Top 5 Strategies to Mitigate Healthcare Supply Chain Problems During an Emergency

Tampa, Florida, USA, 2021-Dec-06 — /EPR Network/ —

Emergencies don’t knock at the door before hitting you like a sudden storm in the desert. Since the dawn of time, nature has had its way around, showing us its capricious tendencies, whether it’s in the form of calamities, diseases, or unusual occurrences we are oblivious of that are on their way to strike us. 

We all saw how the healthcare supply chain industry was hit in the case of COVID. Much human loss can be prevented by preparing ourselves with the right mindset and learning from our past mistakes. The transport of medical supplies and relief personnel has to be done promptly and efficiently to increase the survival rate of the affected population and decrease the expense of such operations.

Here are the Top 5 Strategies to Manage Healthcare Supply Chain Problems During an Emergency Head-on

Building Transparency 

Developing a transparent view of a multitier supply chain begins with determining the critical parts of your operations. Working with operations and production teams to estimate your material expenses and catalogue elements will identify the ones sourced from high-risk areas and do not have prepared alternatives. Based on suppliers’ uniqueness and location, a risk index for each BOM commodity will certainly help recognize those components at greatest threat. 

When the essential elements have been identified, firms can then analyze the threat of interruption from tier-two and onward suppliers. This phase of planning must include asking straight concerns of tier-one organizations about who and where their vendors are and developing information-sharing agreements to identify any type of disruption being encountered in tier-two and also past organizations.  

Suppliers should engage with each one of their vendors, across all rates, to form a series of joint arrangements to monitor lead times and also stock degrees as an early-warning system for disruption and establish a recovery preparation for vital distributors by the asset.  

In situations in which tier-one distributors do not have exposure right into their own supply chains or are not forthcoming with information, companies can develop a theory on this danger by triangulating from a range of info sources, including center exposure by market and also components classification, shipment influences, and export levels across countries and also areas Business-data suppliers have data sources that can be bought and also made use of to perform this triangulation.   

Advanced analytics techniques and network mapping can be made use of to choose valuable information from these data sources quickly and highlight one of the most critical lower-tier vendors. 

Integrating these theories with the understanding of where parts are typically sourced will produce a supplier-risk assessment, shaping discussions with tier-one distributors. This can be supplemented with the defined outside-in evaluation, using numerous information resources to recognize feasible tier-two and onward providers in impacted regions.

Analyzing Customer Demands 

An emergency or anything close to a crisis can alter (increase or decrease) demand for particular products, making it harder and also more vital to estimate final-customer needs. Services ought to doubt whether demand signals they are getting from their prompt customers, both short and moderate term, are reasonable and also mirror underlying uncertainties in the forecast.   

The demand-planning group, using its market experience and offered logical tools, must have the ability to find a dependable need signal to figure out the necessary supply– the outcome of which must be reviewed and set in the incorporated sales- and operations planning process. 

Additionally, direct-to-consumer communication channels, market understandings, as well as internal and also external databases can provide valuable info in evaluating the existing state of need among your clients’ consumers.   

When information sources are limited, open interaction with direct customers can fill out at least some spaces. Keeping these considerations in mind, forecasting demand needs a strict procedure to effectively operate unclear and ever-evolving circumstances. To get ready for such circumstances efficiently, companies ought to take the following actions:  

• Build a demand-forecast system that comprises analyzing the set of data and time horizon for the projection to make decisions that are risk-informed in the S&OP plan. 
• Use advanced statistical projecting devices to produce a sensible forecast for base demand. 
• Incorporate market knowledge right into product-specific demand-forecasting models. 
• Assure active monitoring of forecasts to counter errors immediately or as quickly as possible. 

With numerous end clients engaging in scarcity purchasing to guarantee that they can claim a higher portion of whatever is in short supply, companies should question whether the demand signals they are getting from their immediate customers, both short and also moderate term, are realistic as well as show underlying unpredictabilities in the projection.  

Making orders smaller sized, more regular and including adaptability to contract terms can enhance end results both for providers and their customers by smoothing the optimal and valleys that elevate cost and also waste. A triaging procedure that prioritizes clients by strategic significance, margin, and profits will likewise aid in guarding the connection of industrial partnerships.  

Optimizing Production and Distribution Ability 

Equipped with a demand prediction, the S&OP process should then optimize production and distribution capacity. You can use scenario analysis to examine the multiple capacity and production scenarios to arrive at an understanding of their financial and operational connections. 

Optimizing production starts with securing employee safety. This involves interacting and sourcing with crisis-communication teams to communicate about infection-risk matters and possibilities for remote and home work. 

The next step will involve scenario planning to calculate an extended shutdown’s financial and operational implications and evaluate impact based on available capacity. To plan on how to use available power, the S&OP process should discover which products propose the highest strategic value, acknowledging the significance to health and human safety and the earnings potential, at present as well as during the future recovery.   

The review will draw on a cross-functional team that incorporates marketing and sales, strategy staff and operations, and also people who can tailor updated macroeconomic forecasts to the expected result on the business. A digital, end-to-end S&OP platform can quite adequately meet production and supply-chain plan with the predicted demand in various situations. 

Building Redundancy   

One way you can enhance supply chain resiliency is by adding redundancy in the supply chain. This includes carrying an additional inventory of necessary health care items, accommodating excess manufacturing capacity for manufacturing critical items, or engaging with backup suppliers.  

However, redundancy can be counterintuitive for many supply chain professionals. It comes at a price, and supply chain professionals have earlier focused on efficiency. Sourcing managers hardly get rewarded for managing risk. Instead, they are usually rewarded based on cost-focused metrics.  

Unless the reward system is transformed, it would be unrealistic to assume sourcing leaders to concentrate on areas that would make supply chains more flexible.  

This does not imply sourcing leaders should totally drop their focus on cost management. Alternatively, sourcing leaders should be aligned with cost savings and supplier risk management. Balancing costs will help assure that companies execute supply chain resiliency measures that are going to be cost-effective.  

For instance, strategic positioning of safety stocks in a supply chain rather than holding them throughout the supply chain can render much-needed resiliency, without inciting expensive costs. 

Diversified Sourcing  

The COVID-19 pandemic has revealed the necessity to have a diversified approach to sourcing. For companies without the scale to maintain and support several locations by themselves, good relationships with contract manufacturers and global 3PLs are indispensable in diversifying production and distribution to different countries. Additionally, collaboration with strategic raw material suppliers and other service partners is also crucial to ensure better preparation and flexibility for the future.  

According to some surveys, data indicates that around half of supply chain organizations use external manufacturers or analyze how they can support product moves, with a similar proportion including logistics partners for this purpose. 

Bottom Line  

The COVID crisis has been a significant factor in bringing forth the lingering weaknesses and cracks in the health care supply chain, forcing us to rethink new ways of managing our systems. However, it also paved the way to innovation and unique learning opportunities. In the times of crisis like these, implementing efficient team-based coordination, employing advanced technological systems, improving public-private partnerships, and health system collaboration are some of the best ways to move forward.