Performance analysis of healthcare supply chain management with competency-based operation evaluation

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Highlights

  • The framework was based on the processes of the healthcare SCM and their operations.

  • The operations were evaluated according to their competency.

  • The performance of the healthcare SCM was measured using the fuzzy rule-based approach.

  • The findings helped identify and enhance the weak processes of healthcare systems.

Abstract

The performance analysis of healthcare supply chain management (SCM) has become extremely important as healthcare systems have begun to struggle to enhance operational efficiency and diminish costs. The aim of this study was to measure healthcare SCM in accordance with competency-based operation evaluation. The study was organized as a hierarchical structure based on the main processes, sub-processes, and their operations of healthcare SCM. It is considerably difficult to quantify the competency of an operation. Therefore, a fuzzy model was developed to measure healthcare SCM performance according to competency-based operation evaluation. The fuzzy model consisted of evaluation and measurement levels. The first-level assessed the operations that measured the competency of the operation using a fuzzy heuristic algorithm. The second-level measured the performance of healthcare SCM using a fuzzy rule-based system established based on the performance of the main SCM processes. This model was used to measure the performance of SCM and evaluate the activities of five hospitals operating in Bishkek, Kyrgyzstan. The findings were determined to be helpful for healthcare systems to identify and enhance weak processes and their sub-processes in order to provide competitive advantage against competitors.

Introduction

Operations management in health organizations is a crucial issue as it creates added value in the processes and enhances patients’ quality of life. The effective key decisions made by an operations manager can provide great contributions to the success of a healthcare organization. Up until the 21st century, relatively little technical talent or resources had been devoted to improving the operations or measuring the performance of healthcare systems. The functions of today’s healthcare system aim for improvement by addressing key quality dimensions such as safety, effectiveness, patient-centricity, timeliness, efficiency and equitable distribution (IOM, 2001). Supply chain designs for healthcare service providers are driven by the need to provide support for the essential elements of the various services these providers deliver. Due to efficiency and effectivity control, supply chain management (SCM) plays an important role in achieving the quality dimensions of a healthcare organization.

The objective of SCM should be to fulfill a customer’s request by controlling the flow of information, materials and products/services through any activity in a way that promotes the quality of an organization’s operations (Chopra & Meindl, 2007). SCM can affect the quality of healthcare services measured from a professionally medical perspective, an administrative perspective and from the perspective of the recipient of the patient services. The quality of healthcare services according to an administrative perspective depends on making use of the available resources and providing exceptional services, which involves providing the right service at the right time at a rational cost (Al-Saa'da et al., 2013). The main global challenges in healthcare systems are improving efficiency by reducing waste in processes and identifying the dominant power of any tool, technique, methods and technologies to improve healthcare delivery and services worldwide. Hospitals can certainly improve their clinical practices by better controlling and managing process costs incurred by labor, supplies, equipment and facilities to improve patient care costs, which make up most of the expenses of hospitals (Bendavid & Boeck, 2011).

The processes of healthcare services have intense cost and quality pressures. While many industries have dealt with these pressures with added value created by improving SCM processes, the health industry has remained far behind. Researchers have stated that this is attributable to healthcare’s unique operational context which requires cooperation, yet experience factors that repress coordination. Meanwhile, the general perspectives on value creation are advancing toward a service-dominant decision that concentrates more eagerly on coordinated efforts based on the sharing of specific skills among on-screen characters working in healthcare systems (Chakraborty, Bhattacharya, & Dobrzykowski, 2014).

Healthcare systems have many sub-units that are highly incorporated service processes for taking care of the necessities of the patients under treatment. A typical healthcare system includes the cooperation of many service processes including those of the outpatient department, the emergency department, inpatient wards, operating theatres, the intensive care unit, and diagnostic services. A sub-unit or department consists of one or more related processes within the hospital. An integrated healthcare system framework coping with the distinctive parts of healthcare services and its issues has a few combinations of service and facility types, and patient statuses. It is vital to construct a model for operational performance measurement according to the conditions and constraints of the healthcare system. The general operational performance of a healthcare system can be measured according to the performance of the processes carried out by the departments/sub-units (Bhattacharjee & Ray, 2014).

This study proposed a fuzzy methodology for effectively measuring healthcare SCM performance according to a competency-based operation evaluation. Essentially, the interviews of process managers or process owners regarding the competency of the process operations were taken into consideration with a fuzzy heuristic algorithm and then the healthcare SCM performance was measured using a fuzzy rule-based (FRB) system. The rest of the paper is organized as follows: Section 2 provides a review of the recent literature on healthcare SCM performance measurements, Section 3 presents a generic framework for performance assessment through hospital SCM systems and Section 4 presents the conclusion remarks.

Section snippets

Background

The classic healthcare SCM performance measurement system uses investigational and statistical approaches. Investigational approaches focus on understanding the process specifications, which are comprised of talent requirements, efforts, dependability and work environments, and operations that are effective in the preliminary evaluation. Statistical approaches, on the other hand, use the data belonging to patients and medical products that physical flow throughout SCM processes. The

Methodology for healthcare supply chain performance measurement

Healthcare services are carried out by many interconnected business processes within the supply chain. A process should add value to the services by eliminating waste and unnecessary costs. Processes must also add value for customers throughout the supply chain. The process perspective is very important and provides a basis for understanding the cross-process organization and the services provided by healthcare systems. The supply chain constructs a relationship between processes and

Conclusion

The performance measurement of a hospital’s SCM is of vital importance in today’s competitive environment. Hospitals need to monitor and evaluate their performance to improve the quality of their operations. The attainment of high SCM performance is dependent on the ability to accurately identify operations according to patient expectations and the competency of the processes to meet patient needs.

In this study, a fuzzy model that evaluated the competency of the operations in the processes of

CRediT authorship contribution statement

Adem Göleç: Conceptualization, Methodology, Software, Validation, Formal analysis, Writing - original draft, Writing - review & editing, Visualization, Supervision, Project administration. Gulnara Karadeniz: Conceptualization, Investigation, Resources, Data curation, Writing - original draft.

Acknowledgement

The material for this study was extracted from a Ph.D. dissertation titled ‘‘Measurement of Hospital Supply Chain Performance by Fuzzy Modeling Approach’’ carried out by G. Karadeniz (Department of Business Administration, Social Sciences Institute, Kyrgyzstan-Turkish Manas University).

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