SUPPLY CHAIN 4.0 ON HEALTHCARE SYSTEM
Dr. JOSE S
BRISTO GEORGE
ROSHAN JOE MATHEW
BOSTINE BOSE
SEPTEMBER 2022
1
ABSTRACT
The management of the healthcare supply chain, which ensures the continuous supply of
drugs and medical supplies, is critical to society's service levels. One of the most complex
and challenging problems faced as a result of the globalization of health-care delivery is
securing the integrity and safety of the global medicines supply chain. Dangerous forms of
pharmaceuticals are illicitly sold by criminal elements and illegal transnational organizations
creating patient safety and public health dangers that undermine public and private
investments in health care. It is the most complex supply chain due to the availability of the
basic material from which medicines manufactured are available only in specific countries.
So pandemic indirectly impacts economy, health, social and political situations on every
other countries. Over the years supply chain model had to be changed significantly due to
evolving nature of business and globalization which resulted in offshore manufacturing and
using third party logistics for delivery of goods. Pandemic has created disruption in the
supply chain by introducing various constraints has led to reduced service level. Reports of
substandard and counterfeit medicines has increased a lot in recent times. Penetration of
these counterfeit drugs in to the healthcare supply chain made the global public health at
risk. This study perceives the supply chain management process for the rise in low-quality
and counterfeit pharmaceuticals, and it attempts to present a model with a flowchart to
establish a technique to prevent substandard and counterfeit drugs from accessing the
market. This research uses a ServQual model and its dimension that defines the
questionnaire. The ServQual model analyses five different dimensions using the prepared
questionnaire and using the obtained results Cronbach alpha values are being determined.
The calculated alpha values suggest the internal consistency of the dimensions analysed.
From these, the gaps are identified. A pilot survey was conducted to prove the reduced
service level and attempts to solve the visibility challenge by using BLE and RFID which is
an industry 4.0 tool. It will digitally track the flow of every product in the supply chain which
tend to increase the end-to-end visibility throughout the supply network
2
3
INTRODUCTION
The Covid-19 epidemic is wreaking havoc on many aspects of human life, particularly health
care. Healthcare is critical to human survival, and the supply chain must be robust in the face
of any disruption. Supply Chain disruption is described as "an incident or accident that might
obstruct the delivery of healthcare services to patients" in the health sector. Mitigation,
preparedness, and control of all such disruptions are more important in the Health Care
Supply Chain compared to other industries because of the direct impact on human lives and
the innate high rate of unpredictability.
Service and quality would be the most important criteria in these scenarios since human lives
are involved. Because it is a multi-dimensional research instrument designed to capture
consumer expectations and perceptions of a service along five dimensions that are believed
to represent service quality, the ServQual method is used by us to identify the most critical
problems through Cronbach's alpha values, which were faced by the people during this
outbreak.
There aren't many methods for creating end-to-end visibility in the Health Care Supply
Chain. In this paper, we discuss the issues which we found by using the SERVQUAL
technique and introduce our solution, which employs RFID and BLE across the chain.
Barcodes are labels that are applied to items or packages that include an optical machinereadable representation of data that indicates something about that package or product.
Barcodes have progressed from one-dimensional to two-dimensional to the ubiquitous QR
codes, which may store a long string of data to identify a specific object. This has specific
drawbacks like it is quite time consuming because it takes 3 seconds for every scan and
becomes labour intensive.
4
LITERATURE REVIEW
The main scope of the literature review is to present an idea of getting familiar with supply
chain model during and post covid. Get clear picture about the visibility level of drugs in
storage and their illegal stockpiling. A survey conducted based on the ServQual model to
identify issues in service level and address them. To counter the issue of illegal stockpiling
and counterfeit drugs, pharma companies have to implement end-to-end visibility of product
movement throughout the supply chain, which paves the way for introducing Bluetooth low
energy and RFID technology to track and trace the product with a unique code for each
product.
