• Advertise
  • Contact Us
  • Supplier Directory
  • SCB YouTube
  • About Us
  • Login
  • Subscribe
  • Logout
  • My Profile
  • LOGISTICS
    • Air Cargo
    • All Logistics
    • Facility Location Planning
    • Freight Forwarding/Customs Brokerage
    • Global Gateways
    • Global Logistics
    • Last Mile Delivery
    • Logistics Outsourcing
    • LTL/Truckload Services
    • Ocean Transportation
    • Parcel & Express
    • Rail & Intermodal
    • Reverse Logistics
    • Service Parts Management
    • Transportation & Distribution
  • TECHNOLOGY
    • All Technology
    • Artificial Intelligence
    • Cloud & On-Demand Systems
    • Data Management (Big Data/IoT/Blockchain)
    • ERP & Enterprise Systems
    • Forecasting & Demand Planning
    • Global Trade Management
    • Inventory Planning/ Optimization
    • Product Lifecycle Management
    • Robotics
    • Sales & Operations Planning
    • SC Finance & Revenue Management
    • SC Planning & Optimization
    • Supply Chain Visibility
    • Transportation Management
  • GENERAL SCM
    • Business Strategy Alignment
    • Customer Relationship Management
    • Education & Professional Development
    • Global Supply Chain Management
    • Global Trade & Economics
    • Green Energy
    • HR & Labor Management
    • Quality & Metrics
    • Regulation & Compliance
    • Sourcing/Procurement/SRM
    • SC Security & Risk Mgmt
    • Supply Chains in Crisis
    • Sustainability & Corporate Social Responsibility
  • WAREHOUSING
    • All Warehouse Services
    • Conveyors & Sortation
    • Lift Trucks & AGVs
    • Order Management & Fulfillment
    • Packaging
    • RFID, Barcode, Mobility & Voice
    • Warehouse Automation
    • Warehouse Management Systems
  • INDUSTRIES
    • Aerospace & Defense
    • Apparel
    • Automotive
    • Chemicals & Energy
    • Consumer Packaged Goods
    • E-Commerce/Omni-Channel
    • Food & Beverage
    • Healthcare
    • High-Tech/Electronics
    • Industrial Manufacturing
    • Pharmaceutical/Biotech
    • Retail
  • THINK TANK
  • WEBINARS
    • On-Demand Webinars
    • Upcoming Webinars
    • Webinar Library
  • PODCASTS
  • WHITEPAPERS
  • VIDEOS
Home » Logistics » The Evolving Healthcare Supply Chain

The Evolving Healthcare Supply Chain

October 17, 2011
SupplyChainBrain

Nationwide healthcare reform is having a significant impact on the industry's supply chain, says Eric O'Daffer, research director with Gartner. The effects are especially being felt in the executive suites of hospitals. Reduced reimbursement levels, along with the ever-growing need to scrutinize cost, is creating a "burning platform" for healthcare managers. What's more, given that supply-chain processes today account for between 40 percent to 45 percent of a hospital's total operating costs, "supply chain is on the hot seat."

Managers are being driven to standardize processes. They are being forced to become more aggressive about controlling users' preferences for certain products. "They're now needing to look at what the patient outcome is from that procedure," says O'Daffer, "and how much they're getting reimbursed."

Purchasing groups, which control the spend for multiple hospitals, are gaining in importance. At the same time, their overall goal and purpose are evolving. Today, they are looking to achieve lower levels of cost by aggregating demand locally, and committing to specific volumes. The strategy involves making targeted purchases. "People don't say, 'Here's our volume in theory,'" says O'Daffer, "but 'Here it is in aggregate.' They're willing to be held accountable for their decisions."

O'Daffer sees three major changes occurring in the healthcare sector. There's a strong move to capture and standardize products, allowing managers to gain control over all non-labor-related spend. There's an attempt to tie the choice of products to patient outcomes. And hospitals are increasingly moving toward owning their distribution processes, opening consolidated service centers, and taking control of "hundreds of millions of dollars" in supply-chain expense.

To view this video interview in its entirety, click here.

