Three tips to alleviate ongoing supply chain struggles
COVID-19 has caused major disruptions to the global supply chain, and the healthcare industry is no exception. According to a recent survey of hospital and health system executives, more than 85% of organizations have faced shortages of key items as well as significant price increases of supplies since the pandemic began.
It’s clear that healthcare organizations of all sizes need to reevaluate their supply chain strategies to safeguard against the unknown. Consider these three tips to maintain adequate inventory and organizational resilience:
Engage an array of internal partners
As you examine and reformulate your supply chain management strategies, bring a diverse group of colleagues to the table, including supply chain, finance, nursing and physician leadership. These conversations will help define a comprehensive plan for ensuring your organization receives the products and equipment it needs—and how it can be achieved.
Amid shortages of critical supplies at the beginning of the pandemic, companies manufacturing everything from pool noodles to whiskey pivoted to masks and hand sanitizer. While these businesses produced desperately needed supplies, these examples illustrate the value and importance of clinical input in purchasing decisions, as those with the proper expertise can confirm that supplies meet your organization’s clinical standards.
Beyond verifying the quality of supplies, clinical leaders can also work with those in supply chain and finance to save on costs. Let’s say your organization is currently buying several different types of gloves. After consulting clinicians on the glove types and manufacturers they prefer (and which gloves are collecting dust in stockrooms), there may be an opportunity to buy higher quantities of fewer glove types from fewer suppliers—opening the door for negotiating lower prices.
Standardize your data
Standardizing data across your organization is integral to successfully managing the supply chain, and case costing is one way to generate useful insights. Case costing offers the potential to forecast budgets, identify variances and highlight areas for cost savings. You can also determine cost per surgeon and cost per procedure with case costing. Gathering this information enables you to see variations in spending across multiple users (in this case, clinicians). For example, perhaps two physicians from the same specialty use very different amounts of a particular item per patient case. If you are tracking the data, you can look for those trends and identify opportunities to cut down on supply usage where possible and clinically appropriate.
Similarly, using a Preference Card Analyzer can help you examine expenditures with greater context. Preference cards list all the supplies a surgeon needs to successfully perform a procedure. When unneeded items are kept on a preference card, this creates waste—either from a team member spending time bringing supplies back to the stockroom, or simply discarding those supplies. With a Preference Card Analyzer, an organization can assess if the right quantity of a particular item is actually being used and leverage this information to make future purchases. (Here’s a recent Allscripts blog that discusses the importance of using Preference Card Analyzers in the perioperative department.)
Formulate backup plans before they are needed
Traditionally, many healthcare organizations have employed “just-in-time” (JIT) inventory management. With a JIT strategy, organizations count on manufacturers to deliver the right supplies in the right quantity at the right time to avoid eating the cost of storing surplus goods. Given the current supply chain issues, the JIT model has become less reliable.
As a result, some bigger hospitals and health systems have created large warehouses to stockpile supplies to ensure access to necessary goods. While this may create short-term benefits, managing expiration dates becomes critical to avoid unnecessary waste. Other organizations are finding success with purchasing groups, which pull volumes together from multiple organizations to get better pricing tiers with suppliers. Like individual healthcare organizations, as the purchasing group generates more data on supplies ordered and consumed, it can leverage that data to negotiate better pricing with suppliers.
If these solutions are not viable for your organization, identify and begin forming relationships with secondary vendors. That way you can quickly turn to alternative options in the event of an emergency. Select vendors with geographic diversity to minimize the chances of your suppliers all facing the same disruption, such as delays at a port, at the same time.
No matter the changes a healthcare organization navigates—pandemic surges, expansions, or mergers and acquisitions—these strategies enable more accurate forecasts and prudent buying decisions. Is your organization looking to streamline its supply chain? Learn how Allscripts® Enterprise Resource Planning (ERP) Solutions can help at https://www.allscripts.com/solution/enterprise-resource-planning/.
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