Supply Chain Challenges in Pharmaceutical Manufacturing Companies: Using Qualitative System Dynamics Methodology

Document Type: Research article

Authors

1 Department of Pharmacoeconomics and Pharmaceutical Management, School of Pharmacy, Shahid Beheshti University of Medical Sciences, Tehran, Iran.

2 Department of Industrial Management, School of Management and Economics, Tarbiat Modares University, Tehran, Iran.

Abstract

In today’s competitive market environment, pharmaceutical companies have learned that improving supply chain performance is critical to maintain competitive advantages. Forecasting, planning, procurement, financing, stock levels, and marketing strategies are some of the areas in which managers have to decide about them and balance their enter-related effects simultaneously, to achieve organizational goals. This study is based on the results of literature review, experts’ opinion acquisition, and qualitative system dynamics modeling. So, according to method, triangular researches have been considered. The purpose of this research is to explore pharmaceutical supply chain (PSC) challenges and the dynamics behavior of variables playing a special role in PSC. Also, it provides different policies to overcome the challenges. For the first step to reach this goal, several semi-structured interviews with expert supply chain managers are conducted to explore the main challenges. Inaccuracy in forecasting, long lead times, lack of optimum target inventory, and high SC costs are the most important PSC problems. Then, qualitative system dynamics methodology is used to demonstrate the inter-relationship between variables that have impact on challenges. Finally, three strategic policies are recommended including: Collaborative relationship with suppliers, Investment in new technologies, and
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Information technology (IT) establishment. Consequently, the results can give PSC managers a comprehensive view for decision making and bringing their attention to the importance of feedback behavior of variables in long term and their effects on organizational decisions and goals.

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