The Ethiopian Pharmaceutical Supply Service (EPSS) has made remarkable strides in revolutionizing the country’s pharmaceutical supply chain, culminating in its recognition as the Grand Prize winner at the 2024 Global Health Supply Chain Summit held in Lagos, Nigeria. This prestigious award reflects years of dedicated effort, strategic planning, and a commitment to delivering essential medicines efficiently and affordably to millions of Ethiopians.

A Vision for Change

EPSS embarked on its transformative journey with a clear objective: to address systemic challenges within the pharmaceutical supply chain and implement tangible improvements across its operations. Central to this transformation has been the adoption of the KAIZEN philosophy, which emphasizes continuous improvement through collaborative daily work management. This approach has led to breakthrough innovations targeting critical bottlenecks in supply chain processes and systematic engagement of leadership for effective change management and sustainability.

One of the most significant achievements during this transformation has been the dramatic improvement in inventory accuracy, which surged from 90% to an impressive 99.8%. This enhancement not only streamlined warehouse operations but also ensured that life-saving medicines are available when and where they are needed most. Additionally, distribution costs have decreased from 0.9% to 0.5%, while proof of delivery rates improved from 89% to 98%.

Streamlining Operations

The reduction in order processing lead times has been particularly noteworthy, with some hubs experiencing a decrease from six days to just eight hours. This remarkable enhancement has significantly increased the responsiveness of the supply chain to customer demand, ensuring that healthcare providers have timely access to essential medications.

Another transformative milestone was the optimization of warehouse layouts. By redesigning storage spaces and implementing advanced racking systems, EPSS achieved full utilization of its facilities, freeing up approximately 744 square meters of valuable space. This redesign not only created safer working environments but also reduced the distance workers traveled within warehouses from 77 kilometers to just 17 kilometers per month. Such improvements have saved time and boosted productivity.

Embracing Digital Transformation

Digital transformation has been at the core of EPSS’s journey towards operational excellence. By leveraging advanced digital dashboards and data visualization tools, EPSS has revolutionized its decision-making processes, providing real-time insights into supply chain performance. These tools have enhanced visibility across operations, enabling the organization to proactively respond to emerging challenges and maintain a steady flow of essential commodities.

For instance, the introduction of innovative near-expiry visualization systems has helped reduce wastage rates from 1.8% to under 0.8%. This initiative not only saved resources but also strengthened trust with stakeholders and partners by ensuring that valuable medicines do not go unused due to expiration.

Building a Culture of Continuous Improvement

Beyond operational achievements, EPSS has fostered a cultural transformation within its workforce. By training over 1,500 employees in Lean and KAIZEN principles as well as supply chain fundamentals, EPSS has built a culture characterized by accountability, teamwork, and continuous learning. Daily KAIZEN boards and project governance systems have become integral in maintaining momentum for improvements and ensuring that successes are scaled across all operational hubs.

The establishment of an Improvement and Skilling Center at EPSS headquarters and selected hubs has further institutionalized this culture of continuous improvement. These centers focus on integrated project management, enhancing accountability across the organization, knowledge management, and facilitating reward and recognition systems for outstanding performance.

Commitment to Sustainability

Sustainability has remained a cornerstone of EPSS’s transformation journey. The organization is committed to ensuring that its improvements are not only effective but also sustainable in the long term. The addition of an Enterprise Resource Planning (ERP) system based on SAP S/4HANA is expected to further reinforce EPSS’s capabilities in sustaining improvements while adapting to future challenges.

Dr. Abdulkadir Gegelo, Director General of EPSS, emphasized that winning the Grand Prize at the Global Health Supply Chain Summit is a testament to the relentless pursuit of excellence by his team. He noted that this recognition reflects their commitment to transforming challenges into opportunities for better service delivery in Ethiopia’s healthcare sector.

Future Prospects

As EPSS looks forward, it remains steadfast in its mission to build on these accomplishments. With robust systems in place, an empowered workforce, and forward-looking strategies, EPSS is well-positioned not only to continue driving impactful change within Ethiopia but also to serve as an inspiration for healthcare systems worldwide.

Ethiopia’s healthcare landscape is evolving rapidly, with increasing demands for high-quality pharmaceuticals driven by population growth and urbanization. The successful transformation of EPSS serves as a model for other organizations aiming to improve their supply chains amidst similar challenges.

In conclusion, the journey of the Ethiopian Pharmaceutical Supply Service exemplifies how strategic focus on continuous improvement can lead to significant advancements in public health infrastructure. By prioritizing efficiency, embracing technology, and fostering a culture of accountability and learning, EPSS is not just enhancing its operations but is also making a profound impact on the health outcomes of millions of Ethiopians. As it continues on this path, EPSS stands as a beacon of innovation in the global health supply chain landscape.