in order to meet demand for medicines in both a timely and cost effective way. Before launching the Master Plan, the Ministry required additional analysis and strategic planning that would ensure the smooth roll out of the SCMP and increase efficiencies in its supply chain. The Solution In order to address these obstacles to launch, the Ministry considered three distinct alternative solutions. The first was to proceed without further analysis and evaluation with the plans already in place. The second was to hire an outside consulting agency, a cost that would have likely been too high to bear. The last option was to explore new avenues for capacity infusion through partnership. Their openness to this approach led to pro bono support from a team of IBM employees from around the world, driven by the Center of Excellence for International Corporate Volunteerism. Before the Master Plan could be completed, there were key areas requiring additional analysis and development to ensure the smooth roll out of the SCMP and ultimately increased efficiencies in the national supply chain. An IBM team arrived in Ghana in April 2012 to assess and address the following factors to improve the supply-chain management systems: 1. A roadmap for building or purchasing an Information System that supports health commodity requirements at all levels of the public sector health system to ensure the timely and accurate delivery of products and information to health actors in the supply chain across all levels to bring efficiency and sustainability to the sector. 2. A cost model for the proposed Supply Chain Management Unit that incorporates the various service functions the SCMU is required to perform. 3. An evaluation of risk associated with implementing the master plan and SCMU, developing strategies for managing these risks at critical control points of the SCMP to ensure efficient implementation on the ground. Working in three sub-teams as pro bono consultants, the IBM teams conducted an evaluation of the risk associated with implementing the master plan and forming a new management unit to oversee this, and they developed strategies for managing these risks. Following this evaluation, the team developed a roadmap for the roll-out of the proposed SCMP, analyzing the costs and information technology requirements for establishing an automated logistics system to ensure that the right medicines would be ordered, shipped, delivered, received and available at the appropriate times. The IBM teams provided three key recommendations. First, they recommended creating a system to better enable informed decision-making. By identifying and managing risks at critical control points, the Ministry would be able to base its decisions on known and qualified risks, thereby minimizing surprises and "management by crisis." The teams also recommended establishing a highly accessible and visible cost model to enable managers to “With this health sector Supply Chain Management Unit, Ghana hopes to serve as a model for many countries in Africa and other emerging markets faced with similar challenges,” Mr. Samuel Boateng, Director of Procurement, Ministry of Health said.
  • 3. www.icvonline.org Center of Excellence for International Corporate Volunteerism Page 3 identify costly medical products and services, to provide a clear understanding of the total cost of the supply chain in order to develop efficiencies within the system. Finally, the team developed a high-level blueprint for the development of an information system to support the delivery of medicines within the healthcare delivery system. Results The team addressing the SCMU information system recommended the Ministry implement an Enterprise Resource Planning (ERP) system to support the health commodity requirements of the health system. They outlined a high level roadmap of tasks in order to achieve this integrated system and recommended immediate next steps to ensure successful and swift implementation. The roadmap outlined in the report included the following: • Written explanations and recommendations for potential implementation options, and a roadmap of tasks to be completed over the next five years to ensure each could be achieved. • Cost-benefit analysis of each implementation option and a discussion of value for money in terms of project scale and timeframe. • Design of established impact indicators to be tracked over the coming months, and a plan that outlines specific milestones for each of the recommendations to ensure that the project is on schedule. • Development of an options framework for selection of an IT solution, and a defined set of criteria for evaluating proposed systems. The team evaluating the Ministry’s financial infrastructure developed a cost model for supply chain services for the proposed SCMU and provided training to representatives of the Ministry of Health and Ghana Health Services on the model. In addition to this, the team also provided stakeholders with information on potential enhancements to the model, mark up considerations and best practices for cost reduction. The roadmap developed, outlines the next steps to be performed based on the team’s recommendations, which include: • Establishment of policies and processes to enable data gathering for input into the model • Review of potential enhancement options for more complete total costs (Level 2 costs) • Sharing the cost model across MOH and GHS, including total costs by region • Evaluating the costs once the SCMU is finalized • Review of different options for decision making and cost reduction Implementation of the Supply Chain Management Unit and Master Plan will drive significant enhancements and benefits to the supply chain, but successful implementation will require careful risk management. Applying an objective approach will assist the Ministry in making informed decisions on known quantified/qualified risks thereby improving the quality of decisions and increasing the likelihood of success. To further advance these goals, the risk evaluation team identified the risks associated with the implementation of the Master Plan and the SCMU and recommended a number of risk mitigation strategies. They emphasized to stakeholders that regular risk reviews should be scheduled and updated at key milestones and that applying mitigation strategies will significantly reduce project risk. These recommendations are compiled in a Risk Management Plan, which identifies SCMU's organization, financing, procurement, distribution, information systems and processes (LMIS), quantification and product selection, and policy, legal, and regulatory environment risks, and their impact on the continued and effective provision of the services. The plan addresses risk minimization and mitigation strategies for the identified risks, with Governance representing the most important focus area. Due to a number of political changes in Ghana, the SCMU has not yet been implemented, but the Ministry is grateful for the added insight gained from IBM’s consultation, and remains optimistic about the benefits the SCMU’s implementation will yield once it is in place.
  • 4. www.icvonline.org Center of Excellence for International Corporate Volunteerism Page 4 About CDS CDC Development Solutions (CDS) is a nonprofit economic development firm based in Washington, DC. CDS has over 22 years of experience designing and implementing innovative private sector development programs in over eighty countries on five continents for a range of public and private sector clients. CDS leverages public, private, and volunteer resources to strengthen SMEs and the institutions, governments, and industries that drive economic growth in emerging markets. In all its work, CDS strives to create groundbreaking partnerships between the public, private, and social sectors that leverage the innovation in each to create shared value for clients. Though we have worked for USAID and other donor agencies for over 20 years, CDS also has many Fortune 500 private sector partners, including IBM, SAP, Merck, FedEx, John Deere, Pfizer, and others. CDS mobilizes the best of what the private sector has to offer in conjunction with the deep local expertise of the public sector to support economic development worldwide. OUR HISTORY Since our inception in 1990, CDC Development Solutions (CDS) has rapidly grown in size, stature, program breadth, and the positive impact we are making on the world. From our initiating effort to assist the development of private enterprise behind the falling Berlin Wall, we expanded to serve over 80 developing economies through innovative partnerships and programs. OUR VISION Our vision is of companies, governments, and NGOs working together in new ways to efficiently increase global well-being through standard business practices. It breaks down the current model that isolates development as a charitable activity and mainstreams it into mission-aligned action. The result is resilient development programs strengthened by effective solutions serving all involved. OUR WORK CDS is a recognized nonprofit leader in formulating and executing corporate social investment strategies for multinational firms. Our two key practice areas are: Global Citizenship and Volunteerism, which includes our International Corporate Volunteer (ICV) and MBAs Without Borders programs as well as the US Center for Citizen Diplomacy. Enterprise and Community Development, which works to build the capacity of locally-owned businesses to meet market needs for local, regional and global supply chains. Other projects leverage resources from international aid organizations and foundations in communities around the world to build capacity, increase access to education, and improve livelihoods.