Improving Performance of Rural Supply Chains Using Mobile Phones

Abstract

Ensuring availability of essential goods, such as medicines or vaccines, at the point of care in the villages is a significant challenge in rural supply chains. The crux of the problem lies in information asymmetry of supply and demand, as well as ad hoc distribution practices. These supply chains are not managed efficiently, and often information flows upstream in the chain in an incomplete, incorrect and untimely manner. This ultimately affects procurement and distribution decisions, consequently leading to stock outs of important goods at the point of care. To address the problem of stock availability, we have implemented a Bulletin Board that digitally captures needs (demand) and availability (supply) of goods in real-time from any location using low-end mobile phones, and broadcasts this information to vendors and managers, upstream in the supply chain. We demonstrate that by reducing information asymmetry between supply and demand, the overall system self-organizes in a manner that stocks are appropriately re-distributed, thereby improving availability at the point of care. We demonstrate these concepts in the context of vaccine and medicine availability in a public health supply chain. In a study in Karnataka, India, we have observed vaccine stock availability increase to 99% and replenishment responsiveness improve by 64%. However, such an approach relies on obtaining high quality of data from the last mile, which is a big challenge in low-resource environments, where mobile networks are unreliable and human capacity is low. We describe the design of a mobile phone based service that leverages insights from information asymmetry theory and effective service design to achieve sustainable supply chain performance in low-resource environments.