Technologies for an Effective Healthcare Supply Chain

Written by Tan Shi Ying Jacelyn, ADPSM

In recent years, healthcare expenditure continues to rise worldwide. Healthcare supply chain account for a big portion in the expenditure represents an opportunity to reduce the cost and improve patient care efficiency. The healthcare supply chain is a vast process and disintegrated network of products and players. Managing the flow of information, supplies, equipment, and delivering services from manufacturers to patients is complex in healthcare supply chains. The alignment of the supply chain to the care delivery model and the highly-regulated nature of healthcare is creating unique challenges.

Technology plays a key role to provide advanced planning, synchronization, and collaboration. Creating an advanced technology in healthcare supply chain have been driving efficiency and help contain costs while improving quality and care.

The graph shows the trends of important technologies in the healthcare sector.

IoT and RFID Tracking

Internet of Things or IoT adoption is growing in a supply chain process. IoT is a system of interrelated devices embedded with sensors, software, and connectivity to allow data transfer, integration and interact through the network without requiring human-to-human or human-to-computer interaction. GPS, RFID, UWB, WiFi and Bluetooth are common technologies within the realm of the IoT and championed within the materials handling and supply chain.

The number of devices that are going to be connected is increasing.

Asset tracking is always a daunting task in healthcare. The simple act to locate the asset can cost hours of lost productivity for staff. Healthcare sector has adopted the sensing technology such as RFID in the development of a tracking system. The RFID technology is expanding to drive accuracy and value in the healthcare supply chain. Adopting a real-time location system (RLTS) for tracking, locating and monitoring the asset. Healthcare staffs can track the real-time geographic location of equipment quickly. If equipment leaves a defined area, RTLS automatically triggers an alert. The use of RLTS in healthcare organizations is on the rise due to its precise visibility and traceability in real-time. By employing the systems, asset utilization rates improve and reduce the unnecessary purchase of extra inventory.

Automate inventory tracking with RFID smart cabinet not only streamlines in the healthcare supply chain but also improved visibility. Supplies that keep in a smart cabinet which sync with the inventory management system. The smart cabinets give a real-time inventory count, eliminate manually inventory counting, eliminate stock-out and manage inventory waste and expired items. This ensures inventory requirements are constantly met. Staff can focus on their primary role to deliver care to patients and not detract into inventory administrative task.

Drone Technology

The last-mile delivery to the customers has emerged as a critical source of opportunity for cost efficiency in the supply chain. Drones are one such technology that can have the potential and ability to provide healthcare supply chain a competitive edge in delivery vaccines, medications, supplies, and blood samples right to the source effectively and fast. Drones can assist with specializing and customizing delivery to customers especially in a remote area which lack of medical facilities. They can act as versatile courier device to assist with complicated deliveries. Instead of transporting essential medical supplies by a vehicle which take more time, the rapid delivery of medications and supplies by drones could quash outbreaks of life-threatening diseases. Using drones for delivery would reduce the cost of transportation, resulting in an affordable price for medications and supplies. To ensure patients have the supplies whenever required, healthcare organizations usually stock a lot of medicine that results in wastage when supplies expire. By using drone technology, supplies such as blood can keep in a central location and provide immediately to other locations when needed.

One of the best-known cases is Zipline from the USA. It changes the medical network through drones to deliver blood and vaccines in Rwanda since 2016. The use of the unmanned aerial vehicle in healthcare holds great promise and bring great possibilities in the healthcare industry. In the future, small indoor drones could deliver medicine to the patient bedside or home, thus free up the healthcare worker to spend more time with patients. This would result in better response time and less error in medication administrations.

3D Printing Technology

Traditionally supply chain, customers used to wait for a week for their product delivered but now with the infusion of companies such as Amazon and Alibaba, purchase decisions are made based on how fast they will receive the product. The opportunity for 3D printing rise due to the traditional supply chain constraints of the industry, the efficiencies of mass production, the need for low-cost labor, increasing of transportation costs and so on. In order to maintain a competitive edge, more and more companies have embraced 3D printing to create their products quicker.

In healthcare, 3D printing is positioned to be a great opportunity to revolutionize the medical device supply chain. 3D printing is introduced to substantively benefit the production of medical devices and the healthcare supply chain.

