Supply chain encompasses every effort involved in producing and delivering a final product or service, from the supplier’s supplier to the customer’s customer. Whilst supply chain management includes managing supply and demand, sourcing raw materials and parts, manufacturing and assembly warehousing and inventory tracking, order entry and order management, distribution across all channels and delivery to the customer” (“What is Supply Chain?”, n.d.).
As Langabeer and Helton succinctly puts it, supply chain’s mission has often been characterized as providing the right goods, at the right time, to the right location, at the right price, in the right condition. In healthcare, this may involve; goods/services from manufacturers->distributors/retailers->hospitals->patients, then cash from nursing/patients->receiving/warehouse->distributors/retailers->manufacturers. (2016).
The cornerstone of all business processes in supply chain management includes inventory, distribution, facilities and customer services, decisions made in each/all of these affect results
Inventory is the margin of safety, which protects organizations from unpredictable levels of demand. The difference between inventory and supply is timing and chargeability of items and use. For example, items purchased and used immediately or within a calendar period, that is one month, is supply, whatever is left if the purchased items after the period is seen, stored and calculated as inventory. In healthcare, it will include drugs, gauze, surgical procedure kit, needles, orthopedic-bed etcetera. In short it is unutilized supplies that are disaggregated throughout the organization.
Distribution is the flow of goods within the supply chain that is the planning, logistics and delivery of products from warehouse or production facility to wholesalers retailers or end-customers directly. Decisions in this portion of supply chain management include “route and labor scheduling, scanning and replacement, mode selection, equipment and expediting.
Facilities’ space and layout, locations, vendor access, storage configuration etcetera are now integral parts of decision making as these promote the operational flow of supply chain management.
For example if a vendor comes into the patients waiting room to deliver products, this will cause disruption in flow because due to facility layout, the supplies store room is probably closer to the back of the building hence the back-door/service-door would have been a better entry point for the vendor.
Customer Service in supply chain management involves the outbound interface of product and service agreements between producer/seller and user, all interactions between patient and provider at time of sale and thereafter. The type of decisions involved in this are availability of product, overall costing and pricing, cycle time, quality of product/service. So as ensure the production of high quality service to customers.
The future of supply chain management cornerstones will show a phased move from paper based planning to electronic based planning starting with the automation of the key business processes and transactions.
References
Langabeer, J.R. II. & Helton, J. (2016). HealthCare Operations Management: A Systems Perspective. 2. Jones & Bartlett Learning Pp248-254
Price, R. (2017). What Are the Four Elements of Supply Chain Management? Retrieved from https://bizfluent.com/info-8133640-four-elements-supply-chain-management.html
“What is Supply Chain” (n.d.). Council of Supply Chain Management Professionals F.A.Q. . Retrieved from http://cscmp.org/CSCMP/Develop/Starting_Your_Career/Frequently_Asked_Questions.aspx?WebsiteKey=0b3f453d-bd90-4121-83cf-172a90b226a9
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