March 14

3 Reasons KPIs Can Save You Time, Money, and Resources


It’s human nature that we are all looking for shortcuts, alternatives, or workarounds to make our jobs easier, not harder. Well, we are here to tell you that employing key performance indicators (KPIs) in supply chain is one surefire way to save time, money, and resources by:

How KPIs Save You Time, Money, and Resources

1. Focusing On the Right Things: Supply chain professionals have hundreds of labor and non-labor activities to keep their eyes on to be successful. However, it is impossible to see all and hear all without employing KPIs to provide you with the supply chain radar to measure, monitor, and manage those things that will make you successful. For example, establishing a KPI that represents the number of emergency requests/par level to determine if you have the right products or quantities on your par level systems.

2. Never Missing a Savings Again: We have documented that healthcare organizations are missing millions of dollars in savings, beyond price and standardization, that they are unaware of since they don’t have KPIs to pinpoint where those savings are hidden in their supply streams. For example, a hospital client of ours saved $176,000 in bone cement in one year by targeting this category of purchase because a comparative KPI showed that they were out of step with their peer cohort with their utilization of cement.

3. Optimizing Your Resources: With the labor shortages that healthcare organizations are experiencing in all departments, especially nursing, you want to make sure that your labor component is in line with your peers. The best way to do so is to establish labor KPIs for all of your supply chain function’s performance. With budgets getting tighter and tighter, you want to have a tool that will tell you and your CFO that your supply chain operations were all within acceptable limits, or when exactly you need additional resources based on patient volume centric metrics.

KPIs Make Your Supply Chain Job Easier

Supply chain organizations are becoming much more aware that by utilizing KPIs to measure, monitor, and manage the labor and non-labor components of their operations they can become more efficient, effective, and productive in all areas of their functions. Why not take the elevator vs. the steps when it comes to managing your supply chain operations? This is analogous to how KPIs can make your supply chain job much, much easier!

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cost management, healthcare supply chain, Healthcare Value Analysis, hospital supply chain, Hospital Value Analysis, key performance indicators, kpi, KPIs, standardization, supply chain, supply utilization

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