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Health systems looking to control costs while strengthening patient care often struggle to bring lasting change to hospital supply chains with complex requirements. When it comes to automated, point-of-use inventory management systems, there are several myths that often delay adoption for many organizations. However, these powerful solutions can revolutionize how inventory is managed, from seamless supply documentation and UDI capture to reductions in wasted time and effort.

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Exploratory data analysis for ORs is the first step – or the ‘scrubbing in’ – towards perioperative analytics for the supply chain.

The vast swathes of data being collected in modern health systems suggest that perioperative analytics (or OR analytics) are at the ready. The truth is that extracting meaningful information from all those data points takes some coordination and a little exploration. Let’s take a look at the exploratory data analysis that underscores analytics, and the different ‘flavors’ of perioperative analytics, from descriptive and diagnostic to predictive and prescriptive.

Imagine yourself in a situation where you are faced with the distress of having to undergo surgery to address an ailment. As a patient, what would be your top-of-mind concerns? You would think about how risky the operation is. How long the recovery will take. Which physician is going to perform the procedure. What the physician’s reputation is. And ultimately, what are your chances of healing from the underlying medical issue you’re getting the surgery for in the first place. That all makes sense. You are one patient facing one concern: your health and wellbeing.


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Male healthcare professional interacting with supply chain management software

 

Over the past 10 years, I’ve been working closely with leading healthcare organizations as they strive to improve their supply chain operations. So, I was intrigued to see a new AHRMM18 track this year focused on “Clinically Integrated Supply Chain” (or CISC).

 

During the event, supply chain directors, clinicians, and CEOs all addressed this enormous—and enormously important—subject and pushed the dialog forward from a multitude of different perspectives.

 

And therein lies the intrigue.

 

When addressing supply chain integration, we are inherently talking about connecting the traditionally disconnected, and it becomes a complicated—and often messy—state of affairs.


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Female healthcare professional posing for picture in clinicTransformation is a disruptive undertaking, but the risks and opportunities within the IDN Supply Chain warrant a closer look into a health system’s nextgen supply chain readiness.

 

Over the past few decades, a perfect storm has been brewing in healthcare. As M&A activity continues, consolidated healthcare systems are serving larger communities, managing bigger spends, and coordinating more complex business operations. It’s more essential than ever to render efficient health services while maintaining—or improving—patient outcomes.

 

One part of this ongoing complexity is exponential growth in the number of SKUs hospitals must manage. In fact, the number of individual supply items has mushroomed from a few thousand to upwards of 60,000—and that number grows every day.

 

The problem is that physical hospital space was never set up to handle this volume of product. In addition, clinicians do not typically receive training or education in supply chain best practice, and the negative ramifications on clinician efficiency, patient care, and cost control are becoming increasingly evident.


Determine your organizations’ readiness for supply chain transformation with the IDN Supply Chain Readiness tool.


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Hand stacking wooden blocks labeled with Clinical Supply Chain related images

It’s an interesting time in the healthcare industry, and for the supply chain specifically. Each of the following market factors is thrusting the supply chain to center stage and calling on all of us to up our game in the face of more complex operations. These factors include:

 

  • The advancement of new technology, from drones and robots to artificial intelligence and distributed ledgers
  • Increasing margin pressure
  • New and changing traceability regulations
  • Numerous mergers and acquisitions


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I was recently interviewed by Modern Material Handling for the article Health Care Embraces E-commerce Trends. In the article, it is clear that supply chain practices in healthcare have come a long way in the past five to ten years. Historically, the margins in this specialized industry have compensated for lack of advanced healthcare supply chain capabilities. Now, though, the industry is no longer standing still due to the increasing pressures on margins, traceability and customer demands.

 

Healthcare professional in hospital inventory room using healthcare supply chain management device and supply chain management software to find stock
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Image of empty operating room overlaid with healthcare cloud solutions software filterI recently wrote an article for Becker’s Hospital Review Health IT & CIO Report titled “Offloading IT Headaches to the Cloud is a Win for Healthcare”.

 

It is remarkable how far we have come in the last two years. If I would have written this article then, it might have been titled “Overcoming the Fear of Cloud in Healthcare”, because not too long ago, the benefits enabled by cloud technology were also shrouded in fears over perceived security risks; concerns such as “Where’s my data?“, “Can someone steal it?“, “How do I know it is safe?“. We have all heard and read the stories in the news. But clouds are secure (arguably even more secure than on-premise deployments) because they are deployed, monitored, and managed with security by design.


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Business leader showing employee how to use supply chain and business intelligence analytics softwareIn the January-March 2018 issue of APICS magazine, APICS CEO Abe Eshkenazi contends that if supply chain leaders bring business success then that makes them business leaders. Mr. Eshkenazi goes on to state “organizations that consider their supply chains as strategic and competitive assets outperform the market”.

 

Indeed, superior supply chain performance does drive business success in very measurable ways.  How can supply chain justify and measure process improvement initiatives using a metric that finance can relate to?  As cash management is a top priority for finance, sharing the Cash Conversion Cycle (CCC) metric allows supply chain and finance to speak a common language when measuring business success.


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Metallic globe on grass plane shaped as the infinity symbolThere has been a lot of focus on optimizing the supply chain for order fulfillment.  The on-going efforts to perfect the ‘order to cash’ process have yielded great rewards.  But what about returns?  Automation has reduced the number of returns due to errors however the world must move from a linear to a more circular economy and this will impact the entire supply chain.

 

The notions of a circular economy and green distribution are really quite wonderful.  Imagine an industry that produces no waste or pollution, and where products are designed for safe and non-intrusive disposal.  Imagine an industry where 100% of unconsumed or partly consumed products are returned for re-use.


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Bar graph demonstrating increase of access to useful data and effectiveness of at using insights

Source: MIT Sloan Management Review

In my last post, I introduced the longitudinal study that MIT Sloan Management Review has been conducting over the past five years. From 2010 to 2012 they indicated that 67% of those surveyed believed that analytics gave their organizations a competitive edge. In 2013, that figure stabilized at 66% revealing the so called ‘Moneyball Effect’ where leaders lost their competitive edge that they once enjoyed because followers matured and made analytics core competencies. In 2014, that trend continued, falling to 61%.

 

But why?


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