While the implementation of an integrated Supply Chain Management (SCM) solution provides state-of-the-art capabilities to support critical cost saving efforts, we have found that implementing the solution in and of itself does not automatically achieve the performance improvement and business operational/process objectives typically predicted. There is typically minimal Return on Investment (ROI) from the implementation of a new management information system. However, there is a significant ROI if the solution is implemented in the context of operational best practices and thoughtful integration to the organization’s Surgery Information System (SIS) and Charge Description Master (CDM).
Key Takeaways:

  1. Structural consideration to support value proposition to the community
  2. Understanding of the key drivers for near-term and long-term Return on Investment
  3. Common challenges and what it will take to resolve them

The Issue
Much has been written about healthcare SCM best practices and healthcare organizations’ experiences. Key characteristics include the internal and external collaboratio, lead time reduction initiatives, tighter feedback from customer and department demand, customer level (department) forecasting, and even optimal integration. But what is typically overlooked is the SIS and CDM integration.
Most healthcare organizations recognize the importance of SCM to the organization. And, most leverage vendor and implementation toolkits, experience, and best practice models provided for the solution. However, few organizations pay particular attention to the organization’s “legacy” practices and culture. These often challenge (or limit) the real-time touch points of SCM and both the SIS and the CDM.
Typical SCM implementation methodologies and healthcare best practices have traditionally been rooted in three fundamental healthcare tenets to leverage advanced and enabling technologies:

  • Risk mitigation and aversion
  • Vision and planning from beginning to end
  • Client ownership

Most organizations that have implemented a SCM solution with a leading Enterprise Resource Planning (ERP) solution have jumped right into the many interactive design, build, and test workshop recommendations. Organizations have given staff the opportunity to become engaged and to become part of the “new” electronic processes enabled by the solution. The opportunity to challenge, understand why, and not just blindly accept recommendations has often demonstrated significant positive outcomes. By collaborating on the solution, staff were not only offered a better understanding of the hospital’s SCM processes, but were more often likely to embrace it. As internal subject matter experts and leaders within the organization, they leveraged change-agent activities to foster positive end-user adoption among their peers. While the foundation of the implementation may have been the best in the world, its effectiveness continues to be only as good as the degree that the all staff embrace it and use it properly.
The reality is that an organization’s supply chain is only as strong as each linked system. With a complete and integrated solution (SCM, SIS, and CDM), organizations can fully automate the procure-to-pay process of supplies, capital assets, and process patient care items from scheduled procedure all the way to patient charge. A complete and integrated solution allows the organization to spend less time on administration and more time on securing and monitoring suppliers, negotiating competitive pricing, and forging strategic alliances.
Envision a scenario where pressing the Enter key on a hospital computer sets into motion a series of coordinated processes that reaches across the entire healthcare supply chain and completes the following:

  • Chooses products for the patient standardized to the (ICD-9 or 10) procedure codes
  • Assesses the need for backup contingency supplies and product options based on physician product preference and historical data
  • Picks the supplies appropriate for that individual case and groups those supplies with all other supplies needed for preparation, recovery, and follow up
  • Verifies the latest contract price and verifies synchronized pricing accuracy among all supply chain stakeholders
  • Determines whether there is a need to replenish supplies either at on-site stock locations or in the off-site warehouses of a distribution partner
  • Aggregates the product replenishment requirements and automatically places an order
  • Communicates usage data to the manufacturer and other stakeholders for predicting future demand

A hospital can do this by reviewing the best practices enabled by their systems and exploring the full features their SCM, SIS, and Perioperative that support the inter-related business processes, e.g., ward admission, anesthesia, surgery, and recovery. These practices should be reviewed with a goal of providing better conditions for patients before, during, and after operations. This process will point a hospital to further understand the need to:

  • Leverage an optimal integration strategy to fully understand the process and application capability for process change management, project management, application expertise, end user education, data cleanse needs, and report writing requirements.
  • Fully understand lessons learned, include the following:
    • Corporate-wide standardization of workflow processes, design decisions to support best practices, best use of SIS, data and clinical documentation standardization, testing, and development of end-user training programs are critical
    • Addressing the individual hospital level use of software policies, procedures, setup guides, decision making workshops, test plans, test scripts, training guides, etc. that have been developed are necessary.

An interoperability model enables a hospital leverage all the current and diverse systems and data—including information captured from clinical, financial, and operational sources. The simple act of scheduling a routine medical procedure can activate an automated process that leverages the best of both the SCM and the SIS. Those hospitals that have successfully integrated these systems have done so with Service-Oriented Architecture (SOA) integration strategy. SOA, when applied holistically throughout an organization, enables the clinical business drivers to sustain improvements in business performance (e.g., reducing redundant data, passing key data from one system to the next, supporting cross department workflows) and pushes departments to implement best practices to deliver more value at lower cost.