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Inventory management of perishable health products: A decision framework with non-financial measures

Duong, Linh Nguyen Khanh; Wood, Lincoln C.; Wang, William Yu Chung


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Dr Linh Duong
Senior Lecturer in Operations Management

Lincoln C. Wood

William Yu Chung Wang


Purpose: This research proposes a decision framework for using non-financial measures to define a replenishment policy for perishable health products. These products are perishable and substitutable by nature and create complexities for managing inventory. Instead of a financial measure, numerous measures should be considered and balanced to meet business objectives and enhance inventory management. Design/methodology/approach: This research applies a multi-methodological approach and develops a framework that integrates discrete event simulation (DES), analytic hierarchy process (AHP) and data envelopment analysis (DEA) techniques to define the most favourable replenishment policy using non-financial measures. Findings: The integration framework performs well as illustrated in the numerical example; outcomes from the framework are comparable to those generated using a traditional, financial measures-based, approach. This research demonstrates that it is feasible to adopt non-financial performance measures to define a replenishment policy and evaluate performance. Originality/value: The framework, thus, prioritises non-financial measures and addresses issues of lacking information sharing and employee involvement to enhance hospitals' performance while minimising costs. The non-financial measures improve cross-functional communication while supporting simpler transformations from high-level strategies to daily operational targets.


Duong, L. N. K., Wood, L. C., & Wang, W. Y. C. (2020). Inventory management of perishable health products: A decision framework with non-financial measures. Industrial Management and Data Systems, 120(5), 987-1002.

Journal Article Type Article
Acceptance Date Apr 10, 2020
Online Publication Date Apr 10, 2020
Publication Date May 4, 2020
Deposit Date Jul 23, 2021
Journal Industrial Management and Data Systems
Print ISSN 0263-5577
Publisher Emerald
Peer Reviewed Peer Reviewed
Volume 120
Issue 5
Pages 987-1002
Public URL
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