Tapping your ERP for healthcare supply chain resiliency

The healthcare supply chain is under enormous pressure.

Ongoing disruptions and workforce challenges have supply chain teams dealing with product shortages and chasing backorders. Add to this inflation, canceled procedures and inefficient labor utilization.

In a December webinar hosted by Becker's Hospital Review and sponsored by Premier, Jeremy Padmos, vice president for enterprise resource planning solutions, and Matt Shimshock, vice president for supply chain technology, both of Premier, shared insights into how an enterprise resource planning system (ERP) can harness data for better risk mitigation, visibility and supply chain resiliency. 

Four key takeaways were:

1.) Healthcare CEOs say the major issues they face have changed dramatically over the last few years, shifting to workforce and supply shortages. In 2019, supply and workforce shortages didn't even register as a CEO concern, according to Premier's annual CEO survey. But they were the top concerns in 2022. Supply chain issues are not new: a complicated regulatory environment, the vast international supply chain, drug shortages and an increasing variety of SKUs have all added to supply chain management complexity. Inflationary pressures have compounded these challenges. 

In addition, healthcare organizations' IT systems are aging, with technical debt, security vulnerabilities and lack of integration, all of which lead to inefficiencies in a fraught financial environment. This means that healthcare leaders need investments that will pay dividends quickly, Mr. Padmos said. "Investments have to give them the priority to generate returns or savings on the portfolio right now to address the problems they face," he said.

2.) One often-overlooked investment that can yield that return is the existing enterprise resource planning (ERP) system. An organization's existing ERP contains reams of little-used data that can support supply chain resiliency for health systems. For example, outcomes data and practitioner usage can be combined with cost data to help address clinical variation. Automation can drive labor efficiency by digitizing the procurement process for efficiency. The ERP can even be used to leverage data management for forecasting and predictive modeling.

3.) Visibility is keenly important to a supply chain resiliency program. Currently, supply chain visibility is often limited and inconsistent, from the manufacturer to an item’s point of use by a clinician on the front lines. "There's a lot of opportunity when we start to look at accurate forecasting and demand planning," Mr. Shimshock said. "The industry desperately needs longitudinal visibility." 

4.) Premier is launching a new, artificial intelligence-based resiliency platform to provide better visibility. This solution allows health systems to harness the power of their ERP's data by using AI to help forecast shortages and back-orders. It works by giving provider organizations enough time to calibrate supply chain efforts by providing advanced information gathered from an ERP's many data points. "We're focusing on resiliency, having a strong ERP dataset, a strong ERP system that's built for healthcare, along with a resiliency program and analytics to help," Mr. Shimshock said. "That is critical going into the future."

Healthcare executives don't need another dashboard. They need actionable information. With Premier's PINC AI™ solution, health systems can identify the right supply chain strategies to predict, measure and solve for their supply chain shortages.

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