The purpose of this paper is to use a systems lens to assess the comparative performance
of healthcare supply chains and provide guidance for their improvement.
Design/methodology/approach – A well-established and rigorous multi-method audit
methodology, based on the uncertainty circle model, yields an objective assessment of value stream
performance in eight Australasian public sector hospitals. Cause-effect analysis identifies the major
barriers to achieving smooth, seamless flows. Potentially high-leverage remedial actions identified
using systems thinking are examined with the aid of an exemplar case.
Findings – The majority of the healthcare value streams studied are underperforming compared with
those in the European automotive industry. Every public hospital appears to be caught in the grip of
vicious circles of system uncertainty, in large part being caused by problems of their own making. The
single exception is making good progress towards seamless functional integration, which has been
achieved by elevating supply chain management to a core competence; having a clearly articulated
supply chain vision; adopting a systems approach; and, managing supplies with accurate information.
Research limitations/implications – The small number of cases limits the generalisability of the
findings at this time.
Practical implications – Hospital supply chain managers endeavouring to achieve smooth and
seamless supply flows should attempt to elevate the status of supplies management within their
organisation to that of a core competence, and should use accurate information to manage their value
streams holistically as a set of interwoven processes. A four-level prism model is proposed as a useful
framework for thus improving healthcare supply delivery systems.
Originality/value – Material flow concepts originally developed to provide objective assessments of
value stream performance in commercial settings are adapted for use in a healthcare setting. The
ability to identify exemplar organisations via a context-free uncertainty measure, and to use systems
thinking to identify high-leverage solutions, supports the transfer of appropriate best practices even
between organisations in dissimilar business and economic settings