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Supply Chain Management 

Management Approach 

The BDMS supply chain management is overseen by the BDMS Center Procurement Department, operating in accordance with strategies and policies reviewed by the BDMS Supply Chain and Resource Management Committee, is in charge of BDMS supply chain management. In addition, the department continuously collects data and reports to the Board of Directors to ensure efficient supply chain management with transparency, fairness, and accountability of the supply chain management process to all stakeholders. 

Board Responsibility in oversight of implementation of the supplier ESG programs  

The company has developed a sustainable supply chain management system through the Center Procurement process to enhance the efficiency of business operations while considering ESG impacts. The implementation of ESG into supply chain management is overseen by the Board of Directors to ensure responsible management, promoting consistent efficiency, transparency, fairness, and accountability for every stakeholder group. 

Moreover, BDMS introduces key strategies as the core factors for supply chain management by integrating sustainability materiality topics into the corporate supply chain criteria in line with the corporate mission and vision as follows 

1. Establish a centralized procurement system to consolidate procurement in all BDMS networks while enhancing value chain efficiency and utmost transparency in line with international regulations and standards as well as corporate strategies. Moreover, centralizing procurement data enables analysis and trend forecast, resulting in improvement and utmost efficiency in future procurement. 
2. Integrate sustainable procurement to achieve fair, honest, transparent and ethical business operations while adopting sustainability materiality into supplier selection and procurement criteria. Avoid purchasing goods and services from suppliers that violate human and intellectual property rights or conduct illegal activities  while actively mitigating environmental and social risks to ensure compliance with the Supplier Code of Conduct. 
3. Develop strategic supplier partnerships to foster on building collaborations with key suppliers to drive sustainable growth. With knowledge and experience sharing, BDMS is determined to build a sustainable value chain that minimizes environmental impact, benefits all stakeholders, and elevates Thailand’s healthcare system competitiveness. 

BDMS Sustainable Procurement 

BDMS ensures the accuracy, transparency, and trade confidentiality of the procurement process in compliance with all relevant regulations with the determination to encourage eco-friendly procurement per Sustainable Procurement Policy. To enhance the efficiency of BDMS value chain management, BDMS implements the processes as follows :  

1. Defining Product and Service Scope and Supplier Segmentation 

• Define product and service scopes into medical and non-medical based on essential factors in business operations. 
• Categorize suppliers according to business efficiency criteria and supply chain risks.  

2. New Supplier Registration 

• Evaluate suppliers based on Sustainable Procurement Policy and BDMS Supplier Code of Conduct. 
• Register new suppliers on Approved Vendor List (AVL), regularly revised and updated. 

3. Critical Supplier Identification 

• Establish supplier selection guidelines based on business, environmental, social, and governance criteria. 
• Identify critical suppliers based on business factors (spending volume), supply chain risk, and collaborative capability. 

4. Transparent and Eco-Friendly Procurement 

• Establish the Integrated Buying Team. 
• Conduct competitive bidding and value analysis for procurements above one million Baht. 
• Include ESG criteria in quotation and procurement process. 
• Foster green procurement, green label products and local product sourcing. 

5. Supplier Evaluation  

• Conduct systematic supplier audits and evaluations. 
• Continuously assess and monitor annual compliance. 

6. Supplier Relationship and Capability Development 

• Develop supplier capability development to ensure efficient procurement. 
• Devise supplier development plan to manage supply chain risks and continuously promote sustainability. 

BDMS Supplier Selection and Evaluation 

BDMS procures products and services from new and existing suppliers registered in the Approved Vendor List (AVL). All suppliers must undergo a selection and evaluation process based on the sustainability criteria in line with the BDMS Supplier Code of Conduct. Suppliers are excluded from contracting if they cannot achieve minimum ESG requirements within a set timeframe. Suppliers with better ESG performance are preferred by applying a minimum weight to ESG criteria in supplier selection and contract awarding. The suppliers are then categorized based on relevance using a supplier system related to BDMS business operations. When assessing the reference documents, BDMS evaluates by considering 2 factors:  

1. Sustainability Performance (ESG) following the corporate policy on  

• Sector-specific risks 
• country-specific risks 
• Commodity-specific risk 

2. Business Relevance for suppliers  

• spending volume (80% of the annual disbursement) 
• suppliers providing products and services for more than 10 hospitals. 
• suppliers providing irreplaceable products and services  
•  suppliers co-developing innovations with BDMS.  

BDMS continuously monitors supplier sustainability performance using the 2 key factors to identify critical suppliers and devise appropriate guidelines for sustainable supply chain management in the long term. 

Supplier selection process  

BDMS has established ESG requirements for its supplier selection process. Suppliers with better ESG performance are given preference in supplier selection and contract awarding. Additionally, the Company has imposed specified timeframe for supplier, who does not meet the criteria to improve their performance prior to the selection process. In case the supplier cannot meet those criteria, they will be excluded from the contraction.  

Pre-qualification process for supplier selection 

 The following are examples of minimum ESG requirements, but not limited to:  

• Compliance with business ethics policy and regulations 
• Adherence to labor laws and regulations 
• Conformance to occupational health and safety standards such as ISO 18001 or ISO 45001 
• Adherence to environmental standards such as ISO 14001 or Green Procurement 

In 2024, BDMS performed a supplier selection with the following results 

BDMS Supplier Screening and Evaluation Results in 2024 

Supplier Assessment 

BDMS performs supplier risk assessments with systematic verification of evidence following the international audit standards named Sedex Members Ethical Trade Audit (SMETA). The assessment corresponds with sustainability standards in terms of quality, delivery, technology and innovation, corporate governance, business ethics, internal and external social well-being, occupational health and safety, as well as environment performance. 

Supplier desk assessments  

Supplier desk assessments process ensures compliance with the BDMS Supplier Code of Conduct by evaluating critical suppliers following the corporate criteria and ranks the suppliers on a scale from A to F, where suppliers in D to F rating are required to complete a self-supplier risk assessment and evaluation process.  

Supplier on-site assessments  

BDMS Central Procurement (2^nd party) conducts supplier on-site assessment based on the supplier self-assessment documents where BDMS will support and provide the suppliers identified with significant negative actual and potential impact or high-risk suppliers (Score D) with corrective action plans. BDMS Central Procurement together with the suppliers will discuss and finalize corrective measures and monitors progress and provides suggestions to ensure compliance within one year. The process helps assess ESG performance, provide suggestions for efficient sustainable development and elevate the systematic collaborations in line with the BDMS Code of Conduct.  

In 2024, BDMS conducted supplier evaluations with the results as follows 

Example of  Risk Management Strategies the suppliers identified with significant negative actual and potential impact or high-risk suppliers and Mitigation Strategy (Corrective Action Plan) 2024  

Supplier Development  

Suppliers’ ESG peers benchmarking program  

In 2024, BDMS communicates the suppliers’ current sustainable supply chain performance, stating average, highest and lowest scores, compared with other competitors in the industry. Furthermore, BDMS identifies areas for improvement and develops corrective action plans for suppliers in D to F ratings which require efficiency improvements in sustainable supply chain management in quality, delivery, technology and innovation, corporate governance as well as internal and external social well-being aspects. The initiative aims to help suppliers understand their sustainable supply chain management when compared with industry competitors. 

The ESG benchmarking details supplier’s current performance in sustainability aspects compared to the average score, maximum score, and minimum score, as shown in the example picture below.