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The recession has created both challenges and opportunities for those overseeing supply chains in healthcare. With budgets tight, health care providers must monitor closely where savings can be achieved and are increasingly looking to supply chain. This paper argues that the roles of distributors should be included in the main decision-making loop...
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Citations
... It is worth noting the commonality of procuring through distributors in healthcare SCs. In the US in 2009, nearly 80% of healthcare products, valued at roughly $320 billion, were purchased through distributors (Kwon and Hong, 2011). The use of distributors makes it harder for organisations to trace the origin of their supplies, which can leave them vulnerable to SC disruptions (Graves et al., 2009;Kwon and Kim, 2018). ...
... It is worth noting the commonality of procuring through distributors in healthcare SCs. In the US in 2009, nearly 80% of healthcare products, valued at roughly $320 billion, were purchased through distributors (Kwon and Hong, 2011). The use of distributors makes it harder for organisations to trace the origin of their supplies, which can leave them vulnerable to SC disruptions (Graves et al., 2009;Kwon and Kim, 2018). ...
Purpose
This paper aims to explore how resilience is evident in healthcare supply chains in the public sector when faced with pandemic disruption and to identify any learnings to inform recovery and future-readiness phases.
Design/methodology/approach
An exploratory case study was conducted, consisting of seven semi-structured interviews with public sector supply chain actors in the healthcare personal protective equipment supply chain. The data included document analysis.
Findings
Key findings show how specific resilience strategies such as agility, collaboration, flexibility and redundancy, contributed to supply chain resilience during the COVID-19 pandemic response. Collaboration is identified as a key mechanism for resilience with public sector networks viewed as facilitating this. Established collaborative relationships with suppliers pre-pandemic did not support increased visibility of tiers within the supply chain.
Originality/value
This is one of the first papers to provide in-depth resilience insights through an example of healthcare supply chains during the COVID-19 pandemic.
... Regardless of the relevance of the theme [15], studies on medicine reverse logistics (MRL) are scarce [2,6,[16][17][18][19], especially concerning hospital pharmacies [18]. In addition, until recently, it was observed that, for various reasons, health-related supply chains were, to some extent, lagging behind commercial supply chain operations [20]. To reduce this gap, the main objective of this study is to find out which MRL practices are used in 13 hospitals in the South of the State of Rio de Janeiro. ...
Initiatives related to reverse logistics are increasingly common in companies that produce tires, lubricating oils, batteries, and electronic equipment, among others. In the pharmaceutical sector, reverse logistics is also relevant, contributing to reduce medication exposure to other people and the environment. Thus, this research seeks to find out which practices related to reverse logistics are used in 13 hospitals in the state of Rio de Janeiro. Regarding the methodological procedures, this research is supported by interviews with those responsible for disposing of medicines from hospitals, and the best practices were ranked using the analytic hierarchy process (AHP) method. Among the main difficulties for performing Medicine Reverse Logistics practices in hospitals, the absence of a standard process for medicine disposal and medications held by nurses or satellite pharmacies—for being out of control—stand out.
... Similar findings were reported elsewhere (e.g. Kwon and Hong, 2011). ...
... There is a room that GPOs can play to improve provider's financial situation. A study by Kwon and Hong (2011) explored the roles of distributors by directly linking them to manufacturers bypassing GPOs. The purpose of the study, they claim, is to: see whether logistics cost can be separated from the "total costs" practiced by GPOs; and search for relationship building process with suppliers. ...
... On the other hand, lack of collaboration and trust may have cost Chrysler $24bn over 12 years period (Henke et al., 2014). Unfortunately health-care supply chain has made very little progress toward adopting commercial supply chain framework (Kwon et al., 2016) since the original study was reported in 2011 (Kwon and Hong, 2011). ...
Purpose – This paper attempts to explore avenue where suppliers and manufacturers are aligned with healthcare providers to improve supply chain visibility. Supply chain finance is explored to link suppliers/manufacturers with healthcare providers.
