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LSM106 Logistics Managemment: Sheikh Khalifa Medical City

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Questions:

1:

Understand the relationship between supply chain management (SCM) and organizational business objectives. 
  • 1.1: explain the importance of effectivesupply chain management in achieving organisational objectives
  • 1.2: explain the link between supply chain managementand business functions in an organisation.
  • 1.3: discuss the key drivers for achieving an integrated supply chainstrategy in an organization

2:

Be able to use information technology to optimise supplier relationships in an organization 

  • 2.1: Evaluatethe effectiveness of strategies used by an organisation to maintain supplier relationships
  • 2.2: Useinformation technology to create strategies to develop an organisation’s relationship with its suppliers tactics.
  • 2.3: Develop systems to maintain an organisation’s relationship withits suppliers. 

3:

Understand the role of information technology in supply chain management  

  • 3.1: Assesshow information technology could assist integration of different parts of the supply chain of an organisation
  • 3.2: Evaluatehow information technology has contributed to the management of the supply chain of an organisation
  • 3.3: Assessthe effectiveness of information technology in managing the supply chain of an organization

4: Understand the role of logistics and procurement in supply chain management 

  • 4.1: Explainthe role of logistics in supply chain management in an organisation
  • 4.2: Evaluateprocurement practices in an organisation
  • 4.3: Discuss thefactors that must be considered when improving logistics and procurement practices in an organization

5:

Be able to plan a strategy to improve an organisation’s supply chain 

  • 5.1: Plan a strategyto improve an organisation’s supply chain
  • 5.2: Assesshow a supply chain improvement strategy will benefit overall business performance in an organization
  • 5.3: Explainhow barriers will be overcome in an organisation when implementing a supply chain improvement strategy

Assignment Task :

Read the following Scenario, and prepare a report

Scenario: 

The learner selects an organization, understands and undertakes a full review of how it manages its supply chain and logistics. They will need to produce a report that includes how the management of the supply chain impacts on business performance, the role of IT in managing the supply chain, the role of procurement and logistics management.  The final part of the report will be a plan for a strategy to improve the organisation’s supply chain and logistics management.

Answers:

Introduction on chosen organization:

The selected organization for the study is the main hospital operating in entire United Arab Emirates. Currently, I have been working with Sheikh Khalifa medical city, which was founded on 28th February, 2000. Cleveland Clinic Foundation manages the hospital and is one of the part of SEHA management healthcare system. Some of the departments in hospital comprise of Behavioral Science pavilion, surgical pavilion, Rehabilitation center. For various emergency cases, there is a trauma center considered by SKMC. One of the strength of SKMC lies in its employees diversity and the organization is served by almost 30000 employees from fifty countries. Hospital has been operating with 45 emergency beds, 120 ICU beds, 586 beds and has 14 out patients clinics (Abdelhak et al. 2014). The mission of hospital is to provide highest quality patient care in a compassionate manner in education and research setting. Vision of SKMC is to be identified as a renowned medical center that would help in quality of life of people it is serving by providing extraordinary services to patients.

All the activities of the hospital is focused on serving patients first.  Hospital intends to provide best possible service to every patients it is serving and go beyond providing services that exceeds their expectations. SKMC operates on some fundamental values forming its culture basis and they are integrity, compassion, collaboration, quality and safety of patients.

1.1 Importance of supply chain effectiveness:

Concept of supply chain needs to be understood first for understanding its importance and impact of objectives of organization. Supply chain is regarded as the movement and oversight of goods and services, material from the suppliers to manufacturing units and then to wholesalers and retailers and eventually to customers. It calls for coordination between logistics, production and development and flow of information among the parties who are involved in transport, delivery and shipping. Values of products and services are maximized and costs are reduced with the help of effective supply chain management. This would help in achieving sustainable competitive advantage. There is two areas covered under supply chain management. In one part, there is a flow of goods and services, materials to customers from retailers. In the second part, there is coordination of strategic plan between various supply chain partners through linking of flow of information’s (Beske and Seuring 2014).

Managing the supply chain can be discussed in various stages:

Plan- Plan is regarded as strategic stage, which comprise of identification of demands of customers, resources management, maintaining efficiency, monitoring supply chain and providing value to customers by delivering higher quality products and cost reduction.

Suppliers- in this inventory control is set by transferring of flow of materials and coordination of payment and delivery process. Suppliers also include maintain competitive price, delivering raw materials in an effective way, maintenance of long-term relationships.

Production and manufacturing- Production of any product needs to have some essential requirements. In this stage, supply chain has crucial role to play as it arrange activities necessary for producing products, conforming delivery readiness along with testing and packaging. Supply chain also confirms to efficient and effective utilization of goods for productivity maintenance.

Delivery- Delivery is regarded as logistic stage. In this stage, some of the points that need to be looked at is warehouse availability, orders receipt, establishment of invoice system and shipping products to customers.

Return- This is the last stage in supply chain management and is regarded as unfavorable. There needs to be flexible process for receiving excessive or defective products. It also comprise of providing support to customers having problems with products delivery.  

Bharadwaj (2014) has defined the supply chain management as total cost reduction and value added maximization by focusing on market certainty response through the entire process of trading. Supply chain management has become very essential due to high competition and globalization. It is specifically crucial for manufacturing companies, as they are required to deliver competitive products of higher quality at lower costs. Importance of supply chain management can be listed down below:

  • Value advantage- value advantage is another area of focus under supply chain management. It intends to add value to products and services. Focusing on productivity enhancement advantage and cost reduction of products is not the only art of supply chain management. It also focuses on adding value to the products by way of cost reduction, achieving productivity advantage by introducing products with lower price, improving the service provided and offering different product achieving productivity advantage over the competitors. All these are achieved by implementation of innovative ways for increasing value and reducing costs.

