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27August 2018

The Basic Concepts and Principles of Healthcare Supply Chain Management

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A sample assignment on the topic Healthcare supply chain management, basic principles and concepts.

What is the Supply Chain Management?

The supply chain is an integrated system that synchronizes a sequence of interrelated processes with the intent to:

(1) Create products demand

(2) Acquire parts and raw materials

(3) Transform the parts and raw materials into finished products;

(4) Use the process to add value in these products;

(5) Promote and distribute these products to end-customers or either retailers and

(6) Ensure smooth information exchange in interrelated organizations like suppliers, distributors, manufacturers, third-party retailers and logistics providers. The main intent of supply chain management is to boost the operational efficiency, competitive position and profitability of an organization like hospital and its supply chain partners like manufacturers of pharmaceutical, healthcare insurers, etc.

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The Supply Chain Management Principal

The approach of total systems is the key foundation for the concept of the supply chain. The total systems approach regards the supply chain as an entity that is comprised of interrelated subsystems with its personal provincial goals, however, it integrates each segment activity to optimize the wider goals of system.

The total approach of system that is regarded as the major conceptual lay stone for principles of supply chain principles let the healthcare organization to monitor how changes in the environment in healthcare environments affects the healthcare organization’s total costs and profits across-the-board.

The Supply Chain Management Concept

In order to avoid confusion in readers about basic concepts of supply chain management, some terminologies have been introduced: Such as

Value, push strategy, pull strategy, postponement strategy, Bullwhip effect, strategic alliance, core competency.

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