Design/methodology/approach – Existing literature on supply chain visibility in healthcare forms a basis to achieve the study purpose. Alignment calls also for financial health where supply chain partners’ working capital is readily available to execute joint supply chain plan.
Findings – There is a disjoint in supply chain alliance between suppliers/manufacturers and providers where providers are unable to trace the origin of supplies. Quality care suffers and cost of care rises as providers search for supplies on an emergency basis. This paper provides a framework where solution can be formulated.
Limitations and implications – Suppliers/manufactures form a direct strategic alliance with providers where product visibility enables healthcare providers with a better patient management with lower cost of supplies. Inventory management and logistics cost will be lowered as better planning/forecasting is in place. This paper does not call for testing any hypothesis. Perhaps next move along this line will be to investigate financial health of supply chain partners based on supplier relationship management practices.
Originality/value – This paper proposes health care supply chain as an alternative solution to achieve the twin purposes; controlling the cost while improving quality of care through supply chain finance. As far as we know, this study is first attempt to achieve the goals.
... The strategy seems to be feasible since the central premise of supply chain is to reduce or eliminate unnecessary expenses with efficient supply chain/logistics tools. Kwon et al. (2011) point out the need for scholarly discussions to re-conceptualize SCM in healthcare because the development stage in healthcare supply chain is far behind commercial supply chain in utilizing various supply chain tools. In spite of such a wide gap in supply chain applications between these two industries, there has been no sufficient research done on this topic in the healthcare field. ...
... Dooley (2009) proposes a six-stage step for effective SCM implementation in the hospital and medical system, areas as individualized functional operation, the coordination of each function, enhanced visibility from shared information, functional cooperation and integration, and securing accelerated operation from sustained functional integration. From the same perspective, Kwon and Suh (2004) and Kwon et al. (2011) also maintain that for successful healthcare SCM, it is indispensable to sufficiently share information, risks, and rewards. A recent study on power of information sharing and collaboration in supply chain appears to validate their claims (Partidas, 2015). ...
The healthcare landscape has been rapidly changing in this country with the introduction of the Affordable Healthcare Act in 2014. Pressure on cost cuts and quality improvement put healthcare organizations in a tenuous position. Management has been forced to explore all avenues to achieve twin goals; reducing cost and improving quality. Achieving an optimum and even perhaps minimum profit level adds additional challenge to healthcare organizations. In response to such external pressure, healthcare organizations in this country look for help. Healthcare supply chain enters into the picture as one of the tools that administration can rely on. This paper explores what has been done in the healthcare supply chain area within the last 10 years.
In the field of healthcare, introducing new technology and management strategies is slower than other industries primarily because healthcare organizations have relatively conservative cultures reflective of their unique task; saving human life. Considered as a subcategory of general business management in academics, healthcare is not positioned to lead the new discipline. Hospital management, however, has to meet new challenges under the volatile environment and rapidly changing government healthcare policies. Only ten years ago, hospital management focused on strategies for profit maximization. But as it became clear attracting patients had its limits, hospitals started to strive for cost containment efforts. According to report by Pricewaterhouse's Health Research Institute, $1.2 trillion out of $2.2 trillion total medical expenditure have been wasted (Kailanz, 2009). Supply chain cost in the healthcare field accounts for 38% of the total cost while the corresponding information in retail business is 5% and 2% in the electrical engineering business (Johnson, 2015). Lack of collaboration among players in the healthcare field is also cited a s amajor obstacle in achiving the maximu supply chain surplus (Duffy, 2009). A recent study by UPS (2015) seems to conccur such findings (2015).