Supply chain of healthcare has continued to lead the industry of health service by education, advocacy, information, technology, and ethics for bridging the gap between suppliers and healthcare for providing the products of highest quality at of highest value. Goal of organizations are achieved by work of healthcare administrators leading group of people. Administrators also helps in supervising the functions, coordinating and generating the plans of the healthcare organizations. There are two types of healthcare administrators and that consist of generalists. One such specialist would manage the entire facility and other specialist who is responsible efficient and effective management of organization by establishment of proper procedures and policies, budgeting allocation and control, preventive medicine developments of programs and clinical research, marketing and human resources, health aware welfare and enhancements of community, medical vocational rehabilitations.

One of the leading healthcare organization particularly in Abu Dhabi and generally in United Arab Emirates is Sheikh Khalifa Medical city. The organization strives to be recognized as prominent and renowned medical center by providing their patients with compassionate, highest quality of care in research and education settings. Some of other objectives of SKMC is improve the quality of life of its patients by providing superior outcomes and extra ordinary experience. Several business functions of SKMC can be explained by listing down of the following activities.

  • Utilizing the state of art by implementation of latest software of information technology. Organization intends to meet competition and global standards and provides continued developing services by way of hardware equipment.

  • Offering the variety of development programs by providing advanced clinical services to customers. SKMC follows the pull effects by providing surgical and emergency operations, behavioral science and arts, rehabilitation, critical and intensive care for pediatrics and adults.
  • Providing customers with excellent service by keeping itself align with the value of organization that is “keeping the customers first”. The top priority of SMKC is to keep customers at top and providing quality services in all aspects. It focuses on translations concept by way of all concepts and programs for supporting core value.
  • SKMC intends to maintain global medical accreditations by way of enhancing services, generating service of highest quality standard and infrastructure maintenance. Such accreditations include CAP, JCIA and SCPS.
  • Other activities include providing patients with medicine on time by delivering the mots convent treatments and medicines. Implementation of pull method, providing proper medicines as per needs of patients, delivering of supply materials to patients, inpatient pharmacy, ER pharmacy, distribution channel available in outpatient’s clinics and pharmacy service of highest standard.
  • It also assist in medical and clinical aspects of students residing in UAE by providing research and development facilities. Servicing of health sector of country is done by creation of the resources by the organization. Management of such critical business of healthcare is also done by creation of future leaders by way of admin national force staffs enrolment and training and development of clinical graduators.

1.2: Business functions and link with supply chain management:

In the above discussion, main factors leading the system and processes of supply chain management of business has been mentioned. Above discussed business, functions of SKMC would be linked to supply chain management by introducing the supply chain management importance to the healthcare facilities and to organizations in general. Supply chain plays a very crucial role in the healthcare organizations such as industrial organizations, business providers and health care. It plays a leading role in delivery of complex and large systems, customers and agents are involved in supply chain of health care, hospitals and clinics, employees, doctors, insurance companies, regulatory agencies, partners and owner of business.  

One thing that is essential in organizations of healthcare is matching between supply and demands. In the event of demand becoming higher than supply, tasks becomes complex and complicated. Demand for any service comes with supply of both financing and technology. This can be explained say, proper insurance coverage is required for proper treatment. However, insurance coverage may not be able to cover all the treatments and it is quite possible that the individuals cannot afford the cost of treatment.

Market demands are met by supply chain management as it helps in delivering better and convenient services on time by providing proper treatment to patients. SKMC intends to work in coordination with insurance companies by coverage enhancements, which is most convenient to its customers and the cost of treating individual would be reduced as it adopts several controlling measures. It is also essential to mention all the activities that will work toward serving the customers in better way without making any sacrifice on quality of services and products provided by hospital.

1.3: achieving an integrated key supply chain strategy and its key drivers:

Supply chain management of SKMC comes with having key drivers that helps in identification of responsiveness and competitiveness of organization relating to its clinical and medical services and experience of patients. Some of the other areas include information technology, infrastructure. Various forces contribute to making the supply chain management of SKMC effective. All this include competitions, demands of patients, globalization, regulatory, environmental and governmental factors and enhanced management system of healthcare (Waters and Rinsler 2014). SKMC strives to play a significant role in establishing strategic objectives of organization and in this regard. Scope of SKMC has developed remarkably. Some of the key drivers of supply chain management of SKMC are as follows:

  • Technology utilization- State of art

Technology is one of the driver of supply chain management and SKMC intends to employs latest technology across the world. This would help in enhancement of processes development, system integrations. Leading factor in healthcare organization is development in utilization of technology. Skillful technical teams operate new technical machines employed in SKMC. Physicians of SKMC are currently in need of upgrading their technological knowledge so that they continue to operate advanced machines such as Ultrasound, MRI units, ECO systems, ECG, surgical operations devices and instruments, rehab and cardiac machines.

Future progress and supply chain of health care sector is influenced and affected by technology. Hospital is in high need of advanced technical team for operating technological advanced machines. It is required by hospitals for research about the needs of keeping the maintenance of flow of business without any interruptions, rooting and sourcing the supply and latest invented technology and utilizing such technology. Employment latest technology in clinical operations would require clinical staffs to be upgraded with the latest technology of the world and thereby motivating the customer and building the reputation of hospitals in the market (Bharadwaj et al. 2013).

  • Enhancement of quality and globalization:

Some of the world slandered accreditation has been strived by SKMC to obtain by way of performing several activities. These accreditations are Cycle IV Chest pain center accreditation that is accredited by SCPS (Society of Cardiovascular Patient Care), JCIA (Joint Commission International award), and LAP accreditation from the CAP (College of American pathologists). Missions of organizations are supported by such accreditations by creating an environment of trust, delivering highest quality of service, boosting reputation of brand in the market. Quality of service provided and developing strategic plan for exceeding expectations of customers. Development of standard of quality service and global enhancement helps SKMC in following the challenges and achievement of these standards is done by activating supply chain.

  • Changing expectations, lifestyle and customer clinical awareness

Supply chain of SKMC is directly affected by the above listed factors that is lifestyle, customer clinical awareness. Lifestyle of customers and patients are changing dramatically and there are various factors that has affected the lives of people in Abu Dhabi. People are in air conditioned for twenty-four seven and long office hours has resulted in less energy and all this has contributed to  health of people. Abu Dhabi experiences a high demand of chronic treatment as majority of people are affected with disease of diabetes (Heizer and Barry 2013). This has led to increased demand for establishing centers for recovery of diabetic patients.

