Bolstering Competitive Advantage Through Supply Chain Efficiency

As patient consumerization continues to drive forward and healthcare adjusts to a evolving pandemic environment, hospital leaders are tasked with finding new ways of maintaining a competitive edge.

Efficiency is critical to achieving a sustainable competitive advantage, especially as competition is redefined and expanded beyond the hospital down the street—now including retail providers, online options, and other players looking to change the way consumers engage with healthcare. There's no better place to make improvements in efficiency than the hospital supply chain.

By looking for opportunities to enhance supply chain efficiency in acute care and outpatient settings, hospital leaders will be able to conserve resources, enhance the clinician experience and support positive outcomes for their patients.

The following strategies can be useful as you reimagine your supply chain.

Sharing Supply Chain Risk

Risk sharing is a foundational pillar to a supply chain strategy that improves competitive advantage. Hospitals function more smoothly with stakeholders aligned in producing outcomes. This is especially true as performance-based contracts place more responsibility on hospital leaders to improve outcomes and manage risk for both individuals and populations.

The challenge here is that these contracts pressure hospitals and health systems to shift their focus from working with manufacturers who lead on savings to those they can collaborate with to deliver improved outcomes. But this is an opportunity. Strategic relationships with vendors who are experienced in improving outcomes and have proven records of positive results in risk sharing can be incredibly valuable as competition continues to heat up. Look for vendors who are proactive, data-focused, and dedicated to improving resiliency in the supply chain.

Doing More With Your Supply Chain Data

The continued expansion of value-based care makes it critical to understand the total cost of care—which means supply chain data will be key to realizing your efficiency and competitive goals. This is because data is a competitive advantage. Or at least it should be.

Many hospitals and health systems are sitting on top of unrealized competitive potential in logistics management data and analytics. These included improvements like:

  • Tracking progress and success with customized benchmarks
  • Improving demand sensing and data ingestion
  • Understanding and maximizing opportunities to save
  • Identifying potential to increase efficiency in freight
  • Creating and implementing effective cost-reduction strategies

By melding the use of supply chain data with a team-based approach, you'll be able to better drive supplier compliance, track progress and continue to create personalized options as your performance improves and evolves.

To get here, your account management team should be proactively running and sharing reports, supporting analytics that reveal new ways to use the data you're generating in working toward your supply chain goals. Create a standard of collecting accurate data on utilization, outcomes and cost as you tear down the silos that might be keeping your key decision makers from contributing to your competitive efforts.

Coordinating With Your Patients

Patients are the driving force in this new era of supply chain management, which means hospitals and health systems have a new influencer to consider. Consider that ongoing threats to the hospital supply chain because of the COVID-19 pandemic continue to affect patient safety—a risk your patients are highly aware of.

Value-based care and population health initiatives will mean that providers need to track results and efficiency beyond the clinical visit. Staying competitive will mean working with your care community to address obstacles along the patient care journey. Your strategies, supplies and products will need to be carefully aligned with these efforts by curating your supply chain in a way that's tailored by specialty, disease category and specific patient needs.

Patients will see extended benefits from strategies that prioritize a resilient supply chain and that are integrated into a broader goal of improving competitive advantage.

Diving Into Value Analysis

As you explore new and alternative products to update the services you provide, you'll need to assess value.

Value-based care initiatives mean that your leadership will need a deep understanding not only of cost but also quality and outcomes of the products you use. To achieve this, you will need to take on an approach to value analysis that occurs at the system level. This approach will allow your teams to use data and collaborate with both clinical and operational leaders as you refine your processes to reduce variation and further improve outcomes.

“When supply chain leaders understand the total value provided by an item, process or decision, the change management process becomes easier. Educating the broader team on these sources of value further contributes to building a balanced and high-performing portfolio of products." - James Sembrot, senior vice president of U.S. supply chain at Cardinal Health

Look for opportunities to use supply chain insights to drive implementation and acquisition analysis.

You have multiple options available to increase your competitive advantage through improved supply chain management—but one of the most successful options is addressing how you allocate space and manage your inventory. To explore our Strategic Stock Solution and how it can support your supply chain goals, start here.

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