Simulating SKU proliferation in a health care supply chain

This paper investigates stock keeping unit (SKU) proliferation and its impact on a health care supply chain. There are two types of proliferation: acceptance and adoption. The acceptance case occurs when a hospital requests a SKU and the SKU is not carried by the system. The adoption case occurs when the SKU is not carried by the requesting hospital, but is carried by some other hospital within the system. A multi-item, multi-echelon supply chain model with load building and delivery details was constructed to examine cost and performance tradeoffs. Object-oriented modeling and implementation techniques for the SKU proliferation simulation are described. The results indicate that the acceptance and adoption jointly affect the performance of the supply chain in terms of the service level (demand fill rate) and the cost. The models and results provide a test bed for addressing and mitigating the effect of proliferation within healthcare supply chains.