2021 Health System Supply Chain Insights Published
Some of the key learnings from the pandemic included
- Existing preparedness plans nationally and at a health system level were insufficient to manage the scale of the pandemic requirements
- Existing suppliers could not scale to meet requirements and rapid identification and qualification of new sources was required
- Single sourced distribution relationships came in for criticism, as did an over reliance on China based sources. An increased appetite for direct manufacturer relationships was identified, but this was tied to performance metrics and a documented approach to emergency supplies.
- Demand management and product allocation processes were not robust enough to manage at scale the allocation of critical products
- Internal and domestic third-party logistics processes came under severe pressure, but worked in general. However, investments were identified as being required to eliminate certain manual processes.
- Lead time and uplift of product from China was particularly challenging and remains so today with current shipping capacity challenges
- It was acknowledged that mistakes were made, particularly around the rapid qualification of some new supply sources. However, supply chain teams performed well to support the health systems through the worst of the crisis.
- There is a need to rethink approach to inventory and risk management for future emergency situations. A more coordinated approach both nationally and between health systems will be required.
- Processes around rotation and management of critical inventories need to be strengthened
Overall, the experience of the last 18 months has increased awareness of the importance of the supply chain function in the healthcare setting. 100% of respondents said that they were in a better position to respond to the needs of the pandemic because of a strong internal supply chain team.
Several executives acknowledged a greater willingness now to further invest in technology, process development, and the upskilling of key supply chain resources.
We would like to acknowledge and thank the executives from the health systems that participated in this year’s research. If others are interested in learning more about the current research, or participating in future studies, feel free to contact us and we would be delighted to discuss.