What it takes to have a more resilient supply chain

Could hospitals make sure they are kept safe from supply chain disruptions? How can healthcare supply chains be more resilient?

The healthcare supply chain is unlike in any other industries. It is time-bound and patients’ lives are at stake. Waiting for supplies often means risking the spread of infection or disease complications.

Unfortunate as it may seem, we have only seemed to learn the importance of supply chain resiliency when COVID-19 hit us. Hospitals scrambled for personal protective equipment (PPE) that can protect their staff and patients. They panicked to stock more drugs believed to be effective cures. The general public hoarded overpriced masks, hand sanitizers, and the like.

Dr Vivek Talaulikar, CEO, Gleneagles Global Hospitals Mumbai

Hospital Insights Asia talked with Dr Vivek Talaulikar, CEO at Gleneagles Global Hospitals in Mumbai, about how they tackled the supply chain disruptions during the pandemic, what realisations they had, and how they believe hospitals can build a resilient supply chain.

Panicking over supplies

We grappled in the dark during the early months of the pandemic. We had little knowledge about the virus let alone an idea on how to prevent its spread.

At the time, hospitals scrambled to store just any drug believed to be successful in treating COVID-19, such as Hydroxychloroquine, Tociluzimab and Remdesivir. PPE, when initial specifications had been released, were too expensive. Testing kits were insufficient as procurement was focused on PPE, N95 masks, and essential drugs, Dr Talaulikar recounted.

Demand surely went up and supply dropped due to national lockdowns and export bans. To illustrate, the demand for raw materials used to make PPE saw supplies reduced from two weeks’ worth of PPE in February to but a few days’ worth in March

A demanding supply chain management

The problem of supplies may look simple for others, but shortages in supplies, particularly PPE and medications, have catastrophic consequences, Dr Talaulikar highlighted. Solutions, too, aren’t that simple.

Gleneagles Global Hospitals in Mumbai, for instance, had already resorted to activating each of the senior leadership’s networks. Regulatory authorities had also played their part in controlling and freezing prices for necessary supplies such as masks and sanitisers. Apart from this, PPE and drug usage were constantly monitored and audited.

While the above steps might have mitigated the risks that patients would otherwise suffer, these did not entirely solve the supply chain disruptions that caught the industry off-guard. For Dr Talaulikar, the answer is to “be resilient in the face of change” so hospitals can “remain competitive.” 

Flexibility and transparency

A report from the Institute of Supply Management observed that companies that have been less hurt from the pandemic have a diversified supply chain. Meanwhile, businesses that only relied on one supplier, like China, suffered worse.

“What we have learned from this supply chain disruption is flexibility,” shared Dr Talaulikar. We have to be flexible in the brands we use and not rely on a single vendor or supplier, he added. But in so doing, we still have to be mindful not to compromise quality.

Domestic manufacturing, therefore, can help, although Dr Talaulikar does not see this as an all-encompassing solution, since supply chain management is also about the sourcing of raw materials and logistics support. Nonetheless, sourcing locally with vendors that can ramp up production in a short time can be a long-term solution.

Hospitals can also better manage their supply chains through transparency and communication. Negotiations with vendors, for one, have to be transparent so as to ensure a steady supply. Likewise, internal communication is vital in ensuring more efficient use of available resources.

At Gleneagles Global Hospitals Mumbai, for example, there was a daily discussion among the supply chain head, medical heads, nursing heads, and key clinical consultants to assess existing stocks, anticipate any shortfalls or surges in demand, and plan to source the stocks accordingly.

Taking advantage of technology

We have new technologies today that enable an effective mapping of supplies, therefore, help make supply chains resilient. It doesn’t have to be a complex technology. A simple spreadsheet wherein each drug, product, or device is mapped against a specific supplier can be used. A supplier database will definitely provide flexibility in terms of cost, location, and logistics support which can be helpful in mitigating risks, Dr Talaulikar underscored.

Other industries have ventured into supply chain analytics. At Gleneagles Global Hospitals Mumbai, this is still done in very basic nature, although it serves the purpose of predicting requirements in advance, thereby, helping the supply chain team procure resources on time.

The thing with COVID-19 is it is unprecedented, but this is definitely not an excuse for hospitals to delay strengthening their supply chains in case another pandemic or similar uncertainties happen in the future. After all, it’s best to always be prepared.

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