Material management (or supply chain management) as it is now called) has been red hot for 27 years in healthcare, yet very few healthcare organizations have taken the time to develop a Strategic Supply Chain Operations Plan (SSCOP) to fine tune their multi-million dollar business operations.  Few healthcare organizations ever take the time to refresh their SSCOP plan if they have one to compensate for the winds of change that take place yearly and will affect their healthcare organization.

Winds of Change: Big changes will dramatically affect your healthcare organization is the economic melt down we are all experiencing. Your elective admissions are slowing, your investments have shrunk by double digits, your prices have escalated, your sources of credit lines are shrinking and your capital budgets are on life-support.  

Master Change: We in supply chain management always seem to be herky–jerky when it comes to strategic operational planning, when the fact is planning is the little known secret you desperately need to stay on top of your game.  By looking at where you have been, where you are now and where you want (or need) to be in 1, 2, 3 or 5 years with your supply chain management program, you can manage these unpredictable winds of change more effectively.

Anticipate Change: This is the situation with one of our clients whose management is telling him he needs to do more with less. He has responded to this challenge by developing a Supply Chain Operations Plan, with our assistance that includes reinventing and re-tooling his purchasing operations and supply value analysis program to be leaner, meaner and more productive.  As a result our client has proactively increasing his supply saving yield by 11.4 over the next few years. 

If you want to be left standing when the winds of change hit your healthcare organization, you need to master change by anticipating change with your own Strategic Supply Chain Operations Plan that will keep you afloat in good times and bad.

Your Partner In Savings Beyond Price™,

Robert T Yokl

Chief Value Strategist

Strategic Value Analysis® In Healthcare

Bobpres@strategicva.com

800-220-4274

P..S. Don’t wait until a crisis arises at your healthcare organization to create your Strategic Supply Chain Operations Plan. Be proactive, responsive and visionary by making planning a continual process of improving your supply chain each and every year so that you can master the winds of change.  

P.P.S. Don’t forget to check out my new blog article, “The Case for “Know-Nothing” Value Teams.  This blog will show you how to achieve better, unbiased decisions from your value analysis project managers every time.

This statement implies that in everything you are doing right now or thinking about doing for the future you must take a long-term view of how it aligns with your hospital, system or IDN’s long-term goals. Those goals are fueled by the uncertainty of the healthcare marketplace in the 21^st Century.

As an illustration, I’m seeing healthcare systems and even Alliances centralizing some or all of their financial services (payables, credit and collection, accounting, credit and collections, etc.) under their corporate umbrella to dramatically reduce their overhead cost. More than a few healthcare systems are replicating the WalMart model by vertically integrating all of their supply, processing and distribution operations as separate and free-standing new business entities.

These are long-term trends that have short-term implications for supply chain professionals who must start thinking and planning to move in this new and better strategic direction. For instance, if you are planning to upgrade and expand your current warehouse, as one of our clients is considering doing, you might want to think about building a shared services off-site warehouse with other hospitals in your region. This way you will be following the long-term trend of vertical integration today instead of locking yourself into a short-term strategy of building your own warehouse and absorbing all of these costs yourself.    

To summarize, what fuels the long-term supply chain management success is to always be looking over the horizon at the trends that are emerging in our marketplace, and then incorporate these lessons into your own strategic planning process so you are always thinking short-term with the long-term in mind.