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Supply Chain Management in Healthcare: How to Build Resilience

The healthcare sector is facing a pressing need for efficient supply chain management as healthcare organizations strive to boost their profitability and address growing supply chain costs. The drive by some organizations to make their supply chain operations more flexible and robust has increased demand for supply chain management solutions. Moreover, strategic partnerships and mergers among leading players and hospitals have resulted in greater adoption of such solutions.

This article explores how healthcare organisations can become more resilient and future-ready by automating and optimizing their supply chain management. 


Supply Chain Management in Healthcare

Healthcare supply chain management (SCM) is the process of organizing, carrying out, and keeping track of the movement of medicines, medical equipment, and supplies from vendors to patients. It involves an intricate web of distributors, producers, healthcare professionals, and patients. SCM in the healthcare industry aims to guarantee that the proper items are accessible in the appropriate quantities, at the right times, and at reasonable prices.

The primary goals of healthcare supply chain management are to improve visibility and efficiency throughout the supply chain. In recent months, these goals have also expanded to include the strategic objective of enhancing supply chain agility and resilience, which is essential in these times of rising uncertainty and volatility in supply and demand conditions. By properly managing the health supply chain, supply partners will be better able to identify and address bottlenecks, possible interruptions, and other problems that may arise along the end-to-end supply chain. It can reduce waste and wasteful spending while enhancing patient care and safety.

Building a Resilient Healthcare Supply Chain Management System

The healthcare industry’s supply chain aims to locate vulnerable departments and provide solutions to address them, leading to improved health outcomes and financial support for global health.

The advantages of a resilient supply chain in healthcare are improved operations, effective resource utilization, happy staff, effective treatments, and happy patients. Supply management in healthcare facilitates the proper integration of hospital departments, processes, and financial management. It functions as a critical supporting system for combining various activities.

Supply chain management in hospitals ensures that necessary products and medications are readily available, minimizes inventory waste, enhances patient care, and coordinates departmental efforts to reduce errors. This can be achieved through integrating digital systems, streamlining processes, and implementing technology to advance supply chain digitization.

Using technology to support healthcare supply chain resilience

Healthcare organizations are increasing their technology investments every year. According to a Gartner survey, 63% of healthcare organizations reported that they intended to raise their investment in technology in 2023, with 61% stating that their new technology investments were a direct result of the COVID-19 pandemic. A 2022 study by Deloitte and the Scottsdale Institute, a non-profit healthcare membership organization, revealed that leaders in digital transformation prioritize using digital technology to enhance patient satisfaction and involvement, enhance the quality of care, and secure better patient outcomes.

The development of the healthcare supply chain management system’s resilience can be considerably enhanced by technology. For instance, automation and data analytics can help decrease manual errors, increase visibility and traceability, and improve decision-making. Real-time data can be provided by adopting a cloud-based supply chain management system, enabling rapid and effective decision-making. The usage of blockchain technology can also promote transparency, decrease fraud, and boost supply chain efficiency. Here are some technologies that can increase resilience in the healthcare supply chain industry.

Enterprise Resource Planning (ERP) systems combine all aspects of supply chain management onto a single platform, increasing data precision and minimizing human error.

Cloud-based supply chain management systems offer real-time data, facilitate rapid decision-making, and increase the supply chain’s overall resilience.

Blockchain technology boosts resilience by increasing transparency, lowering fraud, and enhancing the effectiveness of supply chain operations.

Artificial Intelligence and Machine Learning can analyze vast volumes of data, find patterns, and anticipate outcomes, enabling better supply chain management and decision-making.

Internet of Things (IoT) devices can be used to follow the flow of commodities, keep an eye on inventory levels, and identify possible problems, all of which help to maintain the supply chain’s resilience.

healthcare supply chain management solutions

The Main Challenges of Implementing Technology in Healthcare Supply Chain Management

Healthcare institutions must overcome various challenges when integrating technology into supply chain management. Among the principal concerns are:

Integrating several systems

Integration is one of the main obstacles to using technology in healthcare supply chain management. For instance, many healthcare businesses employ various distribution, purchasing, and inventory control technologies. These systems integration might be complex, costing money. Integration may also be challenging due to compatibility difficulties between several platforms.

The lack of standardization

The absence of standardization in data formats and protocols in the healthcare sector can significantly impact the effectiveness and reliability of supply chain management operations. It becomes challenging for enterprises to exchange information, integrate systems, and share data across many departments and stakeholders when separate systems employ distinct data formats and protocols. Due to data discrepancies, inefficiencies, and inaccuracies, supply chain activities may become less accurate and reliable overall.

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Data security and privacy

Data security and confidentiality are vital since sensitive data, such as patient health records, must be safeguarded against unauthorized access, theft, and abuse. As new systems, networks, and devices are brought into the environment, using technology in supply chain management may give rise to fresh security and privacy concerns.

As sensitive data is sent and kept in numerous locations, using cloud-based systems, mobile devices, and the internet of things (IoT) might raise the risk of data breaches. In addition, as hackers and cybercriminals look to exploit holes in new systems, adopting new technology may lead to the emergence of unknown attack vectors.


Interoperability is the capacity of several systems to share and utilize data with one another. Interoperability across various systems can be extremely difficult in healthcare since different systems may employ multiple data formats, protocols, and technologies. Data sharing, system integration, and information exchange across many departments and stakeholders may become challenging.

Solving Challenges and Making the Most out of Technology in Healthcare SCM

Healthcare enterprises may overcome the difficulties of integrating new technology with current systems and produce a resilient and effective supply chain management system by adhering to these best practices and using the appropriate knowledge and technology. The organization may thoroughly analyze existing logistics processes to spot bottlenecks and inefficiencies and then utilize the results of this analysis to plan the rollout of a new logistics management system.

Organizations must adopt standard data formats and protocols, invest in solutions that support data interoperability, and adopt standard data formats and protocols to solve interoperability difficulties in the healthcare sector. They could enable information flow between various systems using data exchange standards and application programming interfaces (APIs).

Health organizations must collaborate to develop standard data formats and protocols to address the issues caused by the healthcare sector’s lack of standardization. This may entail working with other institutions, business groups, and technology providers to encourage the adoption of standards and make investments in products that facilitate data integration and interoperability.

Regarding data security and privacy, healthcare organizations must take a proactive and all-encompassing approach to solve these challenges to reduce the constant threats they usually face. The Health Insurance Portability and Accountability Act (HIPAA), which establishes standards for protecting patient information, is one regulation and standard that healthcare organizations must adhere to. To safeguard the security and privacy of sensitive information and to prevent new risks from emerging due to the use of technology in supply chain management, enterprises must ensure that their use of new technologies complies with these laws and standards.

Global Content Portal for Healthcare SCM

Check out how helped one of the leading healthcare business and data automation companies enable better patient care and maximize industry savings through cloud-based supply chain technology and analytics solutions.


A resilient healthcare supply chain management system is vital for assuring the accessibility of necessary medical tools, supplies, and medications, particularly in emergencies. The healthcare supply chain management system can become more resilient with the proper use of technology. However, integrating systems and standardizing data can be complex when deploying technology in healthcare supply chain management.

Healthcare institutions may overcome these obstacles and create a robust supply chain management system that matches their unique demands and improves operations by adhering to best practices and utilizing the appropriate technology and employing the right expertise.

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