The Healthcare Industry In Thailand

Published Date: 02 Nov 2017

These days, the Internet is paying a decisive role in every part of business for the purpose of increasing work productivity, maximizing communication capacity, and facilitating business transactions and so on. In compliance with ‘Thailand vision towards a knowledge-based economy’, many industries including healthcare industry have become increasingly responsive to the contributions of IT in term of E-procurement technology as an effective way for improving business performance. Hence, this study is focused on investigating critical success factors (CSFs) affecting the implementation of E-procurement in Healthcare Industry. It was found that the five factors that had the highest degree of influence on the success of E-procurement including top management support, performance measurement, system security, system training and education and risk identification and management.

Introduction

Over the past ten years, the Thai government has endorsed a national policy framework for information technology (IT) implementation which officially known as ‘Thailand vision towards a knowledge-based economy’ (Laosethakul, 2005). This policy framework views IT as major factor for realizing the continuous development of knowledge-based economy and society in Thailand. Consequently, many industries including healthcare industry have become increasingly responsive to the contributions of IT in term of E-procurement technology as an effective way for improving business performance. In Thailand, the immeasurable endeavors have been allocated for implementing the E-procurement systems in healthcare sectors (Leelayouthayotin, 2004). However, Rotchanakitumnuai and Speece (2007) pointed out that that very little attempt has been made to explore the factors affecting the successful implementation of E-procurement in healthcare sectors in Thailand. Hence, this study is focused on investigating critical success factors (CSFs) affecting the implementation of E-procurement in Healthcare Industry. The findings of this study will benefit the SMEs by providing critical information to management to assist in deciding whether its business should strategically invest for IT or not. This will help to propel the Thai healthcare sector to a new level of business success.

1.2 Objectives of the study

The major objective of this study is given as follows:

To incorporate the factors that critical to the E-procurement implementation and evaluate their influences on the success of implementation in perspective of healthcare industry in Thailand.

1.3 Research questions

In this research, the research questions of this study are given as below:

What are the factors that can affect the success of implementation of E-procurement among healthcare organizations in Thailand?

What is the degree of influence that each factor has the success of implementation of E-procurement among healthcare organizations in Thailand?

2. Literature review

2.1 Definition of E-procurement system

Based on review of relevant literature, there are a variety of E-procurement’s definitions introduced by a number of research scholars and practitioners (Puschmann and Alt, 2005; Vaidya et al., 2006; Yu et al., 2008). As for this research, the E-procurement was described as the utilization of information technology (IT) to develop Internet-based purchasing systems that facilitate electronic purchasing process between companies and suppliers or companioned and customers which resulting in operational efficiencies and potential cost savings.

2.2 The major contributions of E-procurement systems in business sector

According to Chaffy et al. (2000) and Jobber (2004), the major contributions of the use of E-procurement systems in business sector could be summarized henceforth. In optimistic views, it has been proved that the costs associated with buying or selling activities have considerably been decreased as operational costs are reduced. In particular, prices are quoted in more transparent manner, the buying and purchasing that happen outside of the company practices are avoided, the preferred supplier networks are chosen to work with, and power between buyer and seller is appropriately balanced. E-procurement systems also assist the company to improve its supply chain management via establishment of more efficient integration of supply chains which contributing to better work arrangement, effective transaction records for easier data acquisition (Chen et al., 2003; Chen and Tan, 2004; Dooley and Purchase, 2006). Moreover, the systems can facilitate the company to improve the ordering and purchasing process and payments facilitation and promote the better relationship among company, the customers and sellers by providing web-based FAQ and auto-feedback, and so forth. Due to faster exchanges of information and delivery of products and services, E-procurement systems also provide shorter product-development cycles to the companies.

2.3 Factors affecting success of the implementation of E-Procurement

Based on extensive review of relevant literature (Thong, 1999; Corbitt, 2000; Afuah and Tucci, 2001; Duffy and Dale, 2002; Georgiou and Stefaneas, 2002; Heung, 2003; Wen et al., 2003; Yao, 2004; Batenburg, 2007), it can be summarized that the factors which can affect the successful implementation of E-procurement systems in business sector can be discussed as follows:

2.3.1 Top management support

Georgiou and Stefaneas (2002) and Gunasekaran and Ngai (2008) underlined that the success of this business effort requires the commitment of top management towards setting up realistic objectives, allocating required resources, mandating the use of E-procurement systems, promoting the appropriate work culture, regarding this project as top priority and so on.

Sound implementation strategy

As Moon (2005) described, every company should develop the clear procurement objectives, identify detailed steps of procurement process, and prioritize them. The output of these activities will be an effective implementation strategy which regarded as major contributor for successful E-procurement (Jutla et al., 1999; MacManus, 2002).

2.3.3 Risk identification and management

To ensure the successful E-procurement, risk identification and management should be invested for managing uncertainties and developing strategies to manage risks (Pavlou and Mendel, 2006; Panda and Sahu, 2011). For example, company evaluates whether or not it has an appropriate resources for implementing E-procurement systems.

2.3.4 Process reengineering

It is important that the company should redesign the procurement functions and processes so as to facilitate E-procurement systems (Presutti, 2003). The inefficient functions must be eliminated while compulsory processes must be optimized for implementing the systems.

