Lean and Smart Supply Chain Management in Healthcare

Introduction

The supply chain is a process that provides the flow of products/services, money and information from the supplier to the final consumer in order to meet the needs of the customers and make profit. Meeting customer needs doesn’t only mean that products are available in the right place, time and quantity, but it is also important to respond to the changing needs and demands of customers and add value to the customer. The production of products/services that add value to the customer is an element that ensures the success of the supply chain.

In the health sector, the supply chain is the sum of the business processes from the producer of the materials to be used in the provision of health services to the service buyers (patients). Recently, increasing demand and the existence of decreasing resources cause health institutions to follow innovative policies in competition. The lean understanding that emerged in the automotive sector and aims to eliminate waste types such as waiting, movement, unnecessary processing, overproduction, insufficient use of personnel, transportation, stock, and faulty products has spread over time and has found application in almost every sector. One of these sectors is the health sector. Lean practices based on the idea of reducing, minimizing, or preventing the activities that don’t add value to the individuals who want to purchase health services at every stage of the services offered in health institutions, are also becoming an important application area in supply chain activities. The implementation of lean (lean tools) in supply chain applications in the health sector will reduce the waste and maintenance cost in service delivery and improve processes. In particular, the most important way to reduce costs is to reorganize and improve processes in the supply chain.

Industry 4.0 technology is also utilized in the application of the lean manufacturing philosophy in supply chain activities. In short, with industry 4.0, which is called the production of smart products and services with smart technologies in smart enterprises, flexible production systems can be provided and the production error rate is reduced. With industry 4.0 applications such as big data, data mining, cloud computing, internet of things, digital twin; it will be possible to contribute to the improvement of supply chain processes in fast communication, monitoring of products, fast delivery, reducing complexity and increasing flexibility areas. Today, there are billions of smart devices such as computers, tablets and smartphones, and their number is increasing. This will have a transformative impact on all industries, from manufacturing to service. By providing detailed monitoring and optimization of activities, the way supply chains are managed will also change completely. (Schwab, 2017).

Not only diagnosis and treatment services determine the quality of the service provided in health institutions. The products, resources, and procurement process of products and services used in service delivery are also important. The services offered in these institutions focus directly on human life. Any disruption in the supply of materials and the provision of services will cause irreparable situations such as disability, deterioration in quality of life and even death. Therefore, the healthcare supply chain function is important. We saw the most recent example in the Covid-19 pandemic that emerged in late 2019. The difficulties experienced in the supply of materials showed that a well-functioning supply chain is so important. Supply chain refers to the process of the right product from the right source, in the right quantity, from the supplier to the consumer (Bowersox et al., 2002). Today, it has been replaced by smart and lean supply chain applications integrated with smart technologies, which respond quickly to fluctuations in demand, eliminate waste and non-value-added elements at every stage of the process.

Managing the supply chain is a difficult and complex situation for any industry. However, it is more difficult to manage the supply chain in the health sector, where services that affect the health and safety of individuals are provided. It is necessary for these services to protect, develop and treat public health, to provide value-adding activities by examining the work flow processes in the supply chain, in order to survive in the conditions of global competition. In this study, the applications and effects of lean understanding and Industry 4.0 technologies which play a major role in increasing quality and efficiency in the health sector will be explained in terms of its supply chain.