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         Clinical intelligence for supply chain leadership

 
 
 

INSIDE THE CURRENT ISSUE

August 2013

Special Focus   This Month's Advertisers

GHS supply chain team pinpoints strategies, tactics for success

Greenville (SC) Health System’s Executive Director of Supply Chain and Chief Procurement Officer John Mateka, MBA, MHA, shared with Healthcare Purchasing News his team’s attitudes and motivations behind what, how and why they do what they do with valuable insights on what makes them so successful.

HPN: What’s the secret formula that makes a leader in supply chain management? How does your department implement that secret formula?

MATEKA: It starts off with a vision – knowing where you’re at, where you need to go and what it will take to get you there. The next crucial component is your team. Any good supply chain operation is only as strong as its weakest link. Running a department is like sports: If you’re going to compete and win the championship, you have to have a complement of players that can meet and beat the competition, or in our case, the challenges and demands of our ever-changing healthcare environment. I am very grateful and proud of our Supply Chain team at GHS.

The next big trend in healthcare supply chain management will be...[fill in the blank]. Why?

Movement away from inpatient services to decentralized services, including necessary logistical and information system changes. Consequently, I continue to be a fan of RFID/RTLS technology to help manage and facilitate these operational changes and programs outside our main hospitals. I call it ‘tracking invisible processes.’ They include service/delivery times, resource location of staff and equipment, loss prevention, and alarm notification for temperature monitoring, loss prevention, supply/equipment charge/replenishment. All of this extends far beyond asset tracking of today. Doing more with less will continue to be our challenge. We need all the help and information we can get!

Some in the “C-suite” have criticized materials managers for being too technical and not strategic enough to “join their club.” Do you agree? Why?

Yes, most materials managers have come up through the ranks and have extensive operational experience. Accordingly, most favor what they know and if most of what they know is only healthcare materials management, then it’s difficult to think outside the box or see a different big picture. That being said, many materials managers have been successful in working their way to the top. However, all have demonstrated strategic thinking and an ability to deal with ambiguity, have prepared themselves educationally and have demonstrated a proven and diverse track record of successful programs and exemplary leadership.  Tenure alone will not get you to the [vice president] level.

What specific project did your department complete where you felt they didn’t lived up to your expectations?

Our Print Management Program, which involved the reduction of personal printer use, paper/toner. It was a $500,000-$1 million annual savings opportunity. I under-estimated the critical role Information Systems played in an initiative of this nature. Without their support and buy-in it didn’t have the success expected.

What specific project did your department complete where you felt they exceeded your expectations?

I continue to be pleased and relieved with achievement of our Supply Chain annual savings targets. Each year we submit our proposal, and each year, administration talks us into increasing the number another million dollars or so. Please understand that we map out our planned initiatives and projects. Therefore, to arbitrarily agree to a target with no plan is a little unnerving. Fortunately, with our GPO affiliation and physician support we have been able to identify and achieve the additional savings. This will continue to become increasingly more difficult, however, as we squeeze non-labor expense opportunities out of the system.

If you could change one thing about your facility’s corporate resources and materials management department, what would it be and why?

I would add or incorporate Six Sigma programs and resources. We have done most of what we can do with pricing and with Value Analysis picking up the pace on utilization review. I believe our function can continue to contribute with expense reduction programs within and beyond the supply chain. Resource management and non-salary expense reduction appears to be where we need to be focused. And that needs resources and corporate realignment and the proven technology of Six Sigma practices and programs.

In your opinion, what is your department’s toughest administrative challenge? How might you solve it?

Gaining senior leadership attention. However, when you think of it, we are in the business of saving lives and returning folks to good health. As much as we like to see ourselves as the center of the healthcare universe, we are one piece of the healthcare puzzle. We need to have patience, appreciation for our true core business, and continue to show value with excellent service support and expense management.

What is your department’s toughest operational challenge? How might you solve it?

Engagement from departments and users. Sometimes we just seem to be in their hair! Nonetheless, change usually takes time, resources and money, all of which department heads and leadership have little of. Therefore, Supply Chain needs to do as much legwork, analysis and pre-work that we can to help make the decisions and then help with implementation.

What are your top three priorities for the remainder of 2013 and for 2014?

  • Meet system savings target(s) and budget

  • Integrate a newly acquired hospital

  • Finalize the structure and business plan for self distribution to serve our system, affiliates and our collaborative partner.

What do you believe are some barriers to growth for your department in the future and how do you plan to overcome them?

If growth is defined as taking on more responsibilities and/or functions, I don’t plan on growing much more. Perhaps Pharmacy and Supply Chain can work a little more collaboratively on the contracting and logistics opportunities. Nonetheless, both are doing great things. If I perceive a barrier or obstacle, typically I attempt to outline and define the value proposition. If you can add value, quality and/or expense reduction, make your case. If you can’t define the value proposition, leave it alone.

What’s the most enjoyable part of your department’s function?