With the increasing clinical awareness among customers, they are becoming aware of the modern diseases and complications associated with it. There is an increasing high demand of preventive medication and vaccination and this include high demand that is created during time of Haj. Now a day, self-initiative are taken by people for booking an appointment in any clinic, request to do mammogram check by women to check the healthiness of their breasts, blood test requests and checking the health issues by way of proactive checking.

Expectation of customers in the past few decades was to get assisted themselves by way of proper medication and discharging as early as possible. Now a day, patients are sure about the medication they would receive and their expectation in the current environment is far above the previous. Patients that after surgical operations, they are admitted to single or VIP rooms expect it. National patients expected to receive the hospitality services that the residents’ patients are receiving. Some of the services include laundry, food ordering, hotel bookings, catering and transportation. Some of the other areas of concern by national residents are valet parking to their visitors, Wi-Fi connectivity, gifts and flower shops and availability of hair cutting. There have been a creation of pushing of variety of recourse and new supply change demand due to dramatic change in lifestyles of customers, their increased awareness about clinical knowledge and expectations change. For supporting the operations of hospitals and meeting requirements of business, there is a need of additional suppliers (Hao et al. 2014). At the healthcare sector, focusing on single pure treatment is no longer enough.  

  • Achieving customer satisfaction of higher level

Providing patients with highest quality of response for meeting their requirements is one of the focus of SKMC and this has been derived from values of serving customers first. Providing convenient service to patients makes a huge difference and this is done by providing proper service at proper time with the help of proper tool. Therefore, in order to meet the satisfaction of the customers, management of SKMC has made the implementation of recent changes and they are as follows:

  • At each main area of hospital, there would be establishment hot service counters, which is known as Absher desk. This desk is set to speed up the service and here any national patients can approach the agents of Absher for speeding up the service.
  • Appointment and scheduling with the medical professionals would be improved and there would be ease of accessing. Registration department of organization has their key performance indicators set up for accepting the national patients and there is a insurance coverage known as Thiqa, which needs to be seen within three working days. This include enhancing change in internal communications, booking more patient and effectively utilizing time of doctors. Admission of patients’ has also changes by bringing changes in the internal process. All this process are to be done faster and this has helped in achieving goals of organization.
  • Another factor, which has to go in line with strategic vision of organization and this, is done by meeting with Massoul initiative. Requirements of public would be met by introducing one day in one month by management and working on achieving recommendations.

The above listed changes and actions has influenced changes relating to supply of patient, access to pharmacy, delivery of medicines, easy access, processing of rapes with admissions and registration, transportation, delivery of medicines. This lead to improvement of flow in supply chain and enhancement in performance of employees.

  • Political, Regulatory, liberation and governmental

Residents of Abu Dhabi receives compassionate patient center care and this has been one of the objective of SKMC. Priority of the organization has been changed recently and they strives to give priority treatment and full support to UAE nationals and mainly to nationals of Abu Dhabi. Such changes introduced by government has directly affected the supply chain because needs and requirements of nationals are different from those of residents. There is difference in segmentation expectations. Nonetheless, concerns of expats are on providing types of medication with convenience plans of insurance and they intends to make nationals fully insured with all types of treatments and procedures. Focus of organization has shifted to provide nationals with welcoming packages, high demand in services of hospitality due to change in their expectations.

2.1: Maintaining supplier relationship of organization by evaluating the effectiveness of strategies

Relationship with suppliers play a vital role and makes a big difference to the success of operations of organization. Effective supplier relationships contributes in achievement of objectives of organization. Organization partners with suppliers over the long period for developing business relationships that is beneficial. This helps in developing effective supply chain and reducing risks.  Development of partner relationships with suppliers with organization helps in maintaining work commitment for long time, developing business goals and objectives, sharing information, market share and strategic plans. Partnership with suppliers helps both the organization and suppliers for reaching in a win situation by reaching in middle solutions benefits for both. The relationship does not involve control of one over other but they work together for meeting the needs of each other. Leaders create an environment of collaboration with suppliers and improving effectiveness of communications. Such environment would assist in managing the challenges with success and promptly addressing to arising issues. For the mutual benefits of both parties, these successful leaders contributes to enhancement of long-term commitment. In order to share benefits and develop trust between suppliers and organization, there is a need of open communication that would enhance clear understanding of the expectations of both the parties and sharing of the reward and risks of relationships.

It is very crucial to share and develop mutual benefits and healthy relationships between parties. If both the parties does not share benefits due to partnership, continuing the relationship between both parties would not be viable. Therefore, it is required in international arena to focus on building new types of partnership for which a constant development and care is essential. This would help in maintaining long-term and sustainable relationships as case in foreign governments.

Strategic alliance on the other hand is regarded as relationships between organizations that is voluntary. Such relationship intends to achieve certain goals and is formed by maintaining long-term relationship leading to each other’s mission accomplishment. Mission of partnership comprised of the relationship between suppliers, manufacturers and distributors, working together for the achievement of agreed goals by working together and making joint decisions. In addition to working together for achievement of desired goals and sharing the risks, information and resources are also shared in such relationships.

For the success of organizations, suppliers of SKMC plays a vital role. The nature of suppliers supplied by different suppliers to the organization also varies and they are distributed between the global and local suppliers. Relationship with the suppliers and the organization is proactive and the process is led by communicating the procedures and policies very clearly. Communications with suppliers are required to be followed with defining clear procedures and policies. Quotations and bids are required to be submitted between partners an online platform has been adopted by SKMC for participating and sharing bids. For handling this, an online tool has been published by suppliers known as Oracle system. This online tool requires suppliers to be registered and accepted with the system of SHEA and it would help the suppliers in submitting for any bid and applying for any competitions.

There is a sample list of SKMC suppliers listed below along with relation types. It also includes control, which is positioned with SKMC.

