What are some of the areas of common ground we think that public procurement professionals have with supply chain managers for healthcare institutions? Let's dig in:
Creating Proactive Procurement Organizations
I posted an infographic on the fact that the World Health Organization found that 4 in 10 leading causes of inefficiencies in the health sector are procurement-related. All procurement shops, if not designed for proactive management, will come under pressure from the demand for goods and services, with quality outcomes, and in a regulatory framework. There are lessons learned on how to create operational frameworks from procurement and set expectations on what can be done at quality, and where tradeoffs will harm quality.
Managing Regulatory Complexity
Strict regulations in public healthcare supply that ensure patient safety, ethical conduct, & privacy. Whether it’s corporate compliance, HIPAA, cybersecurity, or legal concerns, there always are going to be additional hoops to jump through outside of simply executing contracts for the best value. Understanding how to execute effective sourcing events that result in compliant contracts is key to efficiency and effectiveness.
Proactive Data Management
How do sourcing managers in health care analyze, plan and control the purchase of goods and services?
The "item master" is standard infrastructure in healthcare operations – the centralized database that tracks everything from item descriptions and vendor details to pricing and contract terms. But without a repeatable management strategy to keep that information up to date, an outdated item master can lead to errors in order processing, missed contract compliance, and create unnecessary spending. Discrepancies can stack up, and then you overpay for supplies and lose the analysis capacity that comes from good data. A well-run system of record isn’t just a nice-to-have; it’s a must to keep the supply chain running smoothly.
Category Management and Strategic Sourcing
The diverse range of medical products and services, varying from pharmaceuticals to specialized equipment, we need tailored sourcing strategies that meet strict quality, safety, and compliance standards. Additionally, aligning multiple stakeholders with differing priorities complicates decision-making. Clear category definitions based on repeatable taxonomy is core to proactive spend management.
Inventory Replenishment
Throwing out useful supplies is something no one wants to do. The University of California, San Francisco Medical Center conducted a study tracking the waste during neurosurgery operations in the US in just one year. The discarded supplies topped $ 2.9 million. Implementing methods and systems to establish appropriate inventory levels, and establishing contract relationships that ensure the correct supply levels without waste or over-purchasing are key to cost management.
Crisis Management & Supply Chain Resilience
Recent events like the Covid years and other high impact medical crises require considering how to establish contracts that will withstand disruptions. Examples of key topics are a strong approach to vendor performance to maximize our supplier base, improve or eliminate poor performers, and considering what-if scenarios that can be embedded into terms and conditions and evaluation scoring. These directly support the role our healthcare supply practitioners have in protecting the public and the health of our communities.
The 2024 AHRMM show in Columbus, Ohio was a great opportunity to compare notes with health care supply chain professionals on these topics and more.
