Fraser Health Authority - Business Consulting Project

Project Details

Project Client: Fraser Health Authority
Project Description: Compare & Analyze Process Policies
Students: Dawn Lesyk and Nic Gaylord
Term: Fall 2012
BCIT Program: Business Operations Management
Fraser Health Authority mixes Centralized Intravenous Admixture Drugs (CIVA) for 12 acute care hospitals located throughout the Fraser Health Geographic Region which services over 1.6 million inhabitants. CIVA Drugs are ordered by hospital pharmacies using one of two distribution policies: Bulk and Patient Specific. A central production facility (The Pharmacy Drug Distribution Centre) mixes CIVA drugs using two manufacturing strategies, Make-to-Stock and Make-to-Order which are based on shelf life and demand pattern with the goal being to minimize stock-outs, waste and age-on-delivery.

A hospital pharmacy using each type of distribution policy was selected for analysis. Hospital 1 uses the Bulk policy while Hospital 2 uses Patient Specific. Due to the high variation in demand for hospital services and CIVA drugs, there is also the possibility of drugs being produced but expiring before being administered.

Fraser Health’s Operations Engineering Team has invited the BCIT Operations Management Program to provide a student team to conduct a distribution and production analysis with respect to the above drug distribution policies.

The purpose of this study was to investigate and identify which policy would minimize dollar and labour costs and CIVA drug waste at both hospitals while meeting demand and maintaining current service levels.

Through interviews, observations, data gathering and other analysis tools, the team provided the following three recommendations:
  1. Hospital 1 should keep the current Bulk Policy, but modify the drugs that are ordered in bulk quantities and transfer those drugs to the Patient Specific Policy.
  2. Hospital 2 should keep the current system and implement process improvement initiatives to reduce administrative time spent on CIVA drug processing.
  3. Evidence of drug waste at local pharmacies justifies a more detailed analysis of the waste. It is recommended that a detailed study be performed on the waste at the hospital pharmacies.