After the list of SKMC suppliers are shared, it would be worthwhile to mention the policy adopted by the organization when recruiting companies for various support services. SKMC has adopted the process of opening tender policy for support services such as medical and laundry waste discharge, security. Committee of professional procurement performs evaluation of financial and technical tendering of contract. On the other hand, there is a special contracting process for sole and unique source of suppliers. This process is followed after the confirmation of single source of suppliers for supplying services and materials.

In order to be the part of list of SKMC suppliers, technical and financial aspects are very critical for any suppliers to win the completion. Moreover, there are additional factors that SKMC look for making decisions about suppliers and other factors include product quality or service, delivery time and many other. Being the trauma center for Abu Dhabi, and SKMC playing a crucial role. For an urgent base, there might be requirement of certain medical equipment’s, materials and other sort of services. Another important factor that SKMC look for in deciding the suppliers are ability to deliver the item at required and convenient time and supplier’s sustainability position. Considering the above-mentioned factors help the organization in meeting their needs and requirement (Beske et al. 2014).

2.2: Creating strategies using information technology in relationship of organization with suppliers:

Department of information technology manages the operation of hospital and this department plays an important role in this regard. Information technology department consist of several divisions and they include fifty-five dedicated professional employees. The main umbrella of information technology department is distributed into four departments. Web and application support, Health information management services, Customer services and technical support comprise of the four departments.  These departments manage daily responsibilities and tasks of hospital. There is a catalogue services desk operating within the intranet of SKMC and daily responsibilities and tasks are managed by departments by requesting through the desk and responding to the tickets logged in. IT professionals are assigned with the tickets according to specialty after the team of service desks receive them. Organization has maintained the same value in providing service to external stakeholders as it is in the case of IT customers. This is also in relation with the suppliers. SKMC when publishing any request of tender uses the online platform for notifying to its suppliers. Technical and financial quotes are submitted by interested supplier’s online platform. For all the suppliers, there is the RFQ being generated. The progress of tendering process is monitored by organization using an automated access, which enables the suppliers to log on through the website of SKMC.

After the completion of evaluation process, status of respective quotations are being notified to the suppliers. Notification to the suppliers and confirmation of the winners is done by a system of SMS. Confirmation of realizing the order to the suppliers are notified to the selected suppliers via online as well as notification though email. In order to this, the process of payment is incorporated in the  contract condition and delivery.

It is worthwhile to note that development of healthcare sector is led by the information technology. Due to information technology development, interaction of hospital with the staffs and customers, stakeholders, suppliers, patients for managing day-to-day activities is more connected. Regardless of stakeholders being outside the country or at home, they would be informed about the critical meeting with the help of an email notification. Any critical discussions with the CEO, surgery operations and examination of patients, discussion about any meeting can be done with the help of video conferencing. World has changed due to major development and demand in health care applications such as E-health. This include application such as electronic medical records, telemedicine and health information system. Organization has made the dramatic utilization of advanced websites, smart phones and e learning site locations. All this technological platforms are supporting the users, physician and technical team to remain connected on 24/7 basis. Enhancement of communication and knowledge and barriers has been removed with the help of technology. Some of the example include faster response, improvement in the quality of life and enhancement of better delivery of healthcare.

For clarifying the importance of information technology in the organizations such as SKMC, two snapshots have been added. Management of health information medical record system at SKMC is the critical use of information technology. IT system also assist in understanding the secure and confidential patient medical record system and local culture. An advanced system managed and developed and they have implemented different medical system with multiple integrations. Some of the example include no longer carrying of hard copy by doctors, for authorized staffs have been generated with access to softcopies made with the help of such films. The advanced system has unified all the medical reports so that the patient records can be accessed by SEHA facility without going back to treatment place historical data and medication of patients are available under one location. For instance, for the treatment of patient in Abu Dhabi is possible in Al Ain by accessing the record of sake patient through any hospitals in Ai-Ain. Oracle ERP system helps in managing and accessing the data of patients.

2.3: System development for maintaining relationship of organization with suppliers: 

People of Abu-Dhabi is provided with the support of care with the help of critical and crucial functionality of operating system of SKMC. By introducing the product of best quality, the organization strives to make an improvement in the quality of service provided. SKMC suppliers in delivering the instruments, medical equipment’s, products and other items in proper time, play an important role. In the selection of proper vendor, an important factor to be considered is the cost price. Nonetheless, cost is not regarded as the important factor to be considered. SKMC intends and look forward to manage its suppliers by making an enforcement of delivering the products and service of highest quality at proper and suitable time. Hence, the relationship between the suppliers and SKMC tends to be long-term and strategic. It focus on building trust and respect of two sides. Challenging the global market is done by enhancing the communication, medical product knowledge and awareness and providing the customers with bets quality products at the best price (Groves et al. 2013). For the effective and efficient management of resources, management of hospital intends to maintain good relationship with suppliers for cost reduction. Therefore, investing the time for maintaining strategic relationship with the suppliers and enhancing the communications and interaction and keeping them connected. For enhancing the list of suppliers maintained by organization, hospital goes extra miles in development of wider communications. For each of the products supplied, the focus of organization is on the development of the wider communication. In order to get the quality products at the best price, there is the need for hospital is to develop the critical supplier and there is a need to energize the competition between suppliers (). The opportunity of the hospital is to have best delivery condition when there are different suppliers for the same instruments and products. For improving the long-term relationship with the suppliers, it is essential to have special funding.

After throwing some light on relationship of suppliers with SKMC, it is felt that suppliers of SKMC are expecting to make the following development for maintaining strategic relationship in the end.

