Posted by Cory Turner | August 5, 2021
A huge pain point for hospitals is the tangled mess of bolt-on supply chain technology systems and disjointed processes used for inventory management throughout their facilities. Perioperative is using one system, pharmacy another, med/surg yet another and these systems cannot share data with one another. Within a health system, a supply chain leader may find the operating room (OR) in one hospital is using a completely different point of use (POU) system than all of the other hospitals in the network.
Disparate supply chain technology breeds complexity and waste resulting in a lack of inventory visibility across the entire organization. Leaders can’t effectively or efficiently manage supplies, track their movement, and prevent stockouts and expired items. This problem has plagued healthcare for decades, resulting in substantial – and unnecessary – costs.
As indicated in a Mercy case study, it has been estimated that hospitals spend about $25.7B more a year on supply chain than necessary. When you ask supply chain leaders about their challenges, they will acknowledge the issues they face, but their hands have been tied by supply chain technology limitations and the inability to access meaningful data on which to make decisions.
This is changing as the role of supply chain technology has been elevated in healthcare organizations. The move to value-based care and payments, industry efforts such as the AHRMM Cost, Quality and Outcomes (CQO) Movement, and the COVID-19 pandemic have all shined the spotlight on the role that supplies play in clinical and financial outcomes. As a result, supply chain leaders are taking their place at the C-suite table and being empowered to play a strategic role in the future viability of their organizations.
As supply chain shifts from reactive responses to supply issues, to strategic and proactive oversight and management of the flow of supplies throughout their health systems, they require supply chain technology with a much higher level of sophistication. Piecemeal data from dozens of different supply cabinets, POU platforms, stickers and spreadsheets patched together in an Excel spreadsheet just isn’t going to cut it.
As integrated delivery networks (IDNs) acquire more and more hospitals and other healthcare facilities, a holistic approach to supply chain management is even more critical to success.
To move the needle on costs and outcomes across the health system, a chief procurement officer or vice president of supply chain requires inventory visibility on the health system level and accurate and timely analytics at their fingertips.
There is widespread movement to detox unnecessary systems and processes for inventory management by moving to a single, consolidated supply chain technology platform for management of ALL supplies in ALL clinical areas. A holistic platform can track all categories of supplies from the moment they enter an organization to the time they are consumed. This includes the most expensive items – those used in perioperative space and pharmaceuticals – that fall outside of the scope of an enterprise resource planning (ERP) system.
Modern, digital solutions for supply chain management eliminate unnecessary systems, streamline processes and deliver immediate insights that supply chain leaders need to make evidence-based decisions. They help bridge the gaps and pave the path to supply chain greatness in the healthcare industry.
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