Accordingly, healthcare has begun to re-direct their strategies of improving profitability by reducing costs. Under such managerial change, the supply chain management discipline seems to be an attractive alternative achieving an acceptable level of profitability. The strategy seems to be feasible since the central premise of supply chain is to reduce or eliminate unnecessary expenses with efficient supply chain/logistics tools. Kwon et al. (2011) point out the need for scholarly discussions to re-conceptualize SCM in healthcare because the development stage in healthcare supply chain is far behind commercial supply chain in utilizing various supply chain tools. In spite of such a wide gap in supply chain applications between these two industries, there has been no sufficient research done on this topic in the healthcare field.
This study, therefore, aims at new directions for the research on SCM in healthcare based on an extensive and critical review of related literature. This paper is organized as follow; literature review is provided in Section 2 where overview of healthcare supply chain management in tabular format, comparative studies on commercial and healthcare supply chgain managememnt, major operational tools in healthcare supply chain management, and barriers of adopting healthcare supply chain management are presented. Summary and conclusion are presented in Section 3 which is followed by managerial implications.
LITERATURE REVIEW
Deployment of supply chain management strategies in the healthcare field has been painfully slow in spite of calls by many scholars and practitioners to implement this strategy in healthcare. This paper attempts to critically review the status of supply chain operations in the healthcare field in an attempt to address what has been done in academics as well as the practitioner’s field to gain insight where future research efforts should be addressed. Literature published within the past 10 years will be reviewed. Recommendations for academics as well as practitioners will be presented at the end of this paper.
An efficient supply chain management helps to increase the productivity of a business. Use of information technology and concepts like artificial intelligence, blockchain, and cloud computing have integrated the different aspects of supply chain with its stakeholders. Published literature in the field of SCM, IT, and the pharmaceutical industry has been reviewed, and different aspects of innovation, technique, risks, advancements, factors, and models have been taken into consideration to form a comprehensive chapter focusing on the role of information technology in the supply chain management of the pharmaceutical industry. The chapter finds that IT has made a significant impact in improving the efficiency of SCM. But its successful implementation and collaboration with other firms is the key to success for an efficient SCM. Within each category, gaps have been identified.
Supply Chain Management(SCM) is primarily concerned with general strategies for improving the processes of logistics. For
most of the Korean hospitals, however, SCM is almost equivalent to cost reduction strategies, and research on SCM is still its
early stage. This article is a case study based on face-to-face interviews with logistics working in the major five Korean general
hospitals. This research concludes that the hospitals concerned have not sought cost reduction in logistics in order to defuse any
crisis in the overall management. Instead, it seems that their systemic approaches to logistics aim at enforcing a centralized control
of their enlarging systems, promoting the staff's conveniences, and streamlining work procedures.
Supply Chain Management SCM is a very critical part of any business. A well-coordinated SCM can improve the efficiency of the business and help in cost reduction. As information technology (IT) is being used widely across all businesses, SCM can benefit to a large extent by the use of IT. This article reviews a number of papers in this field and suggests research gaps for further exploration. The aim of this article is to review the literature on the role of IT on supply chain management (SCM) with special focus on the pharmaceutical industry and suggest possible gaps from the point of view of researchers and practitioners. The article finds that IT has made a significant impact in improving the efficiency of SCM. But its successful implementation and collaboration with other firms is the key to success for an efficient SCM. Within each category, gaps have been identified.
Collaborative relationship is said to foster sustainable supply chain operations. It is argued that relationship based supply chain produces financially tangible results in many areas of supply chain. The concept is based on transaction cost theory arguing that the final price is determined in the market by total cost. A collaborative relationship fosters trust that leads to lowering transaction cost and speed up time to market which creates “serial equity” rather than “spot equity”. Recent research on collaboration and supply chain performance seems to suggest tangible financial gains. Yet, no theoretical framework has been developed and empirical evidences have been lacking to support such hypothesis. A clearly defined theoretical framework and supportive empirical evidence between these two constructs are needed for future research in this area. This article attempts to articulate the theoretical foundation of collaborative relationship in supply chain and survey empirical results on financial gains reported in various research studies.