Following Globalization, the worldwide supply chain for important medical equipment
changed to reflect a variety of aims, including improved quality, accessibility, and price. At
this point, "lean" management has taken into consideration more proficient and compelling
strategic stream as well as further developed consumer loyalty. However, leanness has
likewise prompted affliction. Sadly, in diminishing expenses by means of work and supply
roads, this has prompted a decrease in clinical reserves which go about as "supports" during
emergencies like COVID-19. These fashions aren't without their challenges. It compromises
appropriate preparedness for pandemics. Along with this there was low initial supply and
low supply from the suppliers. This indeed pushed to develop new supply chain to procure
materials from different. The COVID-19 has uncovered the fragility of our current supply
chain frameworks. Increasing reviews on loss of trust and pressures among numerous
stakeholders had been reported. Intermediates possibly use opportunistic and unfair
commercial enterprise practices creating loss of transparency in reporting of inventory
numbers and the ambiguity in moves of transactions. This creates an environment that's
fertile for speculation, main to a breakdown of agree with and consequently the inter
relationships.
Visibility in medical care is surely crucial! Not knowing the course by which drug items
advance toward the purchaser can prompt gamble on fakes. Also, with FDA guidelines, life
science organizations need to follow medication and item data like authentic areas; time
spent at every area, a record of possession, exchange history, bundling setups, and natural
stockpiling conditions to productively and securely deal with the full lifecycle of such items
in the store network. Manufacturers agree with that track-and-trace technology will allow
accelerated operational performance via advanced product visibility, returns processing,
product keep in mind capacity and product security.
5
Using SERVQUAL, it was observed that the quality of service provided by pharmacological
transport and logistics contractors was such that perceptions for the quality of services
provided by these companies were greater than the standard level of quality obtained for all
aspects of service quality being analysed through Cronbach Alpha Values. Construction of
a questionnaire (survey) that will be beneficial in future study and statistical methods.
The main positive result is defined to be what is necessary to improve and assures good
quality. Dimensions with least Cronbach alpha values are said to have improper consistency.
Thus, it is to be addressed to ensure service level to the consumers.
BLE an industry 4.0 tool used to track products at each checkpoint. So, it ensures genuinity
of product throughout the supply chain. BLE and RFID so far used in targeting
advertisement, billing and inventory management. BLE and RFID has the potential to be
used throughout the supply chain. It has enhanced battery life to withstand throughout the
supply chain and even in the case of preparedness stockpiling.
OBJECTIVE:
To counter the issue of illegal stockpiling and counterfeit drugs, pharma companies have to
implement end-to-end visibility of product movement throughout the supply chain, which
paves the way for introducing Bluetooth low energy and RFID technology to track and trace
the product with a unique code for each product.
MOTIVATION:
COVID-19 is a global disaster that occurred in the end of 2019 and impacted 203 nations. In
reality, COVID-19 is an infectious condition caused by an earlier coronavirus variety. One
of the issues that societies are now facing is a lack of tools to effectively combat this
infection. Because this virus spreads quickly, every failure to control it significantly
increases the number of persons afflicted.
If there is a shortfall of medical/healthcare equipment in a community, a huge spike in the
number of diseased persons can cause an irrevocable and terrible disaster. During the Covid19 outbreak, there was a massive influx of workers from industrial units, restrictions on
transportation activities, particularly trucks, a lack of coordination between different
administrations, and transporters and couriers that were not operating on time. Each of these
elements wreak havoc on the supply chain, producing shortages of vaccinations, hand
6
sanitizers, testing kits, personal protective equipment, pharmaceuticals, hospital equipment,
raw materials, and even more. Because no definite treatment for the sickness has been
established at this time, providing certain ideas and solutions to minimise the breakout rate
of this disease, as well as synchronized administration of afflicted persons, can lead to the
breakdown or slowing of the virus chain.
With the introduction of new technologies, which minimise labour effort and progress things
(i.e., adopting INDUSTRY 4.0), now is the best moment to examine disruptions through
SERVQUAL method and give end-to-end visibility through new technologies to protect the
complicated Healthcare Supply Chain sector from future outbreaks.
