Supply chain management involves coordination of the activities of stakeholders in an industry including manufacturers, distributors and retailers. This ensures increased efficiency and thus the final consumer is a position to get a reasonable price for a good or service. Supply chain management has been introduced in various industries including the motor industry. Activities in the auto industry are highly coordinated where more than one supplier is involved and thus the manufacturer ensures that all parts are ready for assembly at the right time. However, supply chain management in the health care has lagged behind in many countries including in the United States.

There are several reasons that have been associated with the above phenomenon. One reason that has contributed to the above phenomenon is the lack of accountability among physicians. Physicians understand the efficiency of various drugs and other supplies and should go for the most cost effective choice. In most cases, the above does not compromise the treatment. Secondly, drugs are usually final products and thus hospitals are not in a position to ask suppliers for samples.

Moving ahead, it is imperative that supply chain management is introduced in the health care industry. After the global financial crisis, the cost of living escalated and thus more households are faced by increased budgetary constraints. Therefore, through supply chain management, health costs can be significantly reduced and thus improve the general welfare of the citizens. One of the measures that can be taken to introduce supply chain management in the health care industry is increased information sharing. Information sharing is especially critical where physicians remain central to the chain where they would look into efficient ways for combating various diseases. Additionally, more incentives should be introduced in order to ensure that more physicians remain innovative and come up with cost effective procedures.