Inventory Policies in Blood Bank Management

Abstract

Blood bank operation is a facility which involves the process of collecting, testing, processing and storing blood for later use in blood transfusion. Blood bank management faces a crucial problem due to shortage of blood supply that sometimes does not meet the demand. Blood inventory is difficult to organize and control especially in festive seasons when demand is high due to road accidents and casualties. Blood bank management needs to balance the demand and supply to avoid shortage, and since blood is perishable, the management also needs to avoid wastage. To solve this issue, an effective inventory method should be implemented. This study compares two policies: the continuous review policy and the periodic review policy. The continuous review policy observes the monitory level more accurately and on time, while the periodic policy applies only periodically inventory control. This study looks at the relationships between the service level, safety stock and inventory cost that are based on three case studies, which are variable demand and constant lead time, variable lead time and constant demand and variable demand and variable lead time. The result shows that the continuous review policy should be implemented in blood bank management due to lower inventory cost and being more systematic with higher efficiency.