Fundamentals of Vaccine Demand Orientation

From a supply chain perspective, the goal of vaccination is to minimize demand for critical health care. We need to avoid hospitals being overwhelmed. Emergency room/ICU resources and staff are the crucial bottlenecks (hourglass structures) that are at highest risk of collapse. Our supply chain resilience objective is to maintain a reasonable equilibrium of demand and supply for critical health care.  If this equilibrium can be maintained, deaths and disease can be minimized and economic continuity (recovery) can be maximized.

Vaccines provide a long-term, population-wide solution to demand management (demand for critical health care services) that will be less susceptible to the variability experienced with non-pharmaceutical interventions (e.g. facial coverings, distancing, hygiene) and will support a return to large-scale human (and economic) mobility/circulation.

Flows of vaccine need to be calibrated with demand. Demand is not just a matter of population, it is a matter of consumer interest, readiness, and accessibility. 

As long as demand for vaccine exceeds supply of vaccine:

  • There is a need to manage unfulfilled demand to maximize eventual demand.  There is also a need to grow demand (reduce vaccine hesitancy).  Good customer service is especially important as long as we need customers to return in a timely way for second doses (and convince up to 40 percent of the population that the vaccination is something they should want).
  • There are potential benefits serving high-value targets of demand. In a pandemic context, value is mostly a factor of reducing disease/death and reducing the risk of disease/death undermining economic, educational, and other high value activities. So, for example, targeting vulnerable populations (e.g. residents of LTC facilities or those over age 65) should decrease demand for critical health care.  Targeting health care providers should protect/preserve our supply of critical health care.  Similarly, vaccination of food processors, truckers, first responders, etc., is intended to keep other critical services flowing.
  • It is possible to focus on high value targets of demand while flexibly, effectively accelerating consumption of currently available supplies.  There are “Fast Fashion” and many other traditional supply chain (and merchandising) techniques that are explicitly used to accelerate velocity in supply constrained contexts. Local flexibility is essential to system-wide speed. Principled empowerment is more helpful than micro-managed controls.

Accessibility is crucial to effectively fulfilling demand with reasonable-to-better customer service. This requires a diverse set of demand fulfillment venues: hospitals, clinics, pharmacies, home-delivery… In other words, we need the vaccination equivalents of warehouse stores, big box stores, full service stores, convenience stores, dollar stores, and home delivery.  Managing proportional flows in response to variable demand will be increasingly important as supply volumes increase and more demand can be served.

A diverse, wide-spread network to serve demand will be even more important as vaccine supplies are sufficient to fulfill demand.  Deploying this full network as early as possible in the customer-service (demand-fulfillment) process (when volumes are lower) will allow the network to develop capacity to better serve high volume demand in the next 100-to-200 days.

The prior is much more the VC pitch than the elevator speech.  Here’s my elevator speech:

While vaccine production capacity is being scaled up, minimize demand for critical health care by focusing vaccinations on targets with highest demand for critical health care.  Minimize social and economic risk by focusing vaccinations on highest value targets.  While well-serving these initial targets, flexibly serve — and motivate — increased demand for future vaccinations and develop the functional capacity to effectively serve high volume demand.  Accelerate consumption of all available doses.

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