GAPS IN THE LITERATURE:
When pharmaceutical producers sell their medicines to distributors, the link between them
comes to an end. This undermines the supply chain's end-to-end visibility, which gives the
way for distributors to stock illegally and sell at exorbitant prices in order to meet increased
demand, which was likely heightened during the covid-19 pandemic.
During the outbreak, the number of counterfeit/fake medications grew, which can only be
detected by the consumers for whom the producer is liable. Pharmaceutical companies were
more susceptible during and after the Covid-19 outbreak as a result of these flaws.
7
METHODOLOGY
8
TECHNICAL SPECIFICATIONS:
SERVQUAL MODEL:
SERVQUAL, commonly known as the GAP model, is a multi-item measure designed to
analyse customer perceptions of service quality in service and retail enterprises.
Furthermore, the GAP model integrates quality of service design from the customer's
perspective with the organization's assessment of customer expectations. The GAP model
of services quality with 5 gaps was shown below:
We considered that a mixed-method approach would be best for our research. The data was
collected and analysed using descriptive and analytical approaches. Both businesses and
customers were personally targeted. Because of the number of respondents and limited
fieldwork resources, we had to employ a stratified random sample, mostly from Tamil
Nadu.
We took steps to ensure that our questionnaire was suitable for achieving the study's goals
and evaluating our hypotheses. The difference between i) Retailers and Distributors and ii)
Consumers and Retailers was measured using SERVQUAL. This measure looks at five
aspects of service quality: tangibles, reliability, responsiveness, assurance, and empathy.
12 statements for retailers and 18 statements for consumers were used to grade dimensions.
9
To ensure that the shopkeepers understood the questions, the questionnaire was
also translated into Tamil and collected the responses through Google Forms.
DESIGN APPROACH AND DETAILS:
DATA COLLECTION:
In Tamil Nadu, we were locating about 20 retailers and 50 customers. The completed
surveys were circulated and collected by us. SPSS v.17 was used to enter and analyse the
data. The five quality dimensions were separated into their own variables.
STATEMENTS:
DIMENSION
NO. OF
STATEMENTS IN
RETAILERS
SURVEY
NO. OF
STATEMENTS IN
CONSUMERS
SURVEY
RELIABILITY
3
4
RESPONSIVENESS
2
4
ASSURANCE
2
2
EMPATHY
2
3
TANGIBILITY
3
2
The Questionnaire has prepared based on the dimensions provided in the ServQual model.
Here retailers survey is considered as perceived choice and consumer survey as
expectancy.
Questionnaire (Retailer):
GRADES
DIMENSION
QUESTION
Reliability
My Distributer is
reliable in terms of
handling damaged
medicines and
Strongly Disagree
Neutral
Disagree
1
2
3
Agre
e
4
Strongly
agree
5
10
solves problem
immediately
Shipments contain
wrong/ damaged
items
Distributor
effectively handles
expired or
counterfeit drug
issue
When distributor
promises to deliver
by certain time,
they do so
`
Responsiveness
Distributor
provides services at
short notice (if they
required)
Personnel in the
distribution have
the knowledge to
answer your
Assurance
queries
Making retailers
feel safe in their
transactions
Distributer gives
retailers individual
attention
Distributer
Empathy
provides
personalized
service to the
retailers
Distribution centre
has modern
equipment
Distributer has
sufficient physical
Tangibles
facilities for storing
drugs
Distributor
provides any
facility to check
fake product
1
2
3
4
5
1
2
3
4
5
1
2
3
4
5
1
2
3
4
5
1
2
3
4
5
1
2
3
4
5
1
2
3
4
5
1
2
3
4
5
1
2
3
4
5
1
2
3
4
5
1
2
3
4
5
11
Questionnaire (Consumer):
GRADES
DIMENSION
QUESTION
My retailer is
reliable in terms of
handling damaged
medicines and
solves problem
immediately.
