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KSR Publishing, Inc.
Copyright © 2008

People, Places, Processes & Products that Influence the Supply Chain

INSIDE THE CURRENT ISSUE

September 2008

Fast Foreward

Connect with this month's featured Advertisers:

Abbott Vascular
Advanced Sterilization Products
Alco Sales & Service Co.
Applied Logic, Inc.
Belimed
Broadlane Inc
Carstens
ChemDAQ Corp
Covidien
Cuno Inc.
Exergen Corp
Getinge
Healthmark
HLS MedFreight
IAHCSMM
Jani-King
Kimberly Clark  Professional
Kontrol Kube Mobile
Containment Solutions
Lionville Systems Inc.
Metrex Research Corp.
Orkin Exterminating Co
Resurgent Health and Medical
Rice Lake Weighing Systems
Ruhof Corporation
Sittris
Specialty Surgical Instrumentation
Spectrum Surgical
Instruments Corp.
Stericycle
TSK Products, Inc.
Uni-med
Winco

Awakening a looming fiscal giant

Whether anyone recognizes and acknowledges it, the seeds of healthcare supply chain harmonic convergence have been planted and are germinating. Expect a role reversal within 10 years.

Sure, that’s a long time to wait for the industry finally to wake up and realize the vast importance of supply chain management within the entire healthcare system, but rest assured it’s coming. Mark my words: Supply chain management will be a C-suite-occupying, executive-level professional function by 2018. And it will be as remarkable and as refreshing a transformation as the healthcare industry’s relatively rapid acceptance but slowly growing adoption and implementation of the GS1 Healthcare U.S. standards after decades of procrastination and rebuffing similar efforts.

Why? Priorities. In fact, a series of events are propelling supply chain management to the fiscal and operational, as well as executive, front lines. Here are some of the signs.

u A growing number of industry "outsiders" are entering the profession. And rather than scurrying away kicking and screaming when they see how convoluted the healthcare system is compared to, say, any other industry, they’re sticking around and making changes. Not only are professionals from outside of the healthcare industry, either from the purchasing ranks or not, now running supply chain operations at a number of hospitals and systems, but a growing number of professionals from outside of a hospital’s or system’s supply chain ranks are now running supply chain departments or areas within those departments.

u The GS1 Healthcare US standard seems to have gained a solid entrenchment – ranging from sincere curiosity to legitimate enthusiasm and engagement. What’s noteworthy is that it emerged from outside of healthcare along a similar timeline of professionals moving in. Intriguing.

u The ongoing development of a performance measurement tool, SCMetrix, finally will provide the C-suite with an effective mechanism to evaluate supply chain management as a significant chunk of its clinical, fiscal and operational health. One challenge is that the C-suite has yet to recognize, accept and adopt this tool as a performance measurement benchmark and link it to compensation. Another challenge is that if universally accepted and adopted it will weed out the coasting, fly-under-the-radar, just-holding-out-until-I-retire players earlier than expected. Arguably, that’s a good thing. But many seasoned veterans, beaten down by politics and a needlessly overcomplicated system, still retain some innovative ideas, compassion and experience for the job.

u Jamie Kowalski’s long-running "healthcare executive survey on supply chain management," now sponsored by distributor Owens & Minor Inc. with the latest results unveiled at the annual AHRMM conference in San Antonio in late July, wisely predicts that supply chain-related costs eventually will represent the largest slice of a healthcare organization’s expense pie.

It’s not hard to see how and why. Do the math. More people are living longer, making them more susceptible to disease from their fluctuating environments (personal habits versus community progress), brought on by technological development. Meanwhile, technology is advancing faster than organizations can use it economically, effectively and efficiently, and most products now are costing more than they ever have, due to a variety of geopolitically driven, hysterically motivated, resource scares.

Connect the dots. The influx of outsiders disrupts the status-quo mindset, enabling the infiltration of industry standards and performance measures that will bring fiscal transparency and reliable and valid data to the equation at a time when rampant consumption of products and services emerges as the norm.

Bottom line: This is a good time to be in healthcare supply chain management even if you doubt the worth in wait. So stick around. The storm clouds are starting to dissipate as the status quo storm front shifts.