Experts Views on Healthcare Supply Chain Strategies www.healthcaresupplychainme.com
A STUDY BY Q1 What are the latest trends that you are seeing in how organisations are managing healthcare supply chain functions? Dr Nipit Pirajev, CEO, Bangkok Healthcare GCC healthcare systems are facing the new environment of fully implemented universal health insurance. The presence of third party payers will rapidly shift the balance of influence and decision making from provider driven to a more complex provider-payer-regulator-patient multistakeholder model. This can lead to a fragmented, zero sum and unsustainable system unless collaboration and accountability across the value chain are brought into play soon enough. The volume-based care model will soon to be replaced with the value-based model. Healthcare supply chain management (HSCM) is certainly one critical function at the centre of this transition. Never before are patient safety, health outcome and customer experience plus system financial sustainability taken more seriously as performance indicators for health suppliers and vendors as well as the hospital procurement team instead of just belonging to the front line clinical teams. So the latest focus on HSCM is that low cost alone is not enough; the cost factor must be weighed against medical quality and patient outcome. To achieve this, integration, collaboration and in some cases consolidation, both internally and externally across the healthcare value chain, is key. Fahad Al Melafekh, Supply Chain Responsiveness Project Expert, King Faisal Specialist Hospital and Research Centre Supply chain usually represents the second highest operating cost after labour, fluctuating from 33% to 50% of the full operating budget in healthcare. The GCC healthcare leaders have just realised the importance of such functions where more focus on improving Supply Chain business processes could foster more benefits to the organisation. Thus there is recognition to the importance of linking the medical and the business sides to collaborate with each other, and technology is needed. The concept of e-health has lately rose where healthcare and the patient-related process are to be linked through electronically delivered information. However, there are more to come to maturity. The sessions were very professional and collaborative towards moving supply chain in the right direction. Jimmy Johsnson, Director Supply Chain Management, John Hopkins Hospital, USA
Karima Ajhar Hakim, Procurement and Materials Director, Bellevue Medical Center Increasing the need and the viguor to improve on operational performance through enhancing and maximising process efficiency. Driving cost out of operations and reducing expenses within the supply chain process as a result of economic and healthcare reforms through operations streamlining. Becoming more judicious with the resources that we steward. Having a comprehensive database and identifying what is the needed information to ensure effective planning and execution within the chain. Ensuring the balance and the harmony between quality improvement and the return on investment analysis at the procurement level. Considering the development of creative relationships with suppliers and health care providers as a market opportunity. Leveraging cross-organisational knowledge throughout the health care organisation to assure engagement. Excellent speakers and discussions. Nadie Abdullah Najib Principal Admin Officer, DHA, UAE Stefan Sickel, General Manager, Group Pharmacy Procurement, Mediclinic Supply chain function is becoming more involved in business operations for them to get a complete understanding of what they are purchasing and for what reason. This allows supply chain managers to make better decisions in the procurement process. Supply chain functions are being centralised to allow for central procurement, pricing and negotiation control in large organisations. Information technology is playing a much larger role in terms of online purchasing, processes, sourcing and communication. Incorporation of a complete B2B process, automated procure-to-pay process Samer Ellahham, Chief Quality Officer, Sheikh Khalifa Medical City Supply Chain is a part of the C-suite and is being involved in strategic projects across the healthcare organisation. Major focus on validated, accurate, and well communicated data, which adds value. Supply Chain is key to the standardisation of care by determining the best price and the best outcomes and minimising waste. Clinically integrated supply chain, where supply chain professionals and clinicians work closely and side by side. Supply Chain based on long-term, mutually beneficial relationships between trading partners. Q2 What are your top 3 tips for driving value and eliminating operational inefficiency in the healthcare supply chain? Once again, current gaps in healthcare value and efficiency are the result of the highly fragmented system driven by zero-sum relationships. Some of the top strategies include: (a) Establishing alignment among healthcare value creating teams from the clinical, admin and supplier levels across healthcare continuum. (b) Adopting evidence based practices, from clinical to business. (c) Integrating clinical, financial and general management functions. (d) Combining wellness with illness management at both individual and population levels. (e) Implementing connected information management system across value chain. As for healthcare Supply Chain in the GCC, I don t think we need to reinvent the wheel. In fact, many proven best practices are there to be implemented. The only issue is how applicable are these best practices to the GCC healthcare market dynamics and how it should be modified and implemented. Agility to reduce cost and increase flexibility through lean and efficient processes. Measurement and benchmarking to drive continuous improvement through supply chain costs and capabilities. Economic and clinical value analysis of supply chain processes. a. Focusing on product planning and forecasting especially in the UAE market. b. Aligning the supply chain and operations of the business for better decision making. c. The use of highly effective tools like six sigma and lean mapping to ensure an efficient process.