When you have any
problem, retailer
shows sincere
Reliability
interest in solving it
Shipments contain
wrong/ damaged
items
Distributor
effectively handles
expired or
counterfeit drug
issue
The Retailer
provides services at
short notice "if
required"
The Retailer
provide home
delivery service
`
Responsiveness
Staffs in the
pharmacy know to
answer your
queries
Retailer quickly
apologize when
they make mistakes
Retailers provide
personalized
service to the
Assurance
consumers
Retailer make
efforts to
Strongly Disagree
Neutral
Disagree
Agre
e
Strongly
agree
1
2
3
4
5
1
2
3
4
5
1
2
3
4
5
1
2
3
4
5
1
2
3
4
5
1
2
3
4
5
1
2
3
4
5
1
2
3
4
5
1
2
3
4
5
1
2
3
4
5
12
Empathy
Tangibles
understand
consumer’s need.
Retailers who are
continuously
courteous to us
Retailer gives
consumers
individual
attention.
Personnel in the
pharmacy follow
covid protocols
Retailer has
sufficient physical
facilities for storing
drugs.
The Retailer
provides any
facility to check the
fake product
1
2
3
4
5
1
2
3
4
5
1
2
3
4
5
1
2
3
4
5
1
2
3
4
5
Here we used Likert’s score of range 1 to 5. Least score value of 1 and highest score value
of 5. Questionnaire was circulated with respective departments and with known networks.
Responders were classified by their age and zone for future research purpose. The average
age of responders was around 23yrs. Among 50 responders there is no much deviation and
shows two or three slabs to be considered. Responders of retailer survey was categorised
based on zones. Most of them were inside Tamil Nadu. This comes under one or two
clearing and forwarding agent.
CONSUMER
RETAILER
DATA ANALYSIS:
13
CRONBACH ALPHA VALUE:
Cronbach alpha is statistical significance parameter to check internal consistency of the
factors. Many research using Cronbach's alpha to characterise questionnaires aiming at
evaluating aspects in the emotional domain might be referenced. The presence of a "high"
alpha value does not mean that the measure is unidimensional. Additional analyses can be
undertaken if you want to give proof that the scale in issue is unidimensional in addition to
testing internal consistency. One way for determining dimensionality is exploratory factor
analysis. Cronbach's alpha, in technical terms, is a coefficient of reliability, not a statistical
test.
𝛼=
𝑁𝑐
𝑣 + (𝑁 − 1)𝑐
Variance as degree of freedom to calculate CA values checks the dispersion of values
around all the factors in the reliability test. The discrepancies between service quality
expectations and reality were measured with these statements. Cronbach's Alpha was used
to assess the scale's dependability.
DIMENSIONS
RELIABILITY
RESPONSIVEN
ESS
ASSURANCE
EMPATHY
TANGIBILITY
RETAILE
RS
SURVEY
3
CRONBACH’S
ALPHA
0.205
CONSUME
RS
SURVEY
4
2
0.816
4
0.766
2
2
3
0.323
0.832
0.852
2
3
2
0.673
0.592
0.327
CRONBACH
’S ALPHA
0.164
This shows there is gap in internal consistency for the reliability and tangibility which is
third gap defined by the dimension. A reliability test is to be carried out in the survey
values with the SPSS tool containing item total statistics. Which contains statistic of CA
values if deleted to check the CA values for the service dimension if one of the parameters
with least CA value removed.
