From Reactive to Resilient: A Supply Chain Playbook for Healthcare Leaders

Your supply chain team is good at putting out fires. The backorder gets managed. The substitution gets approved. The gap gets covered. But if your organization is spending more time responding to disruption than running a stable operation, the problem isn't execution—it's infrastructure.

In Part 1 of this series, we explored the external pressures on healthcare supply chains—tariffs, inflation, vendor consolidation, care migration, and more—that are driving sustained cost and operational strain. Much of this pressure sits outside your organization’s control and isn’t abating anytime soon. What you can control is how your operation is structured to respond.

This second article in our three-part series outlines a practical framework for building a more resilient supply chain, drawing on insights from our recent webinar: From Volatility to Value: Strategic Supply Chain Priorities in 2026.

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Build a Supply Disruption Team

Supply chain resilience starts with how your organization responds to disruption, and that requires treating it as a permanent operating condition rather than an episodic event. It has to be managed as a permanent condition. That means standing up a dedicated supply disruption team with the authority and infrastructure to manage it as an ongoing operating function.

“We know disruption is here to stay. It’s not going away. So, the first step is to put together a supply disruption team to track high-exposure categories, plan ahead, and handle issues as they arise.” -Carolyn Howard

A supply disruption team carries out several important functions:

• Tracking high-exposure categories. Knowing in advance which product categories carry the most substitution risk, the most upstream volatility, or the highest patient impact if they go on backorder.
• Managing pre-approved contract language. When a supplier tries to insert a tariff clause or force majeure provision mid-contract, your team isn’t starting from scratch on legal review.
• Maintaining pre-approved alternatives. Keeping clinical substitutes that have already cleared value analysis, so the response to a backorder is execution rather than deliberation.

This isn’t a one-time project. Alternatives change, and supplier risk profiles shift. The supply disruption team needs to monitor continuously as conditions evolve.

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Restructure Value Analysis

It’s also worth taking a fresh look at how your organization manages value analysis. Traditional value analysis programs were built for a more stable supply chain environment. But health systems today must move quickly on decisions while balancing clinical safety with financial performance under sustained margin pressure.

What’s required is a nimbler structure that matches the speed of the decision to its stakes. A three-tier approach accomplishes this:

Tier 1: Just Do Its. These are commodity items (e.g., exam gloves, can liners, hot and cold packs) where the patient outcome footprint is minimal. These items don’t need a committee. They need a small, trusted team (supply chain plus a few nurse advisors with delegated authority) that can make and execute a substitution decision within a week.

Tier 2: Nursing Council Review. Clinical preference items, including lower-level physician preference items (PPIs), belong here. These require review, research, and a business case, but this should function as a working group, not a committee. Think of it like formulary management: outcomes data, financial analysis, product research, and a clear decision on whether the item belongs in the organization’s portfolio.

Tier 3: Service Line Review. Organized around major clinical areas like orthopedics and cardiovascular, this is where the most impactful, invasive products—robotics, implants, and similar technologies—undergo the most rigorous review. Physicians, infection control, and reimbursement are all at the table. Clinical protocols and decision matrices are built here to guide product selection. Once direction is set, supply chain executes, contracting based on guidance from these committees.

The goal is a value analysis structure that can move quickly on low-stakes decisions without sacrificing rigor on the ones that matter most.

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Centralize Purchased Services

Purchased services are often an unseen and under-managed area of the healthcare supply chain. With 100 to 300 distinct categories, the scope is highly fragmented and difficult to see end-to-end. That lack of visibility can show up in a few ways:

Off-contract purchasing. A negotiated contract may exist, but if it isn’t widely understood or followed, purchasing can shift off contract, often at significantly higher rates. The issue isn’t the contract itself, but that people are making decisions without full awareness of what’s available.

Selective pricing that shifts cost elsewhere. Some suppliers specialize in high-margin categories and offer attractive rates in targeted areas but make up for those discounts by charging more on “bread and butter” commodity items, resulting in higher net spend.

Incomplete view of dependencies. Moving spend to a secondary supplier with better pricing in select areas can seem like a win, but it can unintentionally increase costs on what remains with the primary supplier, who then raises prices elsewhere and increases overall spend.

Given this, purchased services require centralized control to create enough visibility for deliberate, fully informed decision-making across the organization.

“Purchased services represent one of the largest untapped opportunities today, with hundreds of categories operating like micro-businesses inside the organization.” -Paul Weintraub

This raises a decision hierarchy for purchased services: Is this a significant area of cost? If yes—do we have the internal expertise to manage and negotiate it effectively, or does a specialized external provider have an advantage?

The answer will be different for every organization, but the question needs to be asked since this is an area of significant opportunity for health systems.

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Rethinking Cost Beyond Unit Price

Supply chain leaders should also shift from unit price thinking to total delivered cost. Too often, organizations negotiate unit price and assume cost has been managed, but it hasn’t.

Total delivered cost includes freight, inventory carrying costs, waste, substitution risk, contract escalators, fuel surcharges, and a half-dozen other variables that can make the actual cost of a supplier relationship look very different from the line-item price.

Ask suppliers for greater transparency into these components and build the analytical capability to evaluate what’s driving cost, including operational pressures being passed through in pricing.

With this level of insight, organizations are better positioned to evaluate what they’re actually paying for and where there may be opportunities to reduce cost by addressing specific components of the total delivered cost.

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Build a Supply Chain Control Tower

A resilient supply chain depends on one thing above all else: visibility. Real-time, actionable, executive-level visibility into what your supply chain is actually doing.

A control tower is the infrastructure for continuously monitoring supply chain data through key indicators like fill rates, price changes, days of supply, and total delivered cost. It can surface cost anomalies before they compound and provide dashboards for timely decisions rather than quarterly post-mortems.

That visibility should cascade across the organization, helping teams catch cost spikes early and correct course before they escalate.

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Extend the Supply Chain Beyond the Four Walls

Finally, as care migration reshapes where services get delivered, supply chain can’t remain primarily organized around the acute care hospital. Sg2's 2025 Impact of Change Forecast projects 18 percent growth in adult outpatient volumes over the next decade, compared to only 5 percent growth in adult inpatient discharges, a shift that supply chain infrastructure built for the acute care environment is not designed to absorb. Ambulatory surgery centers, hospital-at-home programs, and home care settings all have distinct supply needs, and the contracts and distribution networks built for the acute environment don’t always translate cleanly.

Products that are right-sized for acute care may be the wrong unit of measure for home care. Distribution infrastructure built around centralized hospital receiving might not serve a network of dispersed ambulatory sites. Extending the supply chain requires deliberately mapping what those non-acute settings need and making sure contracting and logistics are designed to reach them effectively.

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Resilience Starts with Infrastructure

Everything in this playbook connects to an underlying principle: a resilient supply chain is one with standing infrastructure. The disruption team exists before the backorder. The value analysis tiers are defined before the new product request arrives. The purchased services governance is in place before the next contract renewal, and the control tower is monitoring conditions in real time.

Building that infrastructure takes time. But organizations that have it manage supply chain volatility better than those that don’t, and the difference shows up on the bottom line. Supply chain resilience isn't a project with a finish line; it's an operating capability you build and maintain.

Supply chain resilience is also reflected in how organizations approach contracting. Part 3 of this series explores how to move beyond GPO reliance and build a more intentional, value-based approach to supply chain contracting.

Is your supply chain delivering its full strategic value?

• Explore Part 3: Supply Chain Contracting Strategy – Coming Soon
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