Delivery System Improvement of the High-technology Medical Equipment on the Example of LLC Philips

Nowadays, based on conditions of market-driven economy and due to the huge impact of government regulation, manufacturers of high-technology medical equipment (Ultrasound, Magnetic Resonance Imaging, Computed Tomography, X-Ray and Angiography systems) face the necessity of solution the issue related to total lead-time reduction in order to align with all commitments defined in state contracts between focus companies’ customers and end-users (mainly public hospitals) at the same time with maintaining the balance between high service level and logistical costs. Lead-time duration and the volume of expenses influencing the final equipment value are the crucial criteria for tender results so the stated issue is highly significant. The purpose of this master's thesis is to develop recommendations for improving delivery system as a key stage of the order cycle. The object of this research is LLC Philips, one of the leaders both in international and national markets of healthcare equipment. The subject of the research is company’s delivery system and its main parameters which impact the effectiveness of the delivery process. The procedure defining the sequence of steps for delivery system improvement including transition from indirect shipment via consolidation warehouse to direct shipment from factories (taking into account features of medical devices import to Russia) and reconstruction of warehouse network. As a result of proposed measures implementation, company has managed to reduce lead-time, logistical costs and the volume of shortages (missed-on-arrival boxes). These changes has a positive impact on company’s performance indicators.