2.3.5 Technology standard

Since the E-procurement system will be carried out with collaboration with other business systems, it is imperative that the system should be developed in compliance with acceptable technical, process and procedural standards (Rajkumar, 2001; Heung, 2003; Quayle, 2005).

2.3.6 System security

To ensure the successful E-procurement systems, security controls (e.g., the managerial, technical and operational countermeasures) which arranged for protecting the confidentiality, integrity, and availability of the system and its information should be put in place (Roth, 2001; Reddick, 2004; Croom and Brandon, 2007).

2.3.7 System Integration

To be successful, it is essential that the E-procurement systems should be integrated with other IT systems (e.g., financial systems). It is also very important that the required information should be shared in real-time basis across the systems (Turban et al., 2004; Teo et al., 2009).

2.3.8 Change management

As Wen et al. (2003) and Yao (2004) noted, an effective change management plan should be established in order to achieve the success of E-procurement systems, for example, providing training for stakeholders to get accustomed with the systems or setting up the help desk systems or online help, etc.

2.3.9 Performance measurement

For guaranteeing that E-procurement systems would provide ultimate outcomes, it is significant that the system objectives are clearly communicated, measurement of performance accomplishment undertaken in compliance with the stated objectives (Yen and Ng, 2003; Teo et al., 2009).

6.10 System training

As Laudon and Traver (2004) described, the success of E-procurement systems is highly contributed by the appropriate provisions of training for involved stakeholders. The training can enhance the ability of every included individuals and parties to deal with the systems in quality manner (Barnes and Vidgen, 2002; Angeles and Nath, 2005).

3. Research conceptual framework

Figure 3 Research conceptual framework

This study was carried out by using the research conceptual framework as demonstrated in the Figure 2. It can be seen that there are ten factors which considered as the critical success factors of E-procurement implementation in healthcare sector in Thailand. This framework provides the clear direction for creating the methodology of this study developing research tool, designing data collection method, indentifying sample-size and sampling technique and selecting data analysis method.

4. Research methodology

To collect the required data, the structured questionnaire was selected. In particular, the required data about the degree of influence of the ten factors critical to successful implementation of E-procurement systems will be collected from the respondents who randomly selected from healthcare organizations in Thailand by using five-point’s Likert scale. The scale was designed with range of 1 (very low influence) to 5 (very high influence). In the aftermath of data collection process, the gathered data was used to perform descriptive analysis to generate findings and conclusions. The findings and conclusions were generated by taking the stated objectives into an account. More to the points, research questions were answered through the examination of gathered data. In this study, the sample size of 30 respondents from 30 healthcare organizations who randomly selected based on convenient sampling was asked to fill the questionnaire. The sample included IT managers, purchasing manager, IT Engineers and purchasing representatives.

Figure 2 Proposed research methodology

6. Findings

To ensure business success, E-procurement systems have been given significant consideration. In order to effectively gain maximum outcomes, factors that positively influence the implementation need to be investigated. The findings retrieved from the questionnaire survey were demonstrated in the following table.

Table 1 Respondents’ perceptions towards the degree influence of Critical Success Factors (CSFs)

Critical Success Factor

Mean score of degree of influence on the success of E-procurement systems (n=30)

Interpretation

Rank

Top management support

4.63

very highly influential

1

Sound implementation strategy

3.83

highly influential

9

Risk identification and management

4.10

highly influential

5

Process reengineering

3.70

highly influential

10

Technology standard

4.03

highly influential

6

System security

4.33

highly influential

3

System integration

3.90

highly influential

8

Change management

4.00

highly influential

7

Performance measurement

4.50

highly influential

2

System training and education

4.30

highly influential

4

Remark: Mean scores of importance between 1.00 - 1.50, 1.51 - 2.50, 2.51 - 3.50, 3.51 - 4.50, and 4.51-5.00 are interpreted as not influential at all, little influential, moderately influential, highly influential, and very highly influential.

Referred to Table 1, It was found that the top management support was the most influential factor (mean = 4.63) in achieving the success of E-procurement, which currently implemented in healthcare sector followed by Performance measurement (mean = 4.50), System security (mean = 4.33), System training and education (mean = 4.30) and Risk identification and management (mean = 4.30)

7. Conclusions

These days, the immeasurable endeavors have been allocated for implementing the E-procurement systems in healthcare sectors However, very little attempt has been made to explore the success of E-procurement systems. Based on the findings, it can be summarized that the success was mainly characterized by top management support sector followed by Performance measurement (mean = 4.50), System security (mean = 4.33), System training and education (mean = 4.30) and Risk identification and management (mean = 4.10). The results of this study can assist Thai healthcare organization by providing critical information to management to assist in deciding whether their business should strategically invest for IT or not. This will help driving the Thai healthcare industry to reach a new level of business success. For further research, this study could be broadened to include a larger sample size to increase the level of reliability of the research. More advanced statistical analysis should be applied in order to get insight into the data.

8. Ethical issues

The following ethical issues were highly addressed in this study.

Confidentiality: The confidentiality of participated respondents was protected. They will not be harmed by their involvements in this study.

Honesty and trust: The facts and information gathered from the study were not distorted.