Group 2 - Final Report - SCM-THYROCARE-PHARMEASY

INDIAN INSTITUTE OF MANAGEMENT KOZHIKODE – KOCHI CAMPUS
Program name – EPGP Kochi Campus

Batch – 10
Course – Supply Chain Management
Faculty –Dr. Ramesh Krishnan
Term – VI
Group – 2
Team members
S.NO Roll No. Name

1 EPGP10KC081 Md Sohail
2 EPGP10KC038 Arup Kumar Jana
3 EPGP10KC124 Salim Nazir
4 EPGP10KC035 Arun Kumar
5 EPGP10KC149 Sudheer Betha
Project on analyzing a real-life supply chain problem of a company and

suggesting a probable solution
 Executive Summary
This report aims to design an optimized supply chain for Thyrocare’s diagnostic operations,
specifically targeting a reduction in centrifuge Turn-Around Time (TAT) to under 5 hours. By
leveraging insights from advanced supply chain management principles, we can streamline sample
collection, transport, and processing phases, achieving faster, more reliable diagnostic results.
 Contents
1. Introduction
2. Analysis of Current Supply Chain and Distribution Network
3. Problem Analysis
4. Objective
5. Methodology
6. Proposed Network Design
7. Implementation and Expected Outcomes
8. Conclusions and Recommendations
1. Introduction
 Company Overview: PharmEasy is a well-known Heath-Tech startup whose inception dates

back to 2015. PharmEasy is India’s leading online healthcare aggregator, offering a range of
services including: prescription pharmaceuticals, diagnostic test services, over-the-counter
pharmaceuticals, and other consumer healthcare products. In 2021 PharmEasy acquired
majority stakes in Thyrocare Technologies Limited, an Indian multinational chain of
diagnostic and preventive care laboratories, headquartered in Navi Mumbai.
 Diagnostics Business: There are two popular business models practiced in Thyrocare.
o B2B: Contributing almost 80% of Thyrocare’s revenue it comprises mainly corporate

periodic health check-up, medical camps and also tie up with hospitals.
o B2C: Contributing around remaining 20% it comprises home collection of blood

samples
o Thyrocare has their own pathological testing facilities as well as partnered with
independent labs.
 Challenge: The primary operational bottleneck is high centrifuge TAT (Turn Around Time)
due to delays in sample transport, waiting times in labs, and inefficient processing flows. This
is with respect to B2C business.
 Scope: We are going to analyse the B2C business model and provide recommendation for
that domain.
2. Analysis of Current Supply Chain and Distribution Network
Fig. 1
 Phlebotomist Network: In the current process customers can book tests via phone or app.
Company’s information processing centre allocates the sample collection slots to the
phlebotomists. Sometimes this happens automatically by some algorithm and sometimes done
manually. Phlebotomists collects the samples next morning as per their allocations and
deliver them to the lab allocated for the region. In some cases, there is another person
collecting the samples from several phlebotomists and deliver them to the lab.
 Transportation Logistics: Most common test is blood sugar which requires two samples,
Fasting and Post-Prandial (PP). Vials comes with bar codes on them which are scanned and
patient information is fed at patient’s home. The samples are stored in a cooled box and
delivered along with the box to the assigned labs. The phlebotomists use their own bikes to
collect and deliver the samples. In some areas another mid-mile transport also operates. He is
responsible for collection of blood samples from multiple phlebotomists.
 Lab Operations: A typical medical centrifuge contains provision for 12 sample vials.
Centrifuge is a machine where the blood sample is rotated at a very high rpm to separate the
serum from blood cells. This usually takes 15 to 20 mins. So clearly centrifugation is the
bottle neck in this whole process.
 Centrifuge Turn Around Time = Total time available for the centrifuge in a day / Number
of sample batches centrifuged
3. Problem Analysis
 Inventory: Accumulation of samples cannot be allowed as the samples need to be process

within few hours.
 Transportation: Higher transportation cost, lack of aggregation.
 Facilities and handling: Number of facilities tends to be high in order to maintain the
samples freshness.
 Centrifuge TAT: Average centrifuge TAT varying between7 & 8 hours
 Key Bottlenecks:
o Collection Delays: Irregular phlebotomist availability and scheduling.
o Loosing samples: Incorrect patient info, damage bar code or lack of responsibility
from phlebotomists’ side.
o Transport Inefficiencies: Delays in delivering samples to labs, particularly with
distance and traffic constraints.
o Lab Processing Delays: Extended waiting times for centrifuges, impacting TAT and
overall testing times.
4. Objective
 Primary Goal: Design a supply chain network to reduce centrifuge TAT to under 5 hours.
 Sub-Objectives: Optimize phlebotomist schedules, transport logistics, and lab operations.
5. Methodology
Using “framework for network design decisions”
 Phase I: Strategy Definition

