msd medical stores department 1 &SP EMT MEETING 18 Sept 2015

msd medical stores department Presentation Plan 2 Action items from last O&SP Meeting O&SP Month review

msd medical stores department Presentation Plan 3 Action items from last O&SP Meeting O&SP Month review

msd medical stores department Action items from last EMT O&SP meeting 4 S/NOwnerAction ItemDue Date Status 1SPMMake follow up on replacement of ZENUFA Products10-Aug Replacement has started. 2.Negotiation required for the items which has price disparity 2DPAward another supplier to supply KEKO Pharmaceutical products25-Aug-2015 In progress 3DPF Suppliers with contract of priority items to be given priority in the payment plan05-Sep-2015 Finance is implementing this as funds get available. 4DP/DCZOPre-bidding meeting with Zonal Private wholesalers30-Sep-2015 In progress 5Zones To use call off contract for non-catalogue items to meet customer needs On going In progress 6CSM To write letter to TFDA to inquire zonal/regional importers and whole sellers31-Aug In progress 7ZonesTo send RFQ’s to zonal suppliers for price comparison10-Sept-2015 In progress 8DGTo delegate the call off ceiling of 10 million to zones04-Sept-2015 In progress 9CSM In order to comply with letter from PMO-RALG, CSM to ask all customers to submit their quarterly order to Zonal Managers in advance for planning purposes. Their orders must be supported with fund commitment03-Sept-2015 In progress 10CSM To inform PMO-RALG on the measures taken by MSD to comply with the letter from his good office04-Sept-2015 In progress 11DFPTo share payment plan to all stakeholders31-Sept-2015 ???? 12DFP To give assurance to suppliers on the payment of their debt and at the same time to speed up replenishment to central warehouse10-Sep-2015 In progress

msd medical stores department Presentation Plan 5 Action items from last O&SP Meeting O&SP Month review

msd medical stores department Introduction  Operations and Sales Planning (O&SP)- is a set of cross- functional processes that optimize demand, supply, revenue, cost, risk and opportunity  The process consists of two bimonthly stock tracking meetings, one monthly O&SP directors meeting, and one monthly EMT meeting 6

msd medical stores department Introduction… The objectives of these processes are to proactively  manage stock outs,  to improve inventory management,  to ensure a realistic annual forecast,  to effectively manage changes to the O&SP Plan,  to measure performance,  and to build collaboration throughout the organization. 7

msd medical stores department Introduction… MSD business is segmented in three categories 1.Normal business which cover catalogue products which are about VP business which includes all products under VP programs 3.Special business which includes all items we buy as needs arise. Our main focus is in normal business. Categories;  High priority items which are 139 items  Routine items which are about 528 items 8

msd medical stores department Stock Status Assumptions: Month of Stock (MoS) = Stock on Hand (SoH)/Average Month Forecast (AMF) 9 LevelsZonal LevelCentral Warehouses Out of StockMoS <1MoS <3 OverstockedMoS >6MoS >12

msd medical stores department Stock status for MSD priority items 10 Normal High Priority Items Month in StockHQ% HQAll Zones% All ZonesMSD%MSD %117.9%96.5%Out of Stock < %2920.9%2820.1%Below Safety Stock %4028.8%2618.7%Safety Stock %2920.9%2316.5%Minimum stock %139.4%1611.5%Working stock %42.9%75.0%Desired Stock > %139.4%3021.6%Overstock Grand Total % % % Risk Area

msd medical stores department Stock status for MSD priority items 11 Jul-15Aug-15Sep-15 DESCRIPTIONMSDPHFs MSD PHFsMSDPHFs Stocked out 41%7%45%30%55%35% Overstocked 22%0%20%0%20%0% Adequately stocked 37%83%35%60%25%55% Not reported 0%10%0%10%0%10%

msd medical stores department 12 Delivery schedule status for priority items  Value of items in pipeline: 38.5 billion.  Value of items overstocked 52.5 billion.

msd medical stores department Items with dispute 13

msd medical stores department Items supplied by KEKO Pharmaceuticals 14

msd medical stores department Suggested way forward 15 Overstocked Not to initiate new delivery and suspend existing Sell on credit to customer with FDDF data/Out stocked customers Discount Price Stocked out Give priority of paying Supplier with fast moving items Procure from Prime vendors Consider replacing Keko with other supplier Disputed item Expedite collection of Keko and others Expedite replacement for Zenufa and others Look for alternative suppliers for Keko products Supplier payment Establish payment plan Negotiate with suppliers Establish payment agreement

msd medical stores department Thank you 16