Yokl: Rethink Your Supply Chain Technology Model

I think my firm has a unique window into supply chain management of the future since it’s our job is to solve technology challenges for our clients. What we are seeing is that our clients are trying to seamlessly tie in all of their corporate entities into one supply chain technology platform for the purpose of communications, collaboration and productivity. Though, what they are discovering is that their MMIS and ERP systems aren’t user friendly, flexible and nimble enough in the new healthcare environment.

Why is this important?  Prior to approval of the signing of the ObamaCare legislation it was the conventional wisdom that a healthcare organization’s physician practices, clinics, urgent centers, rehab centers, etc. were tangential to the success of a healthcare organization and too often left to do their own thing.  But now that the screws are being turned on reimbursement from all sources (and the advent of Accountable Care Organizations) these alternate care sites have taken on a new importance in the healthcare economy. No longer can they be loosely aligned with their parent or moderately fiscally controlled if a hospital, system or IDN is to survive and thrive in the future.

Case in Point: One of our clients owns a hospital, plus eight other corporate healthcare entities but none of their alternate care sites are tied into their hospital’s MMIS system since it is too unwieldy, inflexible and complicated to use. Even when our client tried to have a shared supply catalog on their corporation’s internet it has been a time consuming chore due to their MMIS system’s quirks.  One solution to this challenge that we proposed was for our client to develop and then deploy a web-based supply chain portal to provide the linkage between their MMIS system and their alternate care sites for purchasing, catalog, bidding, etc. This would be invisible to their corporate entities, but flawless in its execution.

My point here is that all supply chain managers need to rethink their technology model as they look to their supply chain of the future.  Just the other day, I read in the Journal of Healthcare Contracting that Novant Health’s 350 clinics are utilizing a supply chain portal with great success for the purchasing at their clinics.  Tony Johnson, Sr. Vice President, Supply Chain, says in this same article that “With ERP, the clinics were used to associating product with numbers”. If they didn’t know the number they couldn’t find the product, which was frustrating. “Today, if they want needles, they say, ‘I want needles’, and the clinic sees a list of needles available and the price of each.”  It’s quick, it’s easy and almost full proof to order anything that the Novant clinics require!

As Johnson suggests, the secret to consolidating all of your alternate care sites under one supply chain system is to rethink and then redesign your technology model to be quick, easy and intuitive (just like Amazon.com ) so your alternate care customers will want to use it. Then, and only then, will you acquire the necessary control over these corporate entities’ purchasing that is required for success in the new healthcare economy.

Robert T. Yokl

Chief Value Strategist

Strategic Value Analysis® in Healthcare


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