Momentum amid disruption—how collaboration with customers drives supply chain resiliency

Awareness of the benefits of oral and medical care integration is growing. But implementing it will present some challenges, not only among providers, but patients too.

Sponsored: Cardinal Health- November 2023- The Journal of Healthcare Contracting

In the seemingly endless journey on the path to stability, healthcare supply chains continue to be challenged by disruptions. Material shortages, transport delays and rising input costs are still overwhelming organizations around the country. While some amount of supply issues and disruptions may be inevitable, it doesn’t make them any less challenging to accurately predict. And though immediate effects like backorders on key products are felt acutely, longer-term effects on supply chain can be harder to see and fully understand.

Mitigating disruptions and reaching supply chain stability requires organizations to be adaptable and resilient. Resiliency, a word commonly heard throughout many facilities, is the ability to prepare and respond to the unexpected. For healthcare organizations, responding to the unexpected means acting with speed. But quickly adjusting, let alone transforming, a massive operation like a health system is a major challenge due to the sheer number of quickly moving parts and competing priorities at play.

When healthcare works seamlessly, patients are likely to have better outcomes, and organizations drive value. The supply chain stability that enables seamless operation requires heightened collaboration between health systems, distributors, and manufacturers, as well as between the clinical and supply chain teams within an organization.

Transparency builds trust

Operating one of the largest dedicated laboratory distribution networks, Cardinal Health™ focuses on facilitating collaboration between healthcare providers, purchasing organizations, supply chain teams, suppliers and manufacturers by maintaining a customer-focused approach. 24 of Gartner’s top 25 supply chain health systems are Cardinal Health lab customers.

“Distribution is the connective tissue across the continuum of care,” said Emily Berlin, Vice President Laboratory Marketing & Aero-Med Commercial Sales and Operations. “Because a supply chain is only as strong as its weakest link, it is important for us to foster relationships that enable supplier and customer resiliency.”

For Cardinal Health, stability and resiliency is achieved with a collaborative approach built on a foundation of transparency and shared focus. In an unpredictable landscape, being able to consistently respond with speed is possible when distributors and healthcare providers act with deliberate intent and in tight alignment. This level of collaboration requires trust, trust that is built through a history of listening to customers and responding to their needs.

“We are focused on being healthcare’s most trusted partner. Trust is earned through transparency and consistently delivering on our commitments to our lab customers.” Berlin stated.

Operating with transparency means sharing what success looks like and communicating clearly on how both parties will achieve that success together. Maintaining this approach for decades has led to Cardinal Health lab customers citing accuracy of shipment, ease of placing orders, and timeliness of deliveries as key factors behind the value they receive by doing business with Cardinal Health.1 Additionally, Cardinal Health continues to enhance service levels and communication to help ensure the right product arrives at the right place at the right time. The Health Industry Resilience Collaborative (HIRC) recently awarded Cardinal Health the HIRC Transparency Partner Badge for commitment to supply chain transparency and resiliency.

For distributors, it is also critical to develop trust with suppliers. Cardinal Health is dedicated to building engagement and stronger relationships for mutual growth, holding regular meetings with suppliers to discuss shortages and identify solutions. Regular communication and sharing of data enable the alignment needed to deliver on commitments to mutual customers.

Berlin stated, “Patients count on our customers, and our customers count on us. Collaboration is key to developing a healthy supplier ecosystem.”

Collaboration + technology = visibility

Having options and the ability to determine when those options are needed helps mitigate variability. Visibility across functions, both upstream and downstream, makes it easier for leaders to draw insights and enhance planning to reduce waste and other inefficiencies. Bringing cross-functional teams together to ensure that vital products are available and review contingency plans with customers and suppliers helps reduce variability and uncertainty.

Technology goes a long way to improving visibility. Cardinal Health has invested in physical infrastructure, integrated inventory management solutions, and advanced visibility solutions including FourKites® real-time supply chain visibility platform that enables greater connectivity with carriers across the supply chain, Kinaxis® Rapid Response software for digital supply chain planning and end-to-end visibility across the network, and new distribution capacity that includes autonomous mobile robots (AMRs) for increased safety, service, quality and efficiency.

Cardinal Health also offers services designed specifically to help clinical labs better prepare for unpredictability and drive value. These include regular product availability updates, the Reserved Inventory Program that helps ensure dedicated inventory of respiratory testing items, and customized solutions like patient-collected sample kits that help organizations standardize workflows and operate more efficiently.

Keeping the momentum

Momentum arises from velocity and quantity of matter. It is the domino effect of success. Small successes cascade throughout the chain to create bigger successes – communication leads to collaboration, which enables resiliency, stability, and a steady path forward for healthcare organizations.

“Our focus is clear: maintaining the momentum we have built to move healthcare forward and drive inefficiencies out of the healthcare system,” Berlin said. “What we do matters to customers.”

1 Cardinal Health data on file – Voice of customer survey, April 2023

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