Supply chain ‘too big to fail’

Looking backward, Lynn Britton remembered a pivotal meeting he had with his CEO more than a decade earlier with such vivid clarity as if it were yesterday. He stuck his neck out and took a bold risk, a huge risk – but not a gamble, which relied on chance, fate, kismet or simply calculated guesswork.

Britton, a materials management director at the time, had to convince a C-suite full of decision makers that the way to steer their organization in the right financial direction was to implement a supply chain management project before the more favored and popular revenue cycle management solution.

With conviction and passion, he deftly argued his case, emphasizing that he truly believed it would work – it was a viable solution or "tip of the spear" – even though it seemed "countercultural" to the organization.

Then Britton did the unthinkable, which turned out to be the closer that over time would catapult his career. He told the group that if the supply chain management project had "an adverse effect, you can fire me" and make an example of him. He didn’t expect any severance either. And he had just turned 40 with a young family.

At the poker table, this might be classified as calling one’s bluff, regardless of the hand you’re holding because you either have a nerve-racking hunch as to what suits your opponent is holding or you can spot his emotional fragility and aversion to risk. But that’s gambling. This wasn’t.

"I wanted them to get it, that passion and energy was there," Britton recalled during the late April Webinar, "Supply Chain: A Chief Executive Opportunity," co-sponsored by the Association for Healthcare Resource & Materials Management and Healthcare Purchasing News. "With that kind of risk, you gotta be bold. You can’t believe it won’t work."

Britton convinced the group. Sisters of Mercy launched Resource Optimization and Innovation (ROi) as its supply chain operations division, including a consolidated service center, with Britton at the helm. During the next decade, ROi spearheaded the MercyMeds barcoded medication administration program, Mercy SafeWatch program for remote ICU monitoring and participated in Mercy’s electronic health record system.

Along the way, Britton and his team learned about aligning an organization’s supply chain strategy with the overall business strategy, how and why to gain control over information, flow of goods and relationships between customers and suppliers, as well as how to develop a "clinically integrated supply chain" that placed the clinical, operational and financial components in the right order where the first two factors of the equation lead to the third.

Barely two years ago after nearly a decade of success stories, Britton succeeded Sisters of Mercy’s CEO.

Vance Moore, who succeeded Britton at ROi, emphasized that CEOs do understand how important the supply chain is to the clinical, operational and financial health of an organization largely because the function represents one of the largest expense areas of the organization, but too often underestimated by traditional metrics. In fact, Moore cited a study conducted by a quintet of prominent integrated delivery networks predicting that supply chain’s costs conceivably could exceed labor’s costs over time.

As a result, supply chain resembles the automobile manufacturing and banking industries at the nadir of their 21^st Century existence per Presidents Bush and Obama – too big to fail.

To some, that supposition may be too hard to swallow…just like the bitter truth that supply chain no longer can be confined to the basement or the warehouse.

The mind may be a terrible thing to waste per the famous slogan of the NAACP. But to the hospital C-suite and supply chain management, so are freedom and influence.