Ask hospital supply chain leaders where the next wave of value will come from, and most don’t point to price negotiations. They point to what’s still hidden.
“Hospitals are still managing 21st century clinical complexity with 20th century logistical visibility,” said Colin Baird, systems director of supply chain management at Robbinsdale, Minn.-based North Memorial Health. “The delta between those two realities is where the money, safety and labor relief are trapped.”
That gap — between what health systems are doing clinically and what they can actually see operationally — came up again and again in responses from supply chain leaders. Whether they were talking about AI, standardization or purchased services, the throughline was the same: Value is already there, but most organizations can’t fully see or govern it.
At Ventura, Calif.-based Community Memorial Healthcare, Michael Alfaro, director of materials management, said AI-enabled tools are helping surface contract leakage, utilization variation and forecasting issues earlier — but technology alone isn’t enough.
“The biggest opportunity to unlock value right now sits at the convergence of AI-enabled analytics, distributor strategy and disciplined GPO leverage,” he said. The differentiator, he added, is whether insights are actually aligned with how systems buy and commit.
Others said the more immediate opportunity lies in basic discipline. Don Barton, chief technical officer and director of supply chain management at Shelbyville, Ind.-based Major Health Partners, pointed to deeper standardization and data-driven decision-making to align clinical utilization, contracting and inventory.
At Omaha-based Nebraska Methodist Health System, Stan Smith, director of supply chain, emphasized physician alignment in product selection alongside process standardization, noting that eliminating nonvalue-added activities is essential to reducing unnecessary operational cost. Without that foundation, both suggested, more advanced strategies struggle to deliver meaningful returns.
Several leaders also pointed to physician preference areas as a persistent source of untapped value. Tony Bramer, director of supply chain operations at Edgewood, Ky.-based St. Elizabeth Healthcare, said integrating supply chain expertise into departments such as perioperative services and interventional radiology is critical, particularly when those areas manage their own supply processes.
Several executives suggested supply chain’s next value unlock is also organizational. At Hyannis, Mass.-based Cape Cod Healthcare, Supply Chain Director Kjellander Ray said the limiting factor isn’t data availability but the workforce’s ability to interpret it. As supply chains digitize, he said, “the ability to effectively consume and analyze data will be critical to building a resilient supply chain.” In that sense, talent and technical fluency are becoming just as important as contracting expertise.
For some, unlocking value also depends on how well supply chain data is connected to the rest of the enterprise. Jason Moulding, president and chief supply chain officer at Tacoma, Wash.-based MultiCare Health System, said integrating supply chain data with quality and financial data allows leaders to develop a more holistic view of operations and play a strategic role in execution.
Where leaders agreed most strongly was that value is no longer confined to medical supplies. Doug Johnson, vice president of supply chain at Oakland, Calif.-based Alameda Health System, said supply chain teams need to expand their scope to purchased services such as staffing, security, telecom and utilities — treating them “just like supplies.”
At San Angelo, Texas-based Shannon Health, Luke Martin, administrative director of supply chain management, pointed to nonlabor categories like IT infrastructure, OEM service agreements and pharmacy benefit management as some of the system’s largest current savings opportunities, underscoring how much value remains outside traditional supply spend.
Even small process failures can add up. At Coral Gables, Fla.-based Baptist Health South Florida, Juan Serrato, associate vice president of supply chain informatics, said inefficiencies often live outside formal systems — in invoice exceptions, missed discounts and offline communications. Bringing visibility to those workflows, he said, allowed his team to measure compliance and generate “millions of dollars of hard saving” through internal process improvement alone.
The opportunity isn’t theoretical. Supply chain leaders described value already sitting inside hospital operations — not waiting on new contracts or tools, but on better visibility and execution.
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