September 20

Planning to Win in the Hospital Supply Chain Game


I always find the job of planning to be boring, while at the same time stimulating and thought provoking because it forces me to think long-term about our challenges and opportunities one, three, or even five years out. I do this exercise every year around the holidays because our business slows down a bit, even though I could think of dozens of fun things I could be doing in the holiday season. 

Yet, I discipline myself to do so every year for a few days, since I know that planning is the only way to win in the hospital supply chain game. I start by looking at my statistics (sales, savings, profits, losses, etc.) for this year vs. last year. I then look at the trends over the last five or six years to make sure we are going in the right direction.

You should be looking at your trends too, year over year, for the last few years. For example, are your GPO savings growing, flattening, or deteriorating? Is your hospital’s official inventory shrinking or getting larger, and by what percent? Is your value analysis savings — beyond price — keeping pace with inflation? What was your cost avoidance savings this year vs. last year? What was your labor turnover rate last year vs. the national average? You get the idea?

With this information in hand, you can start to develop a picture of the health of your supply chain operations and start to formulate a plan to correct any and all deficiencies that you have uncovered. For instance, at most hospitals, systems, and IDNs, their GPO savings have been flattening or deteriorating over the last few years, so this challenge needs to be addressed — not ignored! I can tell you that most hospitals are turning the faucet on wider with their utilization savings to compensate for losses in their GPO savings that you should also be considering. 

What I have just described is a mini lesson on how to get started with your own planning to win in the hospital supply chain game. As I mentioned, I spend days in my planning sessions with my staff analyzing the environment we live and work in while looking for threats to overcome and opportunities to capitalize on. This is the foundation of all planning exercises!

Yes, planning is hard boring work, but the payoffs are huge for you and me if we take our planning seriously. It keeps your healthcare supply chain organization from becoming complacent, comfortable, and reactive vs. proactive. Most importantly, planning provides you with the strategies, tactics, and techniques to overcome any threat or take advantage of any opportunity that is on the horizon. Don’t start the new year without it!

Articles you may like:

What Does It Take to Be In the Top 5% In Healthcare Supply Chain Expense Management?

3 Rules for Hospital Value Analysis Team Peak Performance

Drive Your Hospital’s Supply Expense Savings Higher Without Leaving Your Desk

Request Demo of SVAH’s Value Analysis and Utilization Tools


GPO savings, healthcare supply chain, hospital supply chain, supply chain, supply chain organization, supply chain planning, value analysis

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