The Ailing Healthcare Supply Chain: A Prescription for Change

Abstract

SUMMARY Despite well‐documented evidence of significant competitive advantage and cost reduction resulting from supply chain management (SCM) practices, the healthcare industry has been extremely slow to embrace these practices. This article, through literature review and case studies within the healthcare industry supply chain, explores the barriers to implementation of SCM practices. These barriers include: lack of executive support; misaligned or conflicting incentives; need for data collection and performance measurement; limited education on supply chain; and inconsistent relationships with group purchasing organizations and other supply chain partners. Practical recommendations are made for hospitals and supply chain partners struggling to implement workable SCM solutions.