The Effect of Digital Inventory Management Systems on the Performance of Public Institutions in Tanzania: A Case of Medical Stores Department Headquarters

Abstract

The increasing complexity of inventory management in public institutions, particularly in healthcare, necessitates the adoption of digital inventory management systems (DIMS) to enhance operational efficiency and accountability. Although previous studies have highlighted the benefits of digital stock tracking in government institutions, few have examined their impact on organisational performance within healthcare supply chains in developing countries. This study assessed the effect of Digital Inventory Management Systems on the performance of public institutions in Tanzania, focusing on the Medical Stores Department (MSD) Headquarters. A mixed-methods research design was adopted, involving quantitative surveys and qualitative interviews. The study targeted 178 MSD employees, with a sample size of 123 respondents determined using Yamane’s formula. Findings revealed that 67.8% of respondents agreed that DIMS improved transparency and accountability, 71.5% reported enhanced stock record accuracy, and 40.7% observed reduced monthly stock discrepancies. Overall, DIMS adoption significantly improved institutional performance by enhancing operational efficiency, data accuracy, and speedy decision-making. The study recommends continuous staff training, improved system integration, and stronger ICT infrastructure to sustain these benefits. The findings provide valuable insights for other public institutions in developing countries seeking to strengthen efficiency and transparency through digital inventory management solutions.