CONSUMERS SURVEY:
Reliability Statistics
Cron Cronbach's
bach' Alpha Based
s
on
Alph Standardize N of
a
d Items
Items
.773
.767
15
14
Item-Total Statistics
Scale Mean
if Item
Deleted
Scale
Corrected
Variance if
Item-Total
Item Deleted Correlation
Squared
Multiple
Correlation
Cronbach's
Alpha if Item
Deleted
45.96
44.856
.348
.529
.763
When you have any
46.30
problem, retailer
shows sincere interest
in solving it
44.255
.336
.496
.764
Services will be
provided at the
expected time
46.62
52.404
-.292
.331
.807
Retailer effectively
handles expired or
counterfeit drug issue
46.04
46.162
.236
.386
.772
The Retailer provides 46.14
services at short notice
"if required"
43.021
.439
.519
.755
The Retailer provide
home delivery service
45.88
41.740
.431
.361
.756
Staffs in the pharmacy 45.90
know to answer your
queries
40.418
.664
.629
.735
Retailer quickly
apologize when they
make mistakes
46.00
40.694
.585
.564
.741
Retailers who are
continuously
courteous to us
46.14
41.021
.538
.684
.745
My retailer is reliable
in terms of handling
damaged medicines
and solves problem
immediately.
15
Retailer gives
consumers individual
attention.
45.82
43.783
.459
.650
.755
Personnel in the
45.80
pharmacy follow covid
protocols
41.347
.655
.689
.738
Retailers provide
personalized service
to the consumers
45.98
41.816
.562
.547
.745
Retailer make efforts
to understand
consumer’s need.
45.90
45.276
.194
.598
.780
Retailer has sufficient
physical facilities for
storing drugs.
45.74
44.319
.398
.593
.759
The Retailer provides
any facility to check
the fake product
46.82
47.253
.127
.303
.780
In CA values if deleted questions with highest value should be addressed. Is what
perceived in Retailer’s survey
ANOVA
Sum of
Squares
df
Mean
Square
161.968
49
3.305
Between
Items
64.595
14
4.614
Residual
499.312
685
0.729
Total
578.667
700
0.827
740.635
749
0.989
Between People
Within
People
Total
F
Sig
6.157
<.001
Grand Mean = 3.29
16
RETAILERS SURVEY:
Reliability Statistics
Cronbach's
Alpha
Cronbach's
Alpha Based
on
Standardize N of
d Items
Items
.885
.889
12
Item-Total Statistics
Scale Mean
if Item
Deleted
Scale
Corrected
Variance if
Item-Total
Item Deleted Correlation
Squared
Multiple
Correlation
Cronbach's
Alpha if Item
Deleted
My Distributer is
reliable in terms of
handling damaged
medicines and solves
problem immediately
36.33
49.133
.611
.751
.875
Shipments contain
damaged
items/incorrect
quantity
37.05
58.848
-.062
.640
.913
Distributor effectively
handles expired or
counterfeit drug
36.52
48.962
.529
.607
.881
When distributor
36.52
promises to deliver by
a certain time, they do
so
47.362
.638
.822
.873
17
The distributor
provides services at
short notice "if
required"
36.43
48.257
.762
.784
.866
Personnel in the
distribution know to
answer your queries
36.76
46.590
.851
.870
.860
Distributers making
retailers feel safe in
their transactions
36.33
55.833
.314
.522
.888
Distributer give
retailers individual
attention
36.81
47.962
.670
.811
.871
Distributer provide
personalized service
to the retailers
36.52
50.462
.680
.742
.872
The distribution centre 36.67
has modern
equipment
52.033
.619
.582
.876
Distributer has
sufficient physical
facilities for storing
drugs
36.43
49.757
.743
.828
.869
The distributor
37.10
provides any facility to
check the fake product
45.390
.868
.913
.858
Similar ways of rise in CA values if deleted in same question suggests that service
dimension and the associated question should be addressed.
ANOVA
Sum of
Squares
df
Mean
Square
98.246
20
4.912
Between
Items
15.377
11
1.398
Residual
124.040
220
0.564
Total
139.417
231
0.604
Between People
Within
People
F
Sig
2.479
0.006
18
Total
237.663
251
0.947
Grand Mean = 3.33
Service dimension of reliability and tangibility and the questions “The distributor/retailer
provides any facility to check the fake product” and “My Distributer is reliable in terms of
handling damaged medicines and solves problem immediately”. These questions are trigger
due to supply chain has faced failure in terms of end to end visibility. End to end visibility
indirectly restricts fake products used in actual market and we can have trust supply chain
actors and their products.
