Hospital-Supplier Integration and Hospital Performance in Saudi Arabian Context

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Saudi Digital Library
The level of demand in the healthcare sector has increased, hence it has become important for healthcare organisations to build and maintain relationships with suppliers so that they can secure the required quantity of supplies. Therefore, improving hospital supply chain performance has been increasingly essential in the world. Despite this significance, a review of the existing supply chain literature indicates that limited comprehensive studies have been conducted on hospital supply chain performance to date. Within a systematic literature review, this research develops a comprehensive conceptual model based on the impact of hospital-supplier integration on the overall performance of healthcare organisations. Furthermore, exploring the impact of moderating role of lean practices on hospital supplier integration and hospital performance. The context of this study is the Saudi Arabia healthcare sector, a two-tier healthcare system that is comprised of public and private sectors. To address the research objective, and to test the research hypotheses, this research employs a Structural Equation Modelling (SEM) based on a field survey. The survey was conducted amongst 435 hospitals in Saudi Arabia. A total of 2175 Participants in this study. The results of this study showed that the logistics integration, information sharing, trust, lean practice, and the relationship between hospital supplier integration and hospital performance were positively associated with hospital-supplier integration. In contrast, information technology and hospital size were not positively associated xv with hospital-supplier integration. In addition, the results also revealed that the healthcare in private hospitals was better than that of public hospitals. This study has several implications for both theory and practice in a hospital-supplier integration. The theoretical implications include developing a robust framework for a hospital-supplier integration and analysing its impact on hospital performance. Furthermore, one of the clear contributions of this study is the moderating role of lean practices between hospital-supplier integration and hospital performance. These are reasons for studying this topic in a developing country to gain more knowledge. In addition, this study examines the validity of the relational view of competitive advantage theory in Saudi Arabia. Moreover, the implications for practices are also far reaching and varied, as the sample comprises of two types of hospitals currently operating in Saudi Arabia: private, and public under the Ministry of Health. These implications include enabling managers and decision-makers to find the best practices to manage relationships with their suppliers, devising a system that enhances hospital performance through the adoption of the right level of lean practices in their hospitals, as well as reducing the overall cost by ultimately enhancing the management of materials and supplies.