  • Enhancing awareness and knowledge- For understanding the exact requirement of the medical tools or equipment, suppliers of SKMC are always seeking appointment with the doctors. It is believed that the ordering process would be easier and skills of suppliers would be boosted by sharing and educating suppliers with such information. This would lead to improvement in relationships.
  • Keeping suppliers connected with organization- Strategic changes taken by SKMC are need to be acquainted by suppliers. This would affect the business of organization in many ways. For instance, communication method of fax was digitized by adopting to the eFax technology and this has led to the interruption of in the workflow process of business. Work flow of business was also interrupted by the digitization of tendering process. Due to the adoption of online communication, competition was lost by many vendors (Schalteggern and Burritt 2014).
  • Communicating with professionals- Suppliers would have the privilege of becoming acquainted with the clinical and specialty services provided by clinical consultants if they remain connected with the ERP system. Suppliers are able to save the efforts and time of they are well acquainted with such knowledge. This would help them in initiating discussion and agreements with the business partners.
  • Having access to SKMC ERP system- For the process of ordering, it is expected by suppliers to have digitize notification. Once a specific product has reached its strategic source, they are required to be notified electronically for utilizing replacement of items and re ordering. This include managing properly the delivery of shipment by an automation process and there should be an allowing of proper periodical notification (Youn et al.2013).
  • Strategic objectives and transparency in business- In healthcare service, SKMC is regarded as center of excellence and it is considered by the suppliers that striking deal with the suppliers is a matter of privilege. However, due to market competition, it is not possible to continue such deal for long-time. In order to continue working with the organization, suppliers might lower the cost price to get the deal. Therefore, there are different approached adopted by suppliers for staying connected with the organization and maintaining long-term relationship with the hospital (Brandenburg et al.2014).

The success of the business of organization, there is a need for suppliers to maintain good relationship with the organization. For relationship enhancement with the suppliers, organization is utilizing the technology and developing strategic and advanced relationship with the suppliers. The transfer of information through online system, there is a strong communication network. This feature enables the wide range of suppliers to have a feeling of trust and partnership. Moreover, hospital has plan in process for increasing loyalty and enhancing commitment with the suppliers and this would be done by enabling stakeholders to have access to ERP and planning a process of automatic notification.

3.1: Integrating supply chain of organization using the information technology:

It would be apt to explain the role played by information technology at SKMC in general prior to explain its role in integration of different areas of supply chain management. Chief of information technology leads the department who directly reports to the CEO of organization. There is internal internet system and all the employees are connected through the intranet of SKMC. The intranet platform helps in interacting and sharing information, bullying of database system by individuals. Staffs of information technology generate various types of access required by employees upon entry to SKMC. Oracle ERP system generates details of information of employees such as superiors, employees full name, managers (Rushton et al. 2014). On the other hand, local extension, email address, fax no., location, mobile phone no of employees are managed by internal Active directory.

Between active directory and ERP, there is a implementation of system integration by the organization. Hence, an ERP would reflect any changes made to the details of employees. Incorporation of the SMS communication tool with the active directory is another integration that has taken place at SKMC. Employees are provided with the facility sending short message system through Microsoft outlook to other employees using mobile phones (Manganello et al. 2014).

Integration with protocol telephony system of Cisco internet is another integration that has happened at SKMC. Employees are able to initiate by clicking on any number available at desktop from their Microsoft Office with the help of Cisco system telecommunication. This facility can be explained with the help of an example, an employee operating at the words document can right click by selecting on the number and then they can talk over the phone by picking up the handset. Privilege and access given to each employees according to the seniority and needs of the business is managed by ERP system. After, having understood multiple integration and structure of IT system, there is a need to understand the management of supply chain and support involvement in managing such change. Now, explaining the example of any tendering process and considerations of the steps are as follows:

  • Submitting the request with the help of Oracle system intranet by end users.
  • Online request is received by manager and online evaluation of buying the item online is evaluated by checking the availability of funds and approving the budget.
  • Manager approves request after the proper justification of business. This is also done after the fund is available and managers convince the need of item.
  • For the necessary submission of order, upon the online approval by managers, the request is send to logistics.
  • Deliver of item is checked if it is available in stock along with stats of logistics inventory.
  • The request is submitted by logistics through oracle.
  • Order goes to procurement once the logistics officer approves it.
  • Procurement agent raises RFQ online request.
  • Upon receiving request of RFQ by suppliers using online platform, response is submitted by making best quotation to SKMC procurement
  • Best quotation is finalized by procurement evaluation committee and submitting the purchase order.
  • Item ordered is received by logistics and order is closed by notifying procurements.
  • Releasing of the payment is notified by Oracle system to the Accounts payable departments after the closing of the order through procurement.
  • Suppliers are notified by Accounts payable team online via sending e-mail with all the details of payment related to procurement.
  • After the payment is made ready to release, notification via the SMS is required to be sent.
  • The suppliers collect money directly from the account.
  • Payment collection information is notified by banks to SKMC procurement.

It is also considered essential to note and mention the continued development in IT that helps in effective and efficient enhancement of the management of the supply chain after having explained multiple integrations happening at the organization. Large database of information is more of a control by individual as it assist them in taking right decision after data analysis. Utilization of information technology has contributed in effectively using the professional timing by handling all the required information via the online access (Dinev et al. 2013). After this, there are different ways to sort it out and ‘reaching the right conclusions.

Last but not the least, it can be said that multiple integration has led to the information technology in improving efficacy of supply chain management by merging all the data and resources. Such integration has helped the logistics in becoming acquainted with the procurement time that required in delivering the products, store needs, dispatching the products by sing effective modes of transportation, timing of delivering the products and many others. Therefore, all the components of the supply chain management are becoming acquainted with the flow of order as well as products by using a unified platform for the purpose of communication. All the suppliers are provided with the right platform sing the information technology. It is relevant for the success of organization to keep the parties acquainted with the progress by sharing information.

Procurement process is then streamlined by information technology and for the purpose of market research; there is a heavy utilization of online activity. Utilizing the information also helps in enabling process of payment, purchasing and suppliers information.

3.2: Contribution of IT toward Supply chain management:

Management of the process of hospital has been dramatically participated by the information technology employed at SKMC. Performance of hospital department are managed by setting convenience key performance indicator at by the mangers according to the automated systems availability. During the past few decades, activities and function of hospital and there is also an improvement not in the health information system. Standalone ones are no longer working for all the medical equipment’s. There are different system connecting all these and they are integrated with compatibility that is high and remotely managed. For running the effective reports, administrators are enables with the advanced technology. After this, the analysis is done of the results delivered and feedback is received on spot. Such platform is being effectively managed by mangers and this provide them with the capability of running quick and online reports.