    RELATED CONTENT

    RELATED VIDEOS

    Logistics Global Logistics Logistics Outsourcing LTL/Truckload Services Forecasting & Demand Planning Inventory Planning/ Optimization Sales & Operations Planning Supply Chain Planning & Optimization Supply Chain Finance & Revenue Management Supply Chain Visibility Business Strategy Alignment Quality & Metrics Pharmaceutical/Biotech
    KEYWORDS Business Strategy Alignment Forecasting & Demand Planning Global Logistics Inventory Planning/ Optimization Logistics Logistics Outsourcing LTL/Truckload Services Pharmaceutical/Biotech Quality & Metrics Sales & Operations Planning SC Finance & Revenue Management SC Planning & Optimization Supply Chain Visibility
    • Related Articles

      The Evolving Healthcare Supply Chain

      The Evolving World of Healthcare Supply Chains

      Healthcare Supply Chain Vitals: Top Three Insights From the Annual UPS Pain in the (Supply) Chain Survey

    • Related Directories

      ProcureAbility

      GLS US

    SupplyChainBrain

    Russia Plans for Year-Round Arctic Shipping in 2027

    More from this author

    Subscribe to our Daily Newsletter!

    Timely, incisive articles delivered directly to your inbox.

    Featured Product

    Popular Stories

    • AERIAL VIEW OF A SHIPYARD SUPERIMPOSED WITH CYBERSECURITY SYMBOLS

      The Software Risk Hiding in Modern Supply Chains

      Business Strategy Alignment
    • On Demand Webinar Peak Zebra - SupplyChainBrain Webinar - Thu Oct 22 2026 2p ET.png

      RFID and Machine Vision are Having a Moment

      Webinars
    • GEARS MANUFACTURING iStock-bernie_photo-2219946641.jpg

      Five Current Challenges Preventing Real-Time Visibility in Connected Manufacturing

      Last Mile Delivery
    • 001_v1-(540p).jpg

      Watch: Closing the Skills Gap in Supply Chain Talent

      Education & Professional Development
    • MULTIPLE CHAOTIC CHARTS ARE SUPERIMPOSED ON AN AERIAL SHOT OF A BUSY INTERNATIONAL PORT

      The Quest for Supply Chain Resilience Remains Challenging

      Supply Chain Visibility

    Digital Edition

    Scb q3 26 cover

    100 Great Supply Chain Partners 2026: The Secret to Supply Chain Success

    VIEW THE LATEST ISSUE

    Case Studies

    • Recycled Tagging Fasteners: Small Changes Make a Big Impact

    • A GRAPHIC SHOWING MULTIPLE FORMS OF SHIPPING, WITH A HUMAN STANDING AT THE CENTER, TOUCHING A SYMBOLIC MAP OF THE WORLD

      Enhancing High-Value Electronics Shipment Security with Tive's Real-Time Tracking

    • A GRAPHIC OF INTERLACING HONEYCOMBED ELEMENTS REPRESENTING GLOBAL BUSINESS TRANSACTIONS

      Moving Robots Site-to-Site

    • JLL Finds Perfect Warehouse Location, Leading to $15M Grant for Startup

    • Robots Speed Fulfillment to Help Apparel Company Scale for Growth

    Visit Our Sponsors

    4flow Amazon Freight Anaplan
    Arkieva AutoStore Blue Yonder
    Canadian National Railway Company Carton Cloud CoEnterprise
    Dassault Descartes Dexory
    Duravant E2Open EPG
    General Logistics Systems GEP Hy-Tek
    iGPS Knapp Korber
    Lyngsoe Odyssey Logistics OMP
    PeakAI Procurability Quinyx
    SAP Sikick Staples
    S&P Global Mobility Systech TADA
    Tive TransImpact US Bank
    Werner WSI
    • More From SCB
      • Featured Content
      • Video Library
      • Think Tank Blog
      • SupplyChainBrain Podcast
      • Whitepapers
      • On-Demand Webinars
      • Upcoming Webinars
    • Digital Offerings
      • Digital Issue
      • Subscribe
      • Manage Email Preferences
      • Newsletters
    • Resources
      • Events Calendar
      • 2026 Event Coverage
      • SCB's Great Supply Chain Partners
      • Supplier Directory
      • Case Study Showcase
      • Supply Chain Innovation Awards
      • 100 Great Partners Form
    • SCB Corporate
      • Advertise on SCB.COM
      • About Us
      • Privacy Policy
      • Contact Us
      • Data Sharing Opt-Out

    All content copyright ©2026 Keller International Publishing Corp All rights reserved. No reproduction, transmission or display is permitted without the written permissions of Keller International Publishing Corp

    Design, CMS, Hosting & Web Development :: ePublishing