Supply chain innovation and organizational performance in the healthcare industry

The purpose of this paper is to examine supply chain (SC) innovation for improving organisational performance in the healthcare industry.

A research model is proposed which describes the impact of SC innovation, supplier cooperation, SC efficiency, and quality management (QM) practices on organisational performance. The proposed research model and hypotheses were tested using structural equation modeling based on data collected from 243 hospitals.

The results of the study support that organisational performance is positively associated with constructs of each SC innovation factor. Innovative design of SC has a significant impact on selection of and cooperation with excellent suppliers, improved SC efficiency, and encouragement of QM practices.

The data used in this study were collected from relatively large hospitals with more than 100 beds in South Korea. The generalization of the study results may be limited by the size of sample hospitals.

This study provides useful planning information in the healthcare industry. The results suggest successful implementation of SC management is attained through continuous SC innovation with supplier cooperation, which in turn improves organisational performance.