Healthcare supply chain leaders are always looking for ways to push greater efficiencies and maximize the cost savings potential of their operations. The use of technology has become indispensable to that quest. Donna Van Vlerah, President of Supply Chain at Parkview Health, shared what she looks for in three technological solutions she calls her “nirvana”—a warehouse management system, a demand planning system, and a point-of-use system.
- Flexible workflows that allow nontechnicians to utilize the application to ensure extended supply chain visibility
- Volume metrics and containerization to optimize pick flows
- Embedded advanced transportation function to track product from point of departure to destination
- Product expiration, serial, and lot tracking
- Scalable to accommodate future expansion
- Real-time capture of historical demand data
- Ability to examine reorder and transportation time to factor in variability time has on getting products into the warehouse
- Automated generation of requisitions based on preconfigured supply sourcing to create predictability for standing orders
- Full visibility of inventory and statistical analysis to allow the department to run reports and produce metrics to help streamline operations
- Clinicians able to use items without having to place reorder requests to allow them to focus their efforts on taking care of patients
- Modeling functions to help hospitals meet the Joint Commission’s requirement of having 96 hours of stock on hand
- Expiration alerts to allow materials management to move stock from slow-moving locations to fast-moving locations
- Ability to select a product in a patient’s room, match it to the patient, and send a charge to revenue integrity.
Once these systems are in place, it is up to organizations to utilize newly available data. One area where data analytics is particularly helpful is demand forecasting. By examining dashboards provided by the system, Van Vlerah and her team are able to take advantage of improved visibility, which helps to predict item usage and prevent stockouts and over ordering.
Another way to use data analytics is in value analysis and onboarding of new products, especially if replacing existing products. With accurate usage information, Van Vlerah says, supply chain can enter negotiations with full knowledge of how much product has been used and what the anticipated needs will be. Likewise, usage analytics can reveal opportunities for standardization and expose when nonstandard items are being used.
Technology is an Enabler
According to Van Vlerah, effectively utilizing the above solutions can be the difference between an adequate supply chain and an exemplary one.
“Believe that technology is an enabler, and be disciplined with the methodology you establish,” Van Vlerah says. “Technology’s great, but, if you don’t use it well, it’s not going to help you.”
Parkview Health has capitalized on technology to achieve Six Sigma level status with less than 0.5% obsolescence due to expiration, and, by closing up leakage through the point-of-use system, Parkview Health has recaptured approximately $15 million a year in previously lost revenue.