Research Proposal Anglia Ruskin University Cambridge

I submitted the following research proposal to the Anglia Ruskin University Cambridge, which was accepted and is now my basis for the MPhil/ PhD. Almost after one year into my research, it is still very helpful to look back to the initial proposal to remind myself of important research questions and the purpose. 

Working Title

Best practices for managing procurement and supply in the healthcare sector

Proposed area of Research

The suggested research is intended to identify, evaluate and apply new approaches and best practices in healthcare logistics management. Differentiating between healthcare providers, such as hospitals, and healthcare equipment manufacturers is a precondition to precisely define the scope of the proposed research, which will be limited to medical appliances suppliers, such as Siemens AG, General Electrics and Philips.

Context of research

Conventional supply chain practices like lean manufacturing and outsourcing in healthcare manufacturing have been regarded as difficult to apply to the healthcare sector, since healthcare manufacturing differs from other manufacturing industries (e.g. automotive and high-tech industries) in three main categories:

a)    Demand forecasting is more complex than for mass-produced commodity or B2C products, since these cost-intensive medical supplies acquisitions are infrequent or even one time purchases.

b)    Manufacturing medical equipment requires a higher amount of specialist, integrative knowledge from several professional backgrounds (Huebner & Elmhorst, 2008:18) because the end-user, i.e. patient, can be exposed to a fatal health risk deriving from x-rays

c)    There is a conflict between quality-based differentiation strategy and cost-driven strategy for medical supplies, which inarguably should not sacrifice quality for cost-savings (McKone-Sweet et al., 2005).

Therefore, it has to be carefully analyzed why best practices from other industries in SCM fail for the healthcare sector and how this respective industry can become more competitive in its logistics management using adaptive models and strategies.

Aim and Focus of the study

The focus of the research will be placed upon four main concepts in supply chain management in healthcare: procurement, just-in-time management, lean manufacturing and outsourcing.

Examining those four areas in respect to the healthcare industry, with all opportunities and pitfalls they may offer, will help to:

a)    Identify areas of operational improvement in SCM.

b)    Develop strategies that lead healthcare suppliers to embrace available tools and techniques to alter existing, outdated SCM practices.

c)    Benchmark the medical supply manufacturers against other manufacturing companies in terms of material logistics, waste-reduction, efficiency, etc.

Relevance

Healthcare equipment manufacturing is a global industry of multi-billion dollar scope that has long been overlooked in terms of efficient supply chain management due to its unique place in manufacturing. Secondary literature and revolutionary discoveries in operational theories often fail to adapt their models these specialized industries. Principles in outsourcing, lean manufacturing for instance, have proven to pose more questions and restraints in the healthcare sector and have to be made accessible to healthcare suppliers in order to provide them with incentives for switching to new best practices in supply chain management.

Rationale

My work experience in the SCM and Process Quality Department of Healthcare division at Siemens AG has spurred this interest and given me motivation for further research in this precise area.  There, I experienced first hand that particular SCM processes were either inefficient or outdated while others were not suitable for healthcare manufacturing. Disorganized inventory management, long lead times and critical quality problems due to outsourcing issues have unveiled a potential for change, which is not only advantageous for the company, but also for the suppliers and customer-relationships.

Research Methodology

The research for the thesis will be twofold:

a)    Existing literature will build a foundation and in-depth knowledge of existing theories in the field of general and healthcare-specific supply chain management.

b)    Expert talks and interviews will build the bridge from the theoretical, academic frameworks to the practical application within the manufacturing businesses. Therefore, a series of conversations with both with the head office and middle management will be scheduled to find out about motivations, aversions and opinions about new practices in supply chain management, to which extent particular strategies have already been applied and how these are perceived by employees, customers and other stakeholders. These empirical studies will be undertaken in three of the major healthcare suppliers, Siemens AG, Philips and General Electrics in order to research commonalities, patterns and qualitatively valuable bases of comparison.

Indicative References

Foxx, W.K., Bunn, M.D., McCay, V. (2009), “Outsourcing Services in the Healthcare Sector”, Journal of Medical Marketing: Device, Diagnostic and Pharmacetical Marketing 2009, Vol. 41 Iss 9.

Gattorna, J. (1998) Strategic supply chain alignment: best practice in supply chain management, Gower Publishing Ltd., Hampshire, England.

Gilley, K.M., and Rasheed, A. (2000) “Making More by Doing Less: An Analysis of Outsourcing and its Effects on Firm Performance”, Journal of Management, August 2000,Vol. 26 no. 4, pp. 763-790.
Huebner, U., Elmhorst, M.A., (2008) eBusiness in Healthcare – From eProcurement to Supply Chain Management, Springer-Verlag, London.

Hugos, M.H. (2006) Essentials of Supply Chain Management, 2^nd ed., John Wiley & Sons Inc, Hoboken, New Jersey.

Kumar, A., Ozdamar, L. and Peng Ng C., (2005) "Procurement performance measurement system in the health care industry", International Journal of Health Care Quality Assurance, Vol. 18 Iss: 2, pp.152 - 166

Ketler, K. and Walstrom, J. (1993) “The Outsourcing Decision”, International Journal of Information Management, Vol. 13, Iss. 6, December 1993, pp. 449-459.

Kollberg, B., Dahlgaard, J.J., Brehmer, P.O., (2006) "Measuring lean initiatives in health care services: issues and findings", International Journal of Productivity and Performance Management, Vol. 56 Iss. 1, pp.7 – 24.

McKone-Sweet, K.E., Hamilton, P., Willis, S.B. (2005) The Ailing Healthcare Supply Chain: A Prescription for Change, Journal of Supply Chain Management; Winter 2005; 41, 1; ABI/INFORM Complete, pp.4.

Rivard-Royer, R.H., Landry, S., Beaulieu, M. (2002) Hybrid Stockless – A Case Study, International Journal or Operations and Production Management, Vol. 22, Iss. 4., pp. 412 -424.

Schiederjans, M.J, Schiederjans, A.M., Schniederjans, D.G., (2005) Outsourcing and Insourcing in an International Context, ME Sharpe Inc, New York.

Smith, A.D., and Correa, J., (2005) "Value-added benefits of technology: E-procurement and e-commerce related to the health care industry", International Journal of Health Care Quality Assurance, Vol. 18 Iss: 6, pp.458 – 473.