When thinking of ways to reduce costs, improve efficiency and incorporate data into processes, three words come to mind: supply chain management. Healthcare supply chain management involves obtaining resources, managing supplies, and delivering goods and services to providers and patients. In an interview with Arab Health Magazine, David Ford, Founder and Director, Ingenica Solutions, highlights that improvement in supply chain processes help healthcare organisations achieve long-term financial and operational efficiencies and contribute to better patient safety. Excerpts from the interview.
Why do organisations undertake healthcare supply chain programmes or initiatives? What are the benefits?
The internal supply chain of a healthcare organisation is often a silent service that can be dependent on various clinical departments manning and managing the processes separately and not in a systematic approach; often it is reliant on certain individuals as an addendum to their other duties.
Supply chain management remains an issue across the healthcare sector and undertaking programmes or initiatives that support transformation provides an opportunity to improve efficiencies at a critical time; helping healthcare organisations cut costs, implement smarter processes and deliver better patient care.
UK hospitals, for instance, are under huge pressure to transform outdated, flawed approaches to managing procurement and supply chain operations, which are often manual approaches that are not fit for today’s healthcare environment.
The cost of supplies, for example, is a significant part of expenditure so improving the way in which its inventory is acquired, stored and managed within a supply chain is critical to operational and financial improvement, and sustainability.
Improvement in supply chain processes helps healthcare organisations achieve long-term financial and operational efficiencies and contribute to better patient safety. An example of this is tracking and tracing medical supplies throughout the supply chain, such as high-value implants, from point of manufacture to point of care; allowing organisations to build a picture of usage – who, what, where and when products are used on patients.
Benefits are wide and a few examples include:
- Financial benefits
- Reduces stock obsolescence and wastage
- Reduces spend
- Enables patient-level costing/service line reporting
- Non-financial benefits
- Enables data-driven decision-making
- Greater control and visibility of the supply chain
- Improves patient safety
- Identifies expired stock
- Enables product safety recall
- Enables reorganisation of storage space
- Auto-replenishment of stock
- Reduces stock-outs
Healthcare organisations are increasingly adopting innovative technology to improve procurement and supply chain processes, options that do not negatively impact clinical staffing levels or quality of care but instead facilitate better ways of working.
Taking our technology as an example, Ingenica Solutions 360 IM is configurable across multiple areas with different processes; the benefit of this is that it allows healthcare organisations to use just one solution to achieve procurement and supply chain excellence.
A best practice example of a healthcare organisation that has adopted an initiative to improve supply chain operations is Royal Cornwall Hospitals NHS Trust (RCHT) in the UK; also, one of our customers. It is one of the six selected as the UK Department of Health’s Scan4Safety demonstrator sites for the adoption of GS1 and PEPPOL standards and leads the way in adopting smarter and more effective systems and practices to improve procurement and supply chain processes, and patient safety.
The Trust uses Ingenica Solutions 360 IM for the inventory management element of the Scan4Safety programme; using GS1 barcoding to track and trace products and supplies, from receipt to point of use with patients.
The benefits of a good inventory management system were not widely understood in the NHS, but Scan4Safety is the lever that has enabled RCHT to demonstrate that inventory management is key. For RCHT, the first step in the Scan4Safety programme was to get control of its inventory in order to improve patient safety, data accuracy and operational efficiency.
Today, by using unique identification numbers, RCHT can identify every person, product and place ensuring that staff can match the right patient, the right product, in the right place from delivery of an order to point of care.
What are the challenges to the implementation of successful healthcare supply chain initiatives?
The healthcare environment is highly challenging. Broadly speaking, healthcare has fallen behind other industries in terms of supply chain management, and in the UK, in particular, has used basic, manual and time-consuming technologies or approaches in the past.
To improve its procurement and supply chain practices, data is key. It also poses a key challenge; to improve data quality, access to data and facilitate better data analysis.
In the UK, many NHS trusts do not have access to robust data, as they have no reliable electronic stock or inventory management system; so, data can prove a big challenge to implementation. Outdated systems are unsuitable to meet the challenges and demands of today’s modern hospital and lead to significant problems.
Another key challenge is the people. Implementation of healthcare supply chain initiatives is fundamentally a change management project, often underpinned by technology, which needs to win hearts and minds. Engagement of people in these programmes can be a challenge.
To what extent is the degree of collaboration among healthcare supply chain participants (manufacturers, suppliers, GPOs, distributors, providers)?
It is really important that all components of the supply chain are aware of their responsibilities and part in the complete supply chain. In the UK, the main issue that is being addressed in the use of a common data set so that the systems in use across the supply chain can share data and information easily. The GS1 programme in the UK demonstrates that at the end of the point of care, a unique ID across the supply chain is imperative.
The projects that we undertake in the NHS often highlight excellent internal collaboration; demonstrating how different teams work together to choose and manage products cost-effectively in the short and long term. Our projects bring different functions across a healthcare organisation together such as managers, clinicians, ICT, finance, and procurement; successful projects require collaborative engagement across all these departments.
Will blockchain have an impact on the healthcare supply chain?
Yes, we believe blockchain has huge potential in the healthcare market. There is a lot of noise about blockchain in healthcare and we can see why as it enables lots of records to be kept and linked but also encrypted. Where we are looking to share patient records and information across systems, blockchain looks like an incredibly powerful enabler – even Amazon updates the products being dispatched for that patient, along with the details of the delivery drone.