There is a unified Oracle system, which the organization is operating through. Variety of details and data are managed through an ERP system. This helps in making the flow of information easier and flow in all the departments. Information technology at the SKMC also manages the supply chain and it is becoming more and more acquainted for facing the competitions and challenges of the market. Oracle system helps in the operation of logistics and procurement that helps in connecting the employees on a common platform. Therefore, one of the determinant of the competitive advantage of the organization is the use of information technology. Resources of hospital has been effectively utilized with the help of using information technology (Fawcett et al. 2014). This has been done by lowering stocks, lowering level of inventory and placing the orders effectively that is on time.

There is a need for SKMC to remain on competitive at the global level along with staring in cutting edge as it strives to provides it customers with the highest quality of products and services. Therefore, there is an increased demand of technological incorporation in the supply chain management. Managers of the supply chain have realized with the latest quality care, hospitality after having considered changes in the requirement and expectations of customers. In addition to this, some of the other areas realized are loyal and accountable patients, clinical service and this would help in enhancing control, improving business and increasing the profitability and thereby helping the hospitals its goals and long-term objectives (Button et al. 2014).

Supply chain of the organization is effectively tracked, as SKMC has been capable of performing it due to current utilization of information technology. Tracking of the supply chain has been done at not only the service and ordering flow but also regarding the security and safety. There has been safety and controlled mechanism that have been enables effectively by the system. This involves fridge alarm, heat and smoke dedicators, utilization of CCTV cameras, monitoring temperatures, fire alarm system, accessing the doors. This helps in minimizing the errors and mistakes that has been fixed on spot and thereby avoiding the dramatic loss of the resources of hospital (Christopher 2016).

It would be important to mention that making the effective utilization of the oracle system, shipments tracking, advanced system of financing and online tracking would help the management in effectively utilizing the time. This would help in managing the areas that is considered as the core component of the supply chain management. Utilization of the latest smartphones have helped the mangers in utilizing operations of supervising supply chain. There is multiple app applications that is technology enabled and this assist the users in adding portability that is tremendous to the supply chain. For instance, there is video conferencing and access to camera.

There is a wireless connection enabling the internal communication that is advanced through the information technology. Multiple devices and Wi-Fi are enables in the supply chain, which has a wireless connection for the items such as cameras, phones, barcode scanners, devices, user conveniences. Therefore, managers of supply chain can monitor and manage the process at any stage irrespective of their physical location. The operation process have been pushed by utilization of cloud computing and software programs by tracking, remotely monitoring, managing the materials and products with real time and reporting of online results.

Information technology has led the organization in generally increasing and it is more involved in supply chain management. System such as cloud computing help in syncing of all the systems and they are linked to each other. With the increased in demand of business operational control and functionality, smart phones are becoming more in use. For managing the supply chain, managers are becoming increasingly dependent on utilizing the technology. Software and multiple links enable the managers in understanding the delivery progress and logistics status and various stage of shipment by just one touch clicking. Procurement manager easily manages status of order and the fund needed for managing the request is needed at the end of each year (Lee et al. 2013). Therefore, the supply chain management and the operation of business is completely dependent on the information technology.

3.3: Information technology effectiveness in supply chain:

The process of supply chain is led by major role played by supply chain management. There has been a huge dependency on smart devices and software for managing the operations. Managers have been assisted by the information technology as it has enabled them to access real time reports and data. This has enables them to take effective decisions and has increased their efficiency. Role of information in healthcare has been driving the development and progress in this field. As a part of healthcare, supply chain is getting affected. The more new technology concerning tools, software and program is being utilized, the more it is easier to get the accurate results and thereby faster report and conclusions and the more resources are effectively being managed (Chae et al. 2014).

After discussing the contribution made by information technology to information technology made above, it is critical for success of organization of the current positioning using advanced tool and technology. This also show how much the organization is effective in supply chain management. After the discussion, there have been made some recommendations for making an improvement in status.

There are two major achievements that I would like to share as per the utilization of information technology in the supply chain management.

  • Managing the on time ordering and stock level
  • Tracking the expiry date of on shelf products

Tracking the availability of variety of items in stocks have been a major challenge faced by SKMC. This is due to the number and variety of items that the hospitals are consuming. Employees sporting stores and logistics are spending several hours in a day for searching of the specific items, products and tools availability. Employees have been able to save a lot of time and efforts due to storage automation and this has made possible the effective utilization of resources.

Tracking the stored items expiry date was another achievement made by the organization. Due to incapability of checking the expiry dates, SKMC has faced major challenge and has experienced major loss. This is so because without awareness, the items in stock reached the expiry date. Therefore, the major loss has resulted from inability to take proactive and corrective actions. Management of the items have been done in an effective way due to automation process and replacement of items have been done by enhancing specific deals with the suppliers. This has led to replacement with expiry date of long term.

Implementation of information technology has resulted in the advantage to the process at SKMC. There is more to get in this field and there are some areas of improvement that should be the next destination.

Tracking of consumable items of patients in the patient clinical areas are being done using manual traditional methods. A software called Sargent is used in nursing for tracking the items utilized by patients during the treatment that is done in house. There is variation between one consumption of one staffs and other. Oracle ERP system enables the submission of order of the clinical resource staffs at the service areas. It is also used to replace the items as this will let to tagging the name of patients and therefore the medical records. Specific clinic or ward for serving the life of patient by giving the same ordering process to logistics and providing them with the required items (Mangan et al.  2016). Such orders are closed by logistics and goes through the oracle software.

Such process are not fully automated and is regarded as incomplete and in the current scenario, there is no integration between Oracle and Sargent. There is a standalone system that helps in tracking of the instruments and medication utilized by patients. Reordering takes place through manual function. While the Oracle ERP system, helps in ordering process of such items as this enable the logistics in properly delivering the items and purchasing.

