Healthcare Supply Chain Management; Influenza Vaccines; Inventory Reservation; Inventory Allocation Mechanisms; Service Differentiated Demand Classes;
This research investigates the impact of alternative allocation mechanisms that can be employed in the context of vaccine inventory rationing. Available vaccine inventory can be allocated to arrivals from high priority (target groups such as healthcare professionals) and low priority (non-target groups) demand classes using Partitioned Allocation (PA), Standard Nesting (SN), and Theft Nesting (TN). In any one of the mechanisms, a part of the available inventory is reserved for the exclusive use of the high priority demand class.They differ, however, in how the unreserved portion of the inventory is utilized: Under PA, demand from the high (low) priority class consumes only the reserved (unreserved) quantity. Under SN, demand from the high priority class first consumes the reserved quantity; once and if this quantity is exhausted, high priority demand competes with low priority demand for the remaining inventory. Under TN the sequence of allocation is reversed: both demand classes first compete for the unreserved inventory. Once this portion of inventory is exhausted, high priority demand is fulfilled from the reserved inventory and low priority demand is rejected.The authors develop service level (probability of fulfilling the entire demand) and fill rate (fraction of demand fulfilled) expressions for all three allocation mechanisms. Based on these expressions, numerical analyses are conducted to illustrate which allocation mechanism a health planner should choose depending on the availability of vaccines, and how the health planner should set the reserved quantity for the high priority class.The authors observe that (1) there exist certain conditions under which one of the allocation mechanisms outperforms the others and (2) this effect is determined by the decision maker’s choice of the performance measure.