Application of a purchasing portfolio model to define medicine purchasing strategies: An empirical study

Abstract

In recent decades, the purchasing function has occupied an essential role in managing companies in all industries. In healthcare, purchasing medicines is critical due to the amount of resources involved, the quantity and wide variety of items purchased, and the impact on the quality of health service. This research aims to propose a more efficient and effective practitioner-wise model for medicine purchasing strategic management in the healthcare industry. For such, this study combined action research with a case study to develop a Purchasing Portfolio Model based on the Kraljic Purchasing Matrix in the context of a central hospital. Analytic Hierarchy Process techniques were used for criteria prioritization and direct measurement to score each criterion. Multi-Dimensional Scaling was used to position the items in the quadrants of the Kraljic Purchasing Matrix. The Purchasing Portfolio Models developed allows the classification of different classes of medicine in terms of strategic impact and supply risk, enabling the development of differentiated purchasing strategies. The results confirmed the model's value in defining medicine purchasing strategies in a central hospital and provided guidelines for applying the model.