Advancing the health care supply chain and promoting leadership through strategic partnerships with industry

Integration vs. Collaborative Redesign Strategies of Health Systems' Supply Chains in the Post-COVID-19 New Normal: Cross-Sectional Survey Across the United States

Background

Given the widespread disruptions to supply chains in 2020 because of the COVID-19 pandemic, questions such as how health systems are shaping strategies to restore the supply chain disruptions are essential to have confidence in health systems’ supply chain model strategies. Plausibly, health systems have an opportunity for redesign, growth, and innovation by utilizing collaborative strategies now, compared to the usual strategies of integrating their existing supply chains to reduce inefficiencies.

Objective

This study focuses on teasing out the nuance of supply chain integration versus collaborative redesign strategies for health systems in the post-COVID-19 new normal. We focus on 2 research questions. First, we explore the impact of perceived supply chain challenges and disruptions on health systems’ supply chain integration (SC-INTEGRATION) and collaborative redesign (SC-REDESIGN) strategies. Second, we examine the outcomes of integration and collaborative redesign strategic choices on growth and service outcomes.

Methods

We used data for this study collected through a consultant from a robust group of health system chief executive officers (CEOs) across the United States from February to March 2021. Among the 625 health system CEOs contacted, 135 (21.6%) responded to our survey. We considered supply chain–relevant strategy and outcome variables from the literature and ratified them via expert consensus. We collected secondary data from the Agency for Healthcare Research and Quality (AHRQ) Compendium of the US Health Systems, leading to a matched data set from the 124 health systems. Next, we used ordered logit model estimation to examine CEO preferences for partnership strategies to address current supply disruptions and the outcomes of strategy choices.

Results

Health systems with higher disruptions would choose integration (positive, P<.001) over redesign, indicating that they still trust the existing partners. Integration strategy is perceived to result in better service outcomes (P<.01), while collaborations are perceived to lead to greater growth opportunities (P<.05); however, the role of integration in growth is not entirely ruled out (combined model, P<.001). Plausibly, some health systems would choose integration and collaborative redesign models, which have a significant relationship with both services (combined model, P<.01) and growth, establishing the importance of mixed strategies for health systems.

Conclusions

The cost of health care continues to rise, and supply-related costs constitute a large portion of a hospital’s expenditure. Understanding supply chain strategic choices are essential for a health system’s success. Although collaboration is an option, focusing on and improving existing integration dynamics is helpful to foster both growth and services for health systems.

The effect of trust with suppliers on hospital supply chain performance

Purpose

The purpose of this paper is to investigate the effect of trust with suppliers on hospital-supplier integration (SI) and hospital supply chain (SC) performance. Additionally, the mediating effect of SI on trust-hospital SC performance is investigated.

Design/methodology/approach

A research model and hypotheses were developed based on literature review. The study is based on survey data collected from 152 respondents in 55 private hospitals in Jordan. The proposed hypotheses were tested using structural equation modeling.

Findings

The paper finds that trust with suppliers has a positive impact on hospital-SI and hospital SC performance. Hospital-SI partially mediates the relationship between trust and hospital SC performance.

Practical implications

The findings of this research provide useful insights into the role of trust in boosting SC performance in the healthcare sector. High levels of SI not only improve hospital SC performance but also enhance the transformation of trust benefits into SC performance.

Originality/value

This research is one of the limited studies that investigated the effect of trust on hospital-SI and hospital SC performance in the healthcare sector. To the best of the authors’ knowledge, this is the first study to investigate those relationships in the Middle East in general and in Jordan in particular.