Supply Chain Ads

3D printing as one of the major disruptive trends that create its value in the printing of low volume, customer-specific and complex products within the confines of a single printer. 3D printing leverage digital profiles to print materials and create finished products in a variety of devices, such as in the production of prosthetic implants and limbs, as well as prosthetic dentistry. As a result, products can be manufactured from a 3D printer, and hence reducing the number of steps in the production chain. This technology removes the need for complex distribution networks and reduce overall logistics costs. In terms of the impact on inventory and logistics, it can be printed on demand. Hence, there is a less finished product on shelves, less wastage and inventory cost reductions.

AI and Predictive Analytics

Artificial intelligence (AI) has changed the way we manage, analyze and leverage data in the industry. As healthcare organizations develop more big data capabilities, it is time to move from basic descriptive-analytic towards predictive analytics. Predictive analytic monitor pattern and determine the likelihood of future events based on patterns in the historical and real-time data. Big data and algorithm production have reignited interest around predictive analytics. It is not just output graphs and statistics but something that’s actionable.

The diagram below shows the evolution of data over time.

In real-world, performing manual forecast and inventory management in the supply chain is a significant challenge as demand fluctuates to numerous market and macroeconomic forces. Traditional forecasting is unreliable as it cannot predict farther out with accuracy. With predictive analytics in play, healthcare organizations can leverage statistical data helped to manage the supply chain by reducing variation and gain more insights into demand patterns and supply utilization. With more accurate forecasting, the data-driven decision can be made to negotiate price, reduce demand and supply variation, and optimize inventory planning.

Harnessing the power of data analytics to predict the pattern and make the decision allow warehouse a more accurate picture of the inventory to keep in stock while reducing forecast error. This drives supply chain efficiency, as well as more visibility into supply issues and reducing costs.

Robotic Process Automation (RPA)

There is a significant number of repetitive tasks, manual and labor-intensive in the healthcare supply chain such as procure to pay, receive to replenish, and clinical integration. This typically adds time and cost to the supply chain and increase the possibility of human error. With these challenges, Robotic Process Automation (RPA) is poised to create value to streamline the healthcare supply chain. RPA deploy smart software for the machine to automate relatively straightforward, high volume and repetitive operational tasks throughout the supply chain. Adoption of RPA can automate those routine tasks will enhance efficiency, eliminating human error and reducing overhead.

RPA is being introduced for order processing and payments. Today, there are organizations still process transaction on manual labor and documentation. This also includes manually entering the information in the database. Automating back-office tasks with RPA can increase work efficiency and information can be directly linked to the company database. Thus, allowing staff to focus on high-value activities, eliminate a monotonous piece of work.

With increasing order volumes and multiple products to navigate, RPA is also deployed for warehouse modernization. This automation process is to perform warehouse process including picking, sorting, storage, retrieval, loading, and unloading. Adoption of robots in warehouse logistics can be used long hours at high speed before a mechanical failure and hence maximize productivity and efficiency.


Healthcare is an ever-changing landscape and healthcare providers are continuously looking for better processes, treatment, and supplies to provide the best care. In the healthcare supply chain, technologies will play a prominent role in enhancing efficiency and reducing cost. In view of the benefits prompted by technologies, the combination of technologies and existing supply chain system has to be developed to revolutionize the healthcare supply chain.

Although technologies offer tremendous potential for the healthcare supply chain, the need for initial investments and financial support post a big challenge. To create a healthcare supply chain that is sustainable in long-run, healthcare leaders should anticipate how to achieve a balance between financial, efficiency, confidentiality and transparency with technologies in the healthcare supply chain.


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About the Author: Jacelyn Tan has several years of experiences in the field of procurement and supply chain, and specifically in the healthcare sector. She is a member of the Singapore Institute of Purchasing and Materials Management (SIPMM). Jacelyn holds the Master degree in Supply Chain Management from National University of Singapore (NUS), an and a Bachelor degree in Engineering from Nanyang Technological University (NTU). She completed the Advanced Diploma in Procurement and Supply Management (ADPSM) on July 2019 at SIPMM Institute.