The Effect of Pandemics on Healthcare Supply Chains – The Challenges & Solutions
The pandemic came as a surprise and disrupted the healthcare industry while exposing the structural weaknesses of its supply chain. With the sudden requirement for various medical equipment worldwide, the healthcare supply chain failed to manage the demand.
Over 59% of organizations expressed dissatisfaction and experienced delays with the supply of essential medical products.
Subsequently, healthcare facilities have faced numerous inventory shortages in the last two years due to this minimized supply. It was mainly because of the challenges like delay, hoarding, and inaccuracy in the management. Yet, the world has dealt with the issues and found ways to mitigate these disruptions during such emergencies.
Here’s everything the industry needs to know about the challenges for the healthcare supply chain during pandemics.
The Challenges in Healthcare Supply Chains During Pandemics
The challenges mentioned below hampered the collaborative approach of the healthcare ecosystem. The pandemic’s societal challenges seem small in front of the healthcare supply chain issues.
Here are the inevitable challenges the system faces during pandemics.
1. Inaccuracy and Insensibility in Inventory Data
Reason: The networks were crippled, and there was no clear view of hospital inventory
During the pandemic, the management sector was the most significant issue with medical supplies. The supply chain did not have a clear view of the hospital’s inventory. It gave access to inaccurate data that did not make any sense. Nobody knew the extent of medical devices needed across the world.
The crisis surfaced the hidden brokenness of the healthcare supply chain system.
Without access to accurate inventory data, the healthcare industry failed to make any projections. Besides, the process management during this time was poor, and everyone depended on old legacy software. Due to this inaccurate factual data, the supply chain inventory lost its sensibility.
2. Lack of Resilience and Visibility in Supply Chain
Reason: The sudden rise in demand and no action plan for the supply chain.
The pandemic exposed the vulnerability of the supply chain resilience. It created a lack of visibility while accessing centralized, real-time data. These were sourced from consumable data sources that became dispersed and invaluable during the pandemic.
The industry failed to manage things that they could not measure or see.
The lack of visibility and resilience faltered the industry’s ability to determine patient requirements. Hence, the quality of patient care dipped, and everyone blamed the supply chain for this disruption.
3. Hoarding Due to the Delay in Supply Allocation
Reason: Medical institutions hoarded the medical supplies due to the delay in allocation.
During the pandemic, people hoarded and stocked up on toilet paper. Similarly, medical institutions start to collect healthcare supplies due to the tremendous delay in the inventory. The facilities wanted to remain prepared for uncertain situations and increased their critical storage supplies.
A rapid response system required optimal medical supply access for the industry.
Due to this, the supply chain dynamics changed drastically, and accurate data modeling became an issue in such a short time. Even with automated inventory management software, the problems with the supply chain were there.
Other Challenges: There was a slow innovation due to the hindrance in the repurposing of manufacturing units. Additionally, cost management and technology integration became an issue during the pandemic.
Understanding the Demand and Root Cause of the Challenges
With the virus’s arrival, the healthcare supply chain glitches were exposed. The constant demand of various requirements proved the fragmented complexity of the chain.
Besides, the numerous healthcare products required by the industry during the pandemic were:
- Pharmaceuticals (38% increase in generic drug supply)
- Personal Protective Equipment (12 million emergency stockpile of N95 respirators)
- Medical Devices (160,000 ventilators were required)
- Medical Supplies (Requirement of newer innovations)
How Could the Healthcare Industry Identify the Challenges?
The healthcare industry must first determine the factors to overcome the supply challenges of these essential products. Keeping track of the following factors, challenges, and red flags will help evaluate the shortcomings and create ways to overcome them.
- Slowed down deliveries of various critical supplies
- Unavailability of the workforce to transport the products
- Bans on export and import of essential equipment
- Panic buying or stockpiling of supplies
- No coordination between the organizations and the government
- Lack of healthcare resiliency and enhanced redundancy in cost-focused strategies
- Over-reliance on offshore or selected manufacturers
- No transparency in the centralized supply
What are the Recommended Strategies?
After analyzing these factors, the industry leaders would automatically create strategies to mitigate the interruptions. Using the ones mentioned below will help solidify the supply chain’s resilience during emergencies.
All healthcare organizations should consider implementing the following before another pandemic hits:
- Be open to changing the compensation programs
- Eradicate redundancy in the supply chain inventory
- Utilize all the technological solutions and applications
- Understand the inventory, and create a holistic view
- Monitor the supply network, map it and gain greater upstream visibility
- Achieve diversity in the supply base by enhancing network agility
- Introduce AI-enabled supply chain management systems
Incorporating these strategies in the healthcare ecosystem will enhance the connectivity of the supply chain. Consequently, it will transform into a collaborative approach to help manage future healthcare challenges.
The Bottom Line
Nobody was prepared for the pandemic, especially the healthcare industry. Hence, the backbone of the industry suffered the most. The healthcare supply chain suddenly increased demand for pharmaceuticals, PPEs, medical devices, and supplies.
Without proper disaster control in the strategies, the framework failed to implement its effectiveness. Hence, there were technical issues with cost management.
Besides, the insensibility and inaccuracy led to the loss of resilience in the supply chain. Hoarding of the products and equipment ensured that the supply gets delayed to the other facilities. The industry must over-analyze factors like over-reliance, transparency, unavailability, and bans to find solutions to these challenges.
Doing so would help determine the issues and create a strategic system to overcome the pandemic-induced challenges.