The pressure is on to find new ways to increase supply chain savings in the new healthcare economy. Business as usual is no longer good enough, and even time-honored, price and standardization strategies may not be enough to keep your healthcare organization in the black in these changing times. That’s why proactive healthcare organizations are adopting optimization-based savings strategies, practices and tools to uncover even more hidden treasures in their supply streams.
This has come about because complex, daunting and transactional MMIS and ERP systems lack the sophistication and nimbleness to dig and drill down sufficiently into your supply streams to uncover these golden nuggets. Three areas in particular have been the source of these new hidden treasures: (1) spend management, (2) utilization management, and (3) demand management. When properly implemented these new optimized savings sources can improve your hospital, system or IDN’s bottom line by as much as 7% to 15%.
Case in Point: Enloe Medical Center, a 298-bed hospital in Chico, California, has optimized their spend, utilization and demand management with an offline dashboard that employs value analysis analytics to uncover all of their price, standardization, utilization misalignments and spikes in their usage patterns. This has saved them $3,045,226. Prior to adopting this optimization tool, Enloe relied almost solely on their GPO contracts to generate all or most of their supply chain savings in any given year. Now that Enloe has more than one savings source to data mine, they are discovering endless opportunities to maximize their supply chain savings.
The reality today is that optimization technologies can maximize your supply chain savings if you adopt more sophisticated approaches in your supply chain practices. With the right technologies, metrics and analytics you will have the ability to analyze your customer’s buying habits, utilization patterns and over-spends. This will provide you with the strategic and tactical direction needed to reduce, manage and then control your hospital, system or IDNs multi-million dollar supply spend.
Robert T. Yokl
Chief Value Strategist
Strategic Value Analysis® in Healthcare