Q3 Is there a lack of talent in the field of healthcare supply chain management in the region? Dr. Nipit Pirajev: It is fair to say that globally HSCM has been a relatively neglected function. It is usually led by a manager without direct presence in the C-suite and with a general admin type of team that is quite disconnected from the clinical and front line ones. So, lack of talent is a common issue in most markets. The first step toward building up more capacity is to highlight HSCM as a critical function with re-positioning HSCM team to work hand in hand with all front line operations. Demand for healthcare supply chain talent is rapidly increasing, and talent resources can t cope with this increase. Raising the talent bar is a persistent initiative to achieve optimisation, and thus raising the workforce talent even higher is essential to focus on leading edge challenges and solutions. The talent is certainly available but in a young and volatile market it is important that all the stakeholders in the supply chain align and communicate better to improve the overall maturity of the system. Samer Ellahham: The region has plenty of talent. Organisations should learn from international experiences and appreciate the local needs. Excellent dialogue and sharing of experiences and best practices. Clendon Raines, Senior Director Supply Chain, International Medical Centre, KSA Q4 Which key performance indicators do you utilise to monitor suppliers effectively in the GCC? The shift from traditional volume-based healthcare towards value-based healthcare model will also change the way suppliers are assessed and rewarded. The performance measures include three groups of KPIs, namely safety, outcome (medical, financial, satisfaction) and cost (in this case, non-labour related expenses). Each group consists of a number of indicators relevant to the healthcare context from macro to micro levels, and for short, middle and long term measurement. Two important points here (1) bringing all relevant stakeholders on-board before actual implementation, (2) HSCM decision is not the end point but the starting of continuing assessment process to measure the outcome for future improvement. Supplier s on time or lead time variability Supplier s fill rate Accounts payable days Supplier s retention of inventory in time and value Percentage of order compliance Compliance with contract terms and conditions Service level Product price Product quality Stock availability Product range Competent and friendly staff This depends on the organisation's strategy and focus which in healthcare runs around four main attributes: reliability; responsiveness; agility; and cost. But the prioritisation and focus is different.
Q5 Which demand planning, forecasting and inventory management strategies are you implementing to mitigate the risk of critical stocks outs? There is no doubt that in any complex hospital and healthcare environment, a fully integrated hospital information system (clinical and non-clinical; EMR and ERP) as well as a close-to-real time, closed-loop operational automation system are critical tools for achieving the balanced quality and efficiency HSCM goals. The occurrence and scale of demand uncertainty in the GCC is high, which has created an enormous need to establish collaborative supply chain activities among its network. Partners need to cautiously plan the order throughout the system. They should decide together where, when, and in what amounts the inventories should be available. They have to set up the response system for when unexpected events arise. Therefore, collaborative planning will be a part of the partners tactical and strategic plans to achieve the maximum process efficiency. Stock management automated system for increased visibility Integrated planning and forecasting Contracts management with suppliers Safety stock based on daily product usage and product lead time with suppliers Efficient collaboration, communication and defining accountability Continuous performance assessment, tracking and auditing Tenders (including annual and multiyear forecasts and purchase commitments) Establish and maintain excellent supplier relations and communication Establishment and implementation of alternate procurement models and import routes when stock outs occur ERP system reports (IT) for planning Par level system (in-house) 2-bin system (in-house) Informative, a good platform to share the knowledge and experience among attendees. Mohammad Kamal Khan, Materials Controller, Sheikh Khalifa Medical City, UAE Q6 You are speaking at the Healthcare Supply Chain Strategies Forum. How important is your topic to HSCM transformation for improved patient outcomes in the GCC and why would you recommend that your peers attend the Forum? I will be speaking on Inventory and material management best practice at the Forum. Healthcare supply chain is a complex system involving the production, distribution and storage (outside and inside a care delivery unit) of thousands of products and services to be consumed via complex healthcare processes driven by multi-disciplinary healthcare professionals and that will finally create direct impact on patient safety, health outcome and cost of patients-providers-payers. Effective management of healthcare supply chain is just impossible without relevant information or data sets made available to providers, suppliers and payers, in accurate and timely manner as well as across the care continuum of the patients. This has been the greatest challenge in HSCM for long time. But with an advanced information and communication system, multi-dimensional data can be easily and/or automatically captured from target healthcare process or transaction along any clinical workflow. Then, a new generation of powerful analytics can process the captured big data to generate meaningful information for management decisions and/or to trigger clinical-operational-business automated responses. Health information and communication technology (H-ICT) will surely become the key enabling tool for integrating HSCM with the rest of healthcare management functions to realise value-based healthcare. It is my great pleasure to be a part of this exciting event and would like to encourage others to come to learn from experts, share best practices and strengthen the GCC community of HSCM practitioners for future collaboration.
