Keeping Rural Health Clinics in Developing Countries from Running Out

Thursday, June 17, 2021

Karthik Natarajan
Assistant Professor Karthik Natarajan

Supply chains are complex. For public health clinics in developing countries, the complexities can have profound effects on people’s well-being. What happens, for instance, if a clinic runs out of an essential item, such as antiretrovirals or antimalarials?

This “stock-out” problem is the subject of a forthcoming paper in the journal Production and Operations Management. Amir Karimi, a 2020 Carlson School Ph.D. graduate, wrote the paper along with the members of his dissertation committee in the Carlson School’s Supply Chain and Operations Department: Assistant Professor Karthik Natarajan, Associate Professor Anant Mishra, and Professor Kingshuk (KK) Sinha. Karimi is now on the faculty of the University of Texas at San Antonio College of Business.

The paper is based on analysis of data collected over multiple years at public health clinics in developing countries where stock-outs have been a problem for numerous health commodities, including antimalarials, HIV medications, and contraceptives.

Professor KK Sinha
Professor Kingshuk (KK) Sinha

As Sinha notes, “the vast majority of developing countries’ healthcare delivery happens through these public health clinics,” and many of these clinics are located in impoverished areas. Over the past 10 to 15 years, rural communities have become more aware of the clinics in their area and all the services that these facilities can provide. But with demand for these clinics’ services rising, “it doesn’t seem as if public health supply chains have progressed in concert,” Mishra says. “You don’t have a commensurate investment in infrastructure.” As a result, “the stock-out problem is becoming more prominent.” 

In this paper, the researchers chose to focus on contraceptives. “They are one of the most typical global health commodities out there,” Natarajan says. And if people can’t get access to them, he adds, “there could be economic, social, and psychological consequences because of unwanted pregnancies.”

Contraceptives are available in many forms, which reflects, to an extent, the variety of healthcare commodities available worldwide.

Profile Photo
Associate Professor Anant Mishra

“This is not to say that you have an accurate representation of the entire global health world,” Natarajan admits. “But at least there is variation within the contraceptive set.” In addition, health ministries in developing countries “are often pushing for offering more varieties of contraceptives to the public,” he says. “So you’re providing more choices, you’re expanding access. But what we find is that there is a downside of this. The more choices you offer, the higher the likelihood of stock-outs of each contraceptive type.”

Clinics located in urban areas can significantly reduce the chance of stock-outs by daily updating of inventory records via logistics management information systems (LMIS). However, in rural facilities, the paper’s research reveals, daily updating can work only when used in conjunction with an electronic LMIS. Where access to funding is limited, Mishra notes, “you’re probably going to get more bang for your buck investing in electronic LMIS for rural facilities.” With warehouses close by, urban facilities are less likely to require electronic LMIS.

Rural clinics “focus their efforts on providing care, not inventory management,” Sinha says. In order for daily inventory updating to work, governments and non-government organizations that support rural health clinics in developing countries, will need to train clinic staff in how to use digital LMIS technology. That would go a long way to preventing stock-outs. And that, in turn, would reduce the danger that people will be unable to get the healthcare products and services that often are desperately needed.

This article appeared in the Summer 2021 Discovery magazine

In this issue, Carlson School faculty research studies the wisdom of the crowds, the role of religion in the gender wage gap, the impact of cash injections, and highlights many others areas where our research has had an important impact.

Summer 2021 table of contents