This paves the way for introducing visibility through a Bluetooth and Radio frequency based
device to keep track of products.
This study proposes a model and flowchart of process flow in handling the product tracking.
RESULT AND DISCUSSION
BLE and RFID:
BLE, how it works?
BLE – Bluetooth low energy
 BLE data transfer is a one-way communication.
 BLE beacon transmits packets of data at regular intervals.
 Data packets are received by apps/ software on smartphone nearby.
 This communication triggers necessary actions framed by the software.
Passive Radio Frequency Identification Device:
 RFID is one way data communication device.
 When Radio signal from the reader reaches the tag, it charges the RFID tag.
 Returns Data in the form radio signal
 RFID reader reads the signal
 This communication triggers necessary actions framed by the software.
19
Read range(in metres)
Power consumption
Battery life
BLE
Upto 100m
Less than 15mA
Upto 48 months
Passive RFID
Upto 10 cm
2-3 years
COST ANALYSIS:
The most basic form of BLE costs around 50 rupees and we can further include some
more sensors like GPS and temperature sensing. RFID is another form of device with
simple specifications.
Further we had discussion with sales team of pharma company. At first impression about
supply chain there is no supervision of products by pharma companies when it reaches
distributors. From manufacturer to distributor there was abduction of product and
replacement of fake and substandard products. So we are supposed to use BLE and RFID
technologies. We include three major supply chain Actors like following image.
MANUFACTURERS
DISTRIBUTION
PROVIDERS
Medical
Equipment
Stocking and
sourcing
locations
Hospitals
Pharmacies
Operation
supplies
Communication
Retail
Pharmacies
Pharmaceuticals
B
20
Data associated with tag and beacon: 14 digit unique code, Batch number and size,
date of manufacturing and expiry, manufacturing license number etc..
At each step, data from the tags are compared with data of manufacturer’s database. Any
unmatched code will be considered as fake product. A flowchart for standard procedure of
encountering visibility at checkpoint is visualized below.
21
Product validation- Flowchart:
CONCLUSION
22
The service Delivery system(Gap 3) has faced more challenges during COVID 19 pandemic.
A service delivery system is a collection of interconnected functions that provide services to
consumers or clients, which are also in terms of inputs, processes, outputs, and results.
Manufacturers unable to react and mitigate problems that are between distributors and
retailers.With technologies like BLE, RFID there would be a strong supervision of product
movement. Then the manufacturers will know each and every transactions happened and
then they can guide the third parties.So, we made a framework to solve the issue through
BLE and RFID that can track and trace products throughout the supply chain which would
give end to end visibility.BLE and RFID in the supply chain provide end-to-end visibility.
So any product that reaches the consumer through this technology should be considered a
genuine product. BLE and RFID technologies are instrumental in terminating illegal
stockpiles. In future cases, this excellence in the supply chain can sustain through the
pandemic or endemic’s disruption and ensures complete service level.
BLE and RFID gives the manufacturers the ability to track different goods/products in
transit, giving a clear view of the inventory and activity. It also enables shippers to increase
customer service, proactive status updates, limiting disruptions and risk mitigation.
Pharma companies can prefer this model because there is not much change in the regular
activities and cycle time. Knowledge transfer sessions are not required for the workers
because the HHD(handheld devices) are so simple and compatible to use. This model
ensures the manufacturers right product delivered to consumers at the right time.
FUTURE SCOPE:
There will always be opportunities in Supply Chain particularly in our project as BLE offers
the potential for smart warehousing, where it can provide turn-by-turn directions, reducing
process time. As it is a rapidly growing environment, systematic growth in service quality
must be pursued further. Digitalisation is about to dominate in services with high-tech
monitoring and remote-controlled equipment. As a result, the Health Care Supply Chain has
the ability to change over time.
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