June 30, 2023 By IBM Supply Chain 3 min read

In the healthcare supply chain, there are three main challenges pharmacies, hospitals, pharmaceutical companies and patients are facing: shortages and delays; lack of convenient and cost-effective fulfillment options; and rising counterfeiting and regulatory changes, along with a persistent need for better drug cold chain management. These struggles are inconvenient, adversely impact the quality-of-care patients receive and increase staff stress levels. How can healthcare supply chain professionals triage these concerns? By building resilient supply chains.

Facts about healthcare supply chains

According to an industry survey, 78% of respondents still use manual supply chain processes. Various studies show that nurses in medical/surgical inpatient units typically spend up to 2 hours of their shift performing supply-related tasks. In 2022, the pharma industry saw the most units recalled than in the past six years, with 567.3 million, a 114% increase over the 264.6 million units recalled in 2021.

While ensuring that staff feel well-equipped to work efficiently is essential, especially considering the ongoing and pervasive labor shortages in the healthcare industry, medical supply expenses are forecasted to outpace labor costs. As for the implications of drugs that might contain contaminated ingredients or have been kept at inconsistent temperatures, the outcomes could be dire.

These healthcare industry supply chain issues are equally urgent, and each require immediate attention. The good news is, it’s possible to alleviate these perilous pain points by building healthcare supply chain resilience.

3 steps to building healthcare supply chain resiliency

Step 1: Improve visibility and proactivity

Hospital systems work with multiple fragmented teams, technologies and processes to manage daily operations, leading to a pervasive lack of data visibility. Supply expenses escalate due to over-ordering, waste and emergency orders. Healthcare procedures can be delayed because of a lack of supplies. Healthcare professionals need to have greater visibility into what inventory they have available, where it is located (or in transit), and leverage artificial intelligence (AI) to not only predict supply chain disruptions but suggest how to minimize issues.

​Step 2: Consolidate and collaborate to optimize fulfillment options

Healthcare professionals struggle to consolidate omnichannel orders under a single vision of truth for supply, demand and inventory between internal pharma departments and their suppliers​. Combining data from siloed departments or different facilities is one of the first, and most essential, steps in creating a well-informed supply chain strategy. Doing so streamlines purchasing power and optimizes inventory management.

Once hospital systems have real-time inventory visibility, order orchestration and supplier collaboration, they can enable greater customer satisfaction with options like online purchase with store pickup. ​

Step 3: Increase traceability

Along the supply chain, actionable real-time data is often unavailable, lacking or siloed.  From the need to identify contamination of high-value temperature-sensitive products (e.g., biologics) with step-by-step visibility of cold chain sensor data from production to delivery, to the high-quality products made with the correct ingredients, ​supply chain visibility, speed and coordination are critical to the delivery of safe and effective products. By building a strong blockchain-based network with robust visibility, traceability and provenance, healthcare industry professionals will be poised to tackle these regulatory and fraud challenges in a complex global supply chain. ​

IBM Supply Chain solutions can help

Our Healthcare and Life Sciences expertise, end-to-end approach from strategy to implementation, and dedicated sustainability practice, ensures your supply chain can adapt to today’s challenges and prepare for future opportunities. This expertise supports you in minimizing risks, reducing costs and driving continuous improvement in both environmental and social performance. Our suite of solutions includes:

  • IBM Supply Chain Intelligence Suite provides the proactive insights you need to see your inventory wherever it is, predict disruptions by identifying and understanding the effects of demand and external events, and take actions based on recommendations to mitigate the impacts. This helps you respond faster to changes and deliver better patient care while helping to reduce costs.​
  • SCIS: Blockchain Transparent Supply​ offers end-to-end traceability and condition monitoring, verifiable identity management, advanced inventory management and consent-based patient adherence tracking.​
  • IBM Sterling OMS, which earned multiple market leadership awards as recognized by G2, is a cutting-edge solution that provides real-time​ inventory visibility, order orchestration and supplier collaboration while infused with artificial intelligence making it the ideal choice for any business looking for a reliable, scalable, and flexible OMS solution. ​

IBM Consulting is a global leader in supply chain consulting for Healthcare and Life Sciences, with a global ecosystem of partnerships, proprietary access to IBM’s own technology, research and Expert Labs.

IBM Consulting helps the world’s leading Healthcare and Life Sciences companies like Merk design and build intelligent, resilient and sustainable supply chains that provide transparency and insights to accelerate product innovation, maintain trust and provide patient centricity.

Learn how IBM Supply Chain can help you
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