Hai, I am Rakesh, final year MBA student at Amrita School of Business. In this blog, we are going to talk about how the supply chain model of the healthcare sector needs to be changed in order to be prepared to tackle pandemics like the Covid-19.
For over a decade the healthcare sector as relied on a just-in-time model of distribution, JIT helped the industry to control costs and reduce waste, but this model failed to meet the demands of a global pandemic. Now the industry is thinking of ways to improve the supply chain to avoid such crisis in the future.
Based on the insights gained from the first half of 2020, here are some ways to stay prepared for the worst situations.
Using data and automation to ensure that at any point in time there are sufficient supplies of PPE and medication. New standards set by supply-chain teams of manufacturers provide access to current and reliable product information at the item level, including cost, consistency, on-hand inventory levels, and standardised replacements. They are developing alternate supplier lists and virtualized object masters in favour of this, which are then merged into their I.T. Uh, programmes. These lists are integrated into a cloud-based system for easy access and procurement of supplies from alternative vendors. From the automation perspective, the sector is prioritizing order to cash processes in an attempt to create the foundational data to power demand-planning models and secure collaboration with disparate groups.
Enforcing effective facility access procedures. Updating policies to meet the covid-19 requirements at the same time making online accessibility easier to avoid confusion when vendors arrive. To be able to rapidly change gears in order to adapt to shifting dynamics posed by health emergencies, the introduction of a combination of health check attestations, temperature screening and mobile capability will provide to be useful.
Essential procurement processes must be streamlined and digitized. Manual procurement procedures, involving paper, e-mail and fax, results in slow supply chain operation, especially during unforeseen peak demand. But some of the applications have not yet caught up to the new developments. During the crisis, the providers who had invested in automation benefited by not having the need to go through the complicated paperwork. It is now time to introduce a robust transaction management approach to streamline communications between vendors and manufacturers in a compatible manner and simplify order placing, approval and payment procedures. Streamlining transaction processing systems, in addition to time savings, allows better insight into the state of orders and products, facilitates remote operating environments, and establishes a data base to guide algorithms for preparation and allocation.
Preparing financially to address a crisis. Cancelled surgical procedures and higher demand for PPE put financial pressure on the sector. As healthcare providers and their suppliers have noted, proper planning relative to supplier-payment processing and working capital is critical to ensuring operational integrity. From the insights gained during the pandemic, the providers are preparing their financial systems. While a resilient supply chain comes at a higher cost, it ensures that all the deadlines are met and there is no holdup in the product delivery. Expanded payment options such as dynamic discounting and variations on credit cards, for more flexible and efficient management of cash and capital. The flexibility of expanded payment options can make a big difference in a time of crisis to both providers and suppliers.
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