o Supply Chain Strategy: There has to be a balance between efficiency and
responsiveness for the diagnostic service chain to operate successfully. That means
the sample collection and delivery network should be designed so as to optimize cost
on one hand but again deploying sufficient phlebotomists to be able to collect sample
the next day of booking.
 Phase II: Regional Facility Configuration

o Location and Facility Decisions: Partnering with independent labs has several risks.
Variation in service levels, anomalies in certifications and standards, valid degree of
lab technicians etc. Establishing Thyrocare labs at strategic locations and partnering
with few large reputed labs has to be exercised.
 Phase III: Site Selection

o Logistics Hub Optimization: Establish mini-hubs close to major collection points for
quicker aggregation and dispatch. Reducing last mile transportation cost and
possibility for aggregation of samples.
 Phase IV: Market Allocation

o Assign facilities based on demand patterns and capacity. Using Operations Research’s
resource allocation problem algorithms to allocate phlebotomists and assign labs for
further processing with cost minimization target.
6. Proposed Network Design
To achieve a TAT of under 5 hours, this network redesign strategy combines elements of high-
responsiveness sample collection models and efficient distribution network models:
Fig. 2
1. Engagement of phlebotomists:
o Blood sample drawing is a high skilled job and only certified persons are allowed,
hence proper incentivization is crucial. Instead of salary, consulting mode of
incentivization can be adopted.
o Resource allocation algorithms can help bring parity of income among the
phlebotomists.
2. Collection Process:
o Phlebotomists should ensure proper supply of vials with no damaged bar codes
o Patient’s info can be entered the night before the collection day
o Suitable gears can be designed for sample storage and carrying in order to minimize
loosing samples.
3. Use of Regional Mini-Hubs:

o Strategically position mini-hubs near high-sample collection zones.
o Aggregate samples from phlebotomists at these hubs to minimize wait times and
allow for bulk transport to labs.
o Engage low cost delivery partners for the activity, thereby reducing the travel time
of phlebotomists.
4. Distributor Storage with Last-Mile Delivery:

o Rapidly deliver samples from hubs to labs using dedicated, time-sensitive last-mile
delivery systems. This model is ideal for fast-moving items in dense city areas.
5. Lean Laboratory Processes:

o Implement lean workflows to minimize downtime, maximizing the availability of
centrifuges for sample processing.
o Allocate specific centrifuges during peak hours to ensure they are available
precisely when needed, reducing idle time and optimizing throughput.
6. Leveraging power of data:

o Lean and robust data collection system for optimized functioning of the supply chain.
o Enabling decision for further addition of facility, strategic locations, addition of
centrifuge machines in existing facilities.
By utilizing these network design principles and focusing on streamlined logistics and lab processes,
Thyrocare can achieve significant improvements in centrifuge TAT, ultimately enhancing service
levels and customer satisfaction.
7. Implementation and Expected Outcomes
 Phased Implementation: High-demand regions should be targeted for initial

implementation.
 KPIs for Success: Measurement of centrifuge TAT, sample handling time, and transportation
efficiency, booking to report TAT.
8. Conclusions and Recommendations
 Importance of agile network adjustments as demand patterns change has to be emphasized.

 Future scalability for additional diagnostics services and geographical expansion can be
considered.

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INDIAN INSTITUTE OF MANAGEMENT KOZHIKODE – KOCHI CAMPUS

Program name – EPGP Kochi Campus

S.NO Roll No. Name

2 EPGP10KC038 Arup Kumar Jana

3 EPGP10KC124 Salim Nazir

4 EPGP10KC035 Arun Kumar

5 EPGP10KC149 Sudheer Betha

Project on analyzing a real-life supply chain problem of a company and

 Company Overview: PharmEasy is a well-known Heath-Tech startup whose inception dates

o B2B: Contributing almost 80% of Thyrocare’s revenue it comprises mainly corporate

o B2C: Contributing around remaining 20% it comprises home collection of blood

2. Analysis of Current Supply Chain and Distribution Network

 Inventory: Accumulation of samples cannot be allowed as the samples need to be process

Using “framework for network design decisions”

 Phase I: Strategy Definition

 Phase II: Regional Facility Configuration

 Phase III: Site Selection

 Phase IV: Market Allocation

6. Proposed Network Design

3. Use of Regional Mini-Hubs:

4. Distributor Storage with Last-Mile Delivery:

5. Lean Laboratory Processes:

6. Leveraging power of data:

7. Implementation and Expected Outcomes

 Phased Implementation: High-demand regions should be targeted for initial

8. Conclusions and Recommendations

 Importance of agile network adjustments as demand patterns change has to be emphasized.

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