3 Lessons COVID-19 Taught Us about Supply Chain Risks

HAP’s supply chain resiliency survey provides insights for future preparedness

November 01, 2021

During the early days of the pandemic, COVID-19 put our global supply chains to the test, especially in health care.

Now, as we look back at the past 18 months, it’s important to reflect on what we’ve learned.

We know what supply chain disruptions mean for health care facilities. Early during 2020, our supply chain headaches complicated our efforts to combat a novel virus, as everyday items like masks, gloves, and gowns became precious resources, and we struggled to source ventilators and other essential medical equipment needed for patient care.

Recently, The Hospital and Healthsystem Association of Pennsylvania (HAP) fielded a survey to supply chain leaders from across its membership to help better understand the supply chain impacts of COVID-19, and to determine what strategies may help mitigate future risks associated with supply chain disruptions. 

Here’s what we learned:

Lesson One: We need an honest assessment of supply risks

Our survey respondents offered a clear consensus: our supply chain risk strategies prior to COVID-19 were insufficient, and we need a deeper evaluation of future risk reduction strategies.

Looking back, it’s clear that our supply chains faced a confluence of challenges. COVID-19 caused significant disruptions to overseas manufacturing, and staffing shortages with national and international logistics companies increased delivery lead times for many products. This, combined with unprecedented spikes in demand for everyday medical items, strained our once-secure system for supplies, and forced us to scramble for solutions.

One-hundred percent of our survey respondents experienced some degree of supply chain disruption during the pandemic. As we move forward, we need to evaluate our previous risk-mitigation strategies and determine where we could be vulnerable during the next emergency.

Lesson Two: Our supply chains will face new threats after COVID-19

The overwhelming majority of survey respondents said they do not expect our supply chains to go another ten years without another major disruption.

While we’d hope for a reprieve from our supply chain stresses, we know we must remain ready. In emergency management, we are presented with the unenviable task of predicting the future, and we know that the next seismic supply challenge could be just around the corner.

We only have to look back to 2017 and 2018 for an example, when Hurricane Maria ravaged Puerto Rico and disrupted the global pharmaceutical and medical device supply chains.

In an interconnected world, severe weather, infectious disease outbreaks, and staffing challenges don’t happen in silos. We have to account for supply chain risks wherever they may occur around the world.

Lesson 3:  A diverse approach helps reduce risks

All of our survey respondents are pursuing supply risk reduction strategies. These strategies are many and varied, and illustrate the nearly endless considerations that go into managing supply chain risk.

Among the notable strategies:

• 70 percent of respondents are pursuing strategies related to their sourcing and contracting strategies 

• 70 percent are looking to work with other health care providers to improve supply chain resiliency 
• 60 percent are looking to increase the number and diversity of suppliers in key categories

Our survey reminds us of the challenges we face, and the stakes at hand for hospital leaders around the world.

Patients come to our hospitals expecting outstanding care. The pandemic has only highlighted the challenging work that must happen behind the scenes to ensure these facilities have what they need to deliver that care.

If you are contemplating changes to your supply chain resiliency strategy, know that you are not alone. Supply chains faced significant pressure during the height of the pandemic, and they will be tested again in the future.

It’s important to know that there are strategies that can be deployed to harden your supply chain against risk. If you or your team would like to learn more about how you can manage supply chain risk, reach out to me or my colleagues at HAPevolve.