I believe I am addicted to endorphins! And nothing gets my endorphins flowing than putting a plan together and seeing it to fruition. Over the past 10 years there have been many opportunities to bring about change and introduce new, innovative programs. Gotta love it! Get-r done!

What’s the most difficult part of your department’s function?

It goes without saying…not getting things done. Healthcare is under a lot of pressure with an extreme demand on resources and administrative attention. Sometimes you just need to wait in line.

How does the CEO view your department? Does he or she see it as a strategic function or a support service? What resources can the department count on and will they come every year – and not just in response to clinician complaints?

Our CEO is very strategic, yet connected to the organization and staff. He involves his leadership team, directors and above, yet relies on his senior leadership ‘0s’ to run the business. He has commented and is appreciative of the work we do and includes our team in a quarterly town hall meeting. He will reach out on strategic issues related to the supply chain on more of an ad hoc basis. We are very connected to our COO and CFO and included in appropriate strategies.

Editor’s Note: The CEO is a former healthcare supply chain executive.

What’s the one project or task you’ve always wanted your department to tackle but it has yet to pick up the ball?  

As I think of it, I picked up all the balls I wanted. A better question might be what balls haven’t you picked that perhaps you should? My answer would be Pharmacy. I believe there are opportunities in contracting and logistics within the Pharmacy and Supply Chain functions. However, our Pharmacy is doing such a great job with the formulary and other programs. I just haven’t found the desire to go play in their sandbox.

What are some practical, common sense ways that supply chain managers can keep patient satisfaction in mind as they’re performing their duties?

Ask your Supply Chain staff what they do. If they do not say ‘provide quality healthcare’ or some form of that answer then they haven’t been educated on their primary role in our business of healthcare. This is not to downplay their job or role in healthcare and the importance of their piece of the puzzle. But all roads lead to the patient, our Supply Chain team needs to know and appreciate that. When we please and make our clinicians happy with consistent reliable service that will pass on to those they serve, the patient.

If you could change one public perception of your department, what would it be and why?

Supply Chain is typically a thankless job. As service support, we are like water in the faucet. Folks expect the water to come out, but rarely are thankful when it does. So when we hear nothing, i.e., ‘How’s the supply chain? No problem,’ that’s a good thing. We do have stars that go above and beyond, but for the most part, no news is good news. So we provide a newsletter to keep everyone informed of what we’re doing, celebrate those that receive special thanks and try and keep our customers informed on what we’re doing.

What’s the one job/assignment your department probably should have turned down?

I can’t think of one but I used to be an administrator over support services, which included Supply Chain, Housekeeping, Facilities, Security and Food Service. I am somewhat of a hands-on person, thus I prefer the concentration of Supply Chain, procurement and non-salary expense reduction. It crosses departmental lines but doesn’t have the broad operational and staffing requirements as with the other support functions.

What’s the most creative thing your department has ever done?

I like quick and easy, so the loss prevention portal I had installed in our waste hall in our major OR is a good example. It’s not much different than those found in high-end retail department stores. We RFID-tagged and tracked items that were inadvertently placed in the trash. Within a month or so, we recovered two $18,000 Neoprobes along with a few other items. Essentially, folks thought we might be losing items this way but had no proof or certainty of the frequency it was occurring. We are tracking less items through the portal now because of the increased awareness and instant notification [via alarm] of an item on its way to the dumpster. 

How can supply chain managers collaborate with other departments and professionals and convince them that their decisions are based on the financial health of the organization and not in denying them quality products or dictating patient care as the clinicians might tell the CEOs?

In our organization, we are physician-led, so for the most part clinical decisions are made by clinicians and not by Supply Chain. We recommend, outline savings opportunities and analyze requests. We don’t have to convince them because they were part of the decision process from the start. Understand, this takes some structure and work to get to a point where decisions are based on quality, outcomes and cost. We don’t ask, ‘Can you use it?’ We ask, ‘Why can’t you use it?’ Clinical preferences are challenged by clinicians, and we have a closed formulary in our OR. Other than an emergency, every product is approved prior to use or we don’t pay for it.

What advice do you have for professionals outside of healthcare wanting to enter into the field of healthcare supply chain management?

The business model in healthcare is unique and completely different than the typical for-profit industry/manufacturing model. Economic rules of supply and demand do not apply. In healthcare, who is our customer? The patient who we provide the facility and mechanism to provide care? The doctor who we need to admit patients to our facility? Or the insurance company who pays us for the service? Obviously, all three. This makes it confusing at times. Furthermore, the business and clinical side of healthcare are two different-focused entities, yet collaboratively share the same goal – quality healthcare with a reasonable margin. So those that want to enter healthcare would benefit from understanding healthcare business, then spend some time, if possible, observing and/or participating in our core business – quality patient care. With an appreciation of what we’re all about, then they can be introduced to the technical non-healthcare expertise, financial, industry, manufacturing and sales within the supply chain.