I will be speaking on supply chain master data management optimisation at the Forum. Being able to reach the level of perfect order is very challenging and Master Data Management Optimisation is the key for that. Being able to build a network and linkage for all healthcare related data will not just improve patient outcomes, but also will drive value to those organisations through streamlining supply chain processes and reducing errors. I will be speaking on procurement as an integral part of the supply chain. Procurement as a key role in supporting the delivery of quality, innovation, productivity and prevention. Value based purchasing whereas any purchasing practice is aimed at improving the value of the health care service where the value is a function of both quality and cost. Sustainability of the health care organisation through effective procurement to deliver immediate efficiency and productivity gain. Respond to challenges through quality procurement performance and recognise areas for improvement to ensure value for money is delivered through its procurement activity and partners. Clinical engagement in the procurement of medical devices and supplies to improve patient outcomes at reduced cost through clinical procurement review partnerships. Suppliers engagement channeling to collaborative procurement hubs reflecting significant differences in performance outcomes and processes. Identification of critical supplies and suppliers to mitigate risks of failure and to deliver quality care. Transparency through availability of data and information Review of procurement processes to be patient centered through a lean and efficient process. It is evident that health care supply chain is a highly evolving sector and the summit will be an ideal platform to have practitioners within this field come together to share successes and concerns. Synergy is highlighted since there is great power from people seeing possibilities in the face of adversity. We can pledge to move forward, hold ourselves accountable and form mastermind sessions to keep up with the merging logistics of supply chain. The summit can also provide opportunities to discuss challenges and discuss best practices by overseeing the future trends. We would be able to identify various programs and initiatives that can be implemented but moreover what organisational restructuring is needed to sustain supply chain efficiency based on tangible experiences within the countries in the area. I will be speaking on the evolution of supply chain models in the region and learning from developed markets. We are living in the UAE, a region that has a multitude of talent and expertise from all over the world. It includes professionals with vast experience in the healthcare supply chain from many different markets. Yet in reality we find ourselves in a nascent healthcare supply chain with constant stock-out situations and product shortages. Therefore, I will be addressing at the conference questions about how we can develop this supply chain and take its maturity to the level of first world countries and what they are doing differently. Samer Ellahham: I will be speaking on Supply chain and the C-Suite: managing the interface to achieve supply chain excellence at the Forum. Supply chains provide service to patients and consume money. The sector is currently facing unprecedented demands due to a number of factors like globalisation, changing consumer sentiment, digital transformation, market uncertainty, legacy systems, and limited talents. By managing supply chain interdependencies and adopting a full view of service and cost, supply chain executives can amplify their organisational scope and heighten their financial contribution. The C-Suite Interface is key here. As healthcare organisations look for ways to improve revenues and positively impact supply chain costs and working capital, their corporate leaders need to start thinking about the critical role that supply chain management plays in transforming their organisation s top line and bottom line. The C-Suite needs to gain real value through revenue improvement, cost reduction, working capital improvement, and risk mitigation as well as make long-term improvements in customer service and increased customer loyalty.
ABOUT #HealthSupply Our panel of experts will be elaborating on these topics as well as other key themes in the industry at the Healthcare Supply Chain Strategies on April 19-22. Please visit www.healthcaresupplychainme.com for more information. Who Will You Meet? DELEGATE BREAKDOWN 30% Supply Chain Directors/ Heads 20% Material Management Directors/Heads 15% Procurement Directors/ Heads 10% Operations Directors/Heads 10% CFOs 10% CIOs 5% Other END TO END SUPPLY CHAIN ATTENDANCE 50% 15% 15% 10% 5% 5% Healthcare Providers Distributors Manufacturers Technology Consultants Others Providers Gold Sponsors Silver Sponsor Exhibitor Supported By Certification From Media Partners