It is highly recommended by me to make an investment in area that would help in replacing of the manual process. This can be done by implementation of software that would enable communication between both the systems and replacing the manual system with an automated process. Needed materials for ordering beds and clinic can be accessed using this system. Oracle system can directly help in generating the order. It is possible the transfer the information of medical records of patients and supply chain on spot and scanning of meaning items can be done using the automated system. Manual process of the organization would have less time spend with the help of such tool and the same order would be filed with two request. Automation of the process would results in utilizing the staff time effectively, improving effectively and providing accurate online report (Johnson 2014).

There are similar challenges faced by department of Clinical Sterilizing Supply. Challenges are faced in tracking the movement if items in and out of department sing the machines named T doc. In this, machines scan all the barcode items.

In order for the ERP system to have all sort of information, there is a requirement of making an integration between the systems. This would also help in avoiding duplication of data entries.

4.1: Logistic role in supply chain management:

Healthcare organizations are increasingly pressurized for increasing and improving the efficiency of logistics and hospital procurements. This challenge is in light of market challenges de to global influence and changing demands of requirements and customers. High quality of service is provided by the logistics with reduced costs with the help of logistics employed by organization. Multiple actions and activities are employed by SKMC hospital. Such activities include flow of people and material, theaters, wards, different buildings, workstations, laboratories, transportation, ambulance, catering, disposal, administration, laundry and clinging. The success of hospital is being enormously influenced by these components (Groves et al. 2016). Therefore, there is effective and efficient utilization of procurement and logistics. There is a proper coordination and sage between different activities, which enables providing good and quality device while providing them at minimal level by way of controlling expenses.

I would explain value played by logistics at three critical departments of SKMC after analyzing the importance of procurement and logistics in healthcare. Role of logistics at the operation theatre, pharmacy and home care are three departments.

  • Role of logistics at operating room of SKMC:

The department of operating room orders consumable concerning Cardiac perfusion and such order is done in bulk of big quantity. Some of the order is at the local stores and some other is stored at central store. Central store is regarded as the point for consumption and replacement of order. The gap after making use of half the quantity is filled by the initiative taken for making new order quantity.

The current system is faced with the challenges and the main challenges concerning the system is time uncertainty required in process of manufacturing. Another challenge is the time required for shipping. There are some challenges relating to the regulations and rules and this is mainly related to global and local occasions. For instance, such regulation and cultural challenges concerns long holiday for Christmas in Europe and Ramadan holiday. Such challenges are related and it ends with delay or cancellation of case that is booked for operations and delay in items being delivered.

There are some business lost by the current system concerning delay or cancellation and the resultant impact is the development of new process of logistics. This process has been developed by taking many corrective actions.

  • Awareness of the manufacturing time to be considered needs to be enhanced
  • High risk of dependency of organization on one vendor is reduced by engaging the business development with multiple vendors.
  • For the minimum and maximum requirement of items per month, there is a need for communication between store and vendor.
  • Order should be planned accordingly by making an evaluation of previous data and such data assists in addressing total number of surgeries performed by doctors in a month.
  • Integrating the logistics stock availability with payment links by enhancing control and finance.
  • Confirming the availability stocks should be made at maximum level during and before long holidays.
  • Sating updated with the availability of stocks by enhancing the internal communication within the store and organization.

After addressing the corrective actions, changes brought has led to dramatic development in control management of logistics, automating the control system of storage, risk reduction because of unavailability of items enhancing the operations smoothly and eventually improving the operations of business and thereby objectives of organizations (Ellram and Cooper 2014).

  • Role of logistics at Home care department of SKMC:

Residents and nationals of Abu Dhabi city are provided with the crucial services by SKMC home care department. Geographical residents comprise of residents of north and south parts like Shamma, Beda Zayyed, Swehan, Been El Jersen and areas of island. Clinical teams are provided with the shuttle for visiting patients at home and providing proper treatment and examination. For the hospital, results and information of patients are being updated. Preparing the treatment and need of medication and there is a need of awareness of clinical progress of patients.

Different geographical areas are provided by efficiency increment as a part of role played by logistics. This would also ensure that there is enough material and services provisions related with home care.  There is a proper logistics service, materials and instruments supporting nursing and teams of doctors. Process of logistics and utilization of transport can be improved by optimizing the teamwork and sometimes with instrument and medicine. It would also include development of process for supplying the people for needing the care with materials by reducing expenses and costs along with maintaining highest quality of service and products.

  • Role of Logistics at SKMC pharmacy:

One of the factor contributing to the success of organization is the important role played by department of pharmacy. There are few divisions in pharmacy department and it comprise of Emergency room pharmacy, Outpatient pharmacy store, Medical pharmacy store and in patient pharmacy. Due to operational need of hospital, these stores operates on 24/7 basis. These departmental stores of pharmacy helps in providing consistent medication to external customers as well as medication to resident patients (DeFrancesco 2014).

4.2: Evaluating procurement practice of organization:

Cost reduction and efficiency increment is the concern of logistics department in Pharmacy of SKMC. Such concern relates to process of storage and operation of logistics within the main department. In relation to development of logistics, following have been achieved by SKMC and they are as follows:

  • Managing the stores on intelligence basis incorporated with high security of supply and distributions.
  • Meeting the needs of patient and customers, by developing a transparent, stable and straightforward process of logistics for all the items of pharmacy.  
  • Managing the automation and optimizing the process of business
  • Imbibing temperature alarm coverage for monitoring the professional store and securing it.
  • Designing efficient system and making the flow process effective with the help of technological integration.

