Supply chain costs account for a surprisingly high percentage of the overall total operating budget at healthcare facilities, making clear insight into supply chain processes critical to ensuring maximum efficiency and long-term cost savings.
To help improve supply chain proficiency, many organizations are turning to robust supply chain management (SCM) solutions. The best SCM solutions utilize sophisticated software and systems that can help improve effectiveness, streamline and optimize critical business processes and significantly enhance an organization's bottom line.
Understanding the advantages for implementing and utilizing supply chain management software is essential for decision-makers at hospitals and other healthcare institutions. The healthcare supply chain is complex, and evolving compliance and certification issues continue to add to that complexity.
Advantages
Proactive sourcing
A practical SCM solution will allow organizations to facilitate a proactive sourcing strategy. Instead of dealing with just one particular manufacturer or product, hospitals could do a better job of analyzing requirements, assessing available options and comparing vendors and manufacturers – ultimately leading to better and more informed decisions.
Inventory controls
SCM solutions allow hospitals to achieve the twin goals of achieving both leaner and smarter inventory, reducing waste and unwanted shortages. Significant SCM-driven cost savings can be realized through a vendor-managed inventory approach, where a product might be sitting on the shelf at the hospital, but the hospital does not pay for it until it is actually utilized. This reduces the operational/capital expenditures and lowers the carrying costs of having that inventory on your shelf.
Advanced analytics
SCM can also make a tremendous impact in the analytical realm of supply chain performance. Using business intelligence components and more sophisticated reporting, healthcare organizations can quickly and definitively answer questions like: “What’s our spend?” “What’s our average days of inventory sitting on the shelf?” and “Can that be reduced?”
Best Practices
Even the most robust SCM solutions are not entirely autonomous and require organizations to have a certain level of knowledge of the pain points they are looking to address through SCM software. Below are a few best practices to help ensure your organization gets the most out of its SCM system.
Get the right product/system
This may seem obvious, but it is surprising how often an organization chooses to work with a system that simply does not address all of its needs. Find the SCM solution with all the required functionality embedded in it.
Work with an “implementer”
Secure the services of an expert or experts who specialize in implementing those processes and making supply chain optimization “enhancements” to the system, based on their knowledge of the software and their real-world experience with other healthcare institutions. Some hospitals are not realizing their full supply chain optimization potential because they are setting up systems without a complete understanding of the features available to them. An expert will be able to identify shortcomings and provide solutions for optimizing your system.
Train and educate
Knowledge transfer and change management is an important piece of the puzzle. Working hand in hand with personnel on the ground is critical to success. There are also a number of new electronic tools designed to help end users walk through the process independently, and hospitals should work with a vendor who provides significant support and technical/procedural assistance on an ongoing basis.
SCM solutions have the potential to be game-changers for hospitals and other healthcare facilities looking to cut costs and do more with less. The enhanced level of clarity into internal processes will not only improve your organization’s bottom line, but will also provide more insight into critical business processes that ultimately lead to better decision making capabilities.