4.3: Evaluating procurement practice of SKMC

Procurement department of SKMC in its supply chain plays a crucial role. Organization strives to deliver different requirements and unit orders by linking the needs of professionals. There is an end users with vendors goods and products for suppliers. The largest SHEA facility is the procurement department of SKMC that supports the facility and other shortage. Unplanned needs of business and unexpected order of business is met by maintaining strategic stock of business as a part of healthcare facilities. Government and private sectors are also supplied with controlled and restricted medicines for medical cases of narcotic (Rushton et al. 2014). Medication of local market is supplied is supplied by SKMC and it is regarded as the only authorized organization. Following are the main tasks, performed by procurement department of SKMC:

  • Negotiation agreement- It concerns about discussing offered price with the suppliers for maintaining deliver stem that is convenient and at the lowest price. This is done by considering the work and competitors that is leading to the situation of win-win strategy.
  • Finalizing contract and  service agreement- Services are provide to the department such as catering, Security, laundry and it is managed by all the departments. Oracle system helps in receiving the orders through the online platform for processing such service. This is done by working with department of supply for meeting the demands and needs of customers.
  • Standard quality and best price at convenient time- Among the various offered quotations, the procurement department strives to get the best price. The department also considers the maintaining highest quality standards and fastest delivery time.
  • Activity sponsoring and free of charge items- For getting the extra benefits, the department is looking forward for establishing strategic relationships with suppliers. Such service would include employees training, sponsoring of specific activities by suppliers and major contracts or agreements.
  • Waste reduction- Reducing the waste of operation of surgery, sealed materials and sterilized instruments should be order once they are in need. Operating procedures and behavior needs to be changed. It can be explained with the help of example, the hip replacement surgeries, there would not be requirement of joints, brackets, instruments, screws and materials. It might not be possible to use all these materials.
  • Enhancing agreement with suppliers- In this aspect, the aim of organization is to maintain special agreement with the suppliers and reducing the stock on shelves. This would enable the organization to receive the materials ahead of the day of surgery and making preorders for the full years. For the specific items, expected future demand can be shared by hospital.
  • Getting direct supply and reducing order time for surgery- All the operating rooms should not be supplied with the material related surgeries and it is essential to equip and furnish all the rooms. However, this might not be used for long time rather than centralizing the storage service.

There is an increased competition and challenge between companies. In the current scenario, there is an increased need for effectively utilizing the resources of organization, saving and reducing costs and thereby maintaining the quality service of high level.

5.1: Strategy for improving supply chain:

Overall business of the organization remains aligned with the strategic supply chain. Same strategy is followed by supply chain when the strategy of business is to be the lowest cost provider. Competencies are the main thing, which the management usually focuses on while developing strategy of business. Capability of organization for effectively managing the operations of business and optimizing on the expenses and cost reduction for the supply chain management.

SKMC would be able to achieve its objective by supply chain utilization. Competency and performance of supply chain is evaluated by the organization and this would help in shifting the direction of business on segment and specific market. It is certainly possible for business to change the segmentation of customers, lower the costs of products and ultimately providing different customer service (Schönsleben 2016).

Recommendations made for improving the supply chain management, it would be suggested by me that there is a need for enhancing the automation process of organization. This would lead to organization phasing out usage of paper at hospital and converting into soft and electronic documentation and therefore saving lots of money as a result of phasing out of fax machines and printers.

Shifting to integrated and sync system would assist the organization in using a single source of information. This would enable communication in quick and fast way. Using the unified platform enables by sync between the systems will help the user allowing them multiple applications. Easy updating is required and planned and preventive maintenance helps in empowering the employees, improving experience and knowledge with one unified system. Such system would help in saving lot of efforts and time for professional information and for end users.

5.2: Improving strategy of supply chain management:

Strategic relationship needs to be enhanced by enhancing agreements with the suppliers. This would help the hospital in getting the best products at the competitive price. It is necessary for hospital to make suppliers acquainted with the order details of next years. Suppliers would be assisted as they would be able to plan proactively to get the items at convenient price.

Strategic management of supply chain would effectively manage resources of hospital resulting in activities that are more productive. This would involve shifting to high costs in the beneficial areas which would lead to service enhancement, improvement in production and improvement in satisfaction of customers.

It can be said in conclusion that services provided to customers can be enhanced without sacrificing the quality by managing the supply chain effectively. Hospital would be benefitted with activity that is more productive by utilizing the saved funds. Some of the areas that can be benefitted are improvement in hospitality, enhancing education and research so that it is possible to go beyond the expectation of customers. This would help in improving stability of the overall business by remaining at competitive stage (Ralston et al. 2015).

Lastly, capital flow of the business would help in enhancing and expansion of business by making reduction in the fund that is allocated to the business. This would help in making the effective utilization of current resources. For instance, success at organization will lead to satisfaction, improvement in strategic relationships with key stakeholders such as partners, employees, customers, board members and suppliers. This would help in enhancing the reputation of hospitals in the market and assisting in the stability and growth of business and making an enhancement not in its activities.

5.3: Barriers of supply chain management:

Due to growing competition in today’s world, organization strives to maintain position of sustainability for improving profitability and reducing costs. Falling of supply chain under expenses is the second biggest portion of expenses. This area calls for effective management by reducing the expenses and costs of supply chain. However, there are various challenges faced by management in dramatic improvement of expenses and costs reduction. There are two types of barriers faced by organization in this regard. They are as follows:

  • External barriers challenges in the supply chain improvement

External barriers such as barriers resulting from regulatory environment that increases risks and costs prevent development of supply chain. Operation process of hospitals might get delayed due to poor function and instability of procedures of government.

Organization such as SKMC as a high dependency on medical and clinical products that is imported. This poses another challenge to the healthcare sector in UAE in general.

Internal barriers affect the supply chain:

One of the biggest challenge faced by SKMC is the integration of system. There is a difficulty in obtaining data that can be integrated into the system such as material management information system and enterprise resource planning. Another challenge faced by SKMC is difficulty in utilizing new products. An approval is required by SHEA as they are committed to use the products approved by them. Limitation imposed by government would help in would prevent the hospitals from utilizing new developed products and materials. Lack of fund for specific activities or programs is another barrier faced by SKMC. This is so because different programs might obtain higher priority and the initiatives taken would be very limited.

Lastly, it would be mentioned by me that recruiting of expertise are made by regulatory and governmental procedures and this is making the supply chain a very difficult process. External recruiting has been made difficult by conflicts of regional politics and nationalization program.

It can be said in the conclusion that the way cost reduction is handled by healthcare organization is the supply chain. An effective role is played by system integration in healthcare organization.

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