chain team pinpoints strategies, tactics for success
(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
HPN: What’s the secret formula that makes a leader in supply chain
management? How does your department implement that secret formula?
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?
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?
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
What specific project did your department complete where you felt they
didn’t lived up to your expectations?
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?
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?
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
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?
system savings target(s) and budget
a newly acquired hospital
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?
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?
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
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
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?
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
If you could change one public perception of your department, what would it
be and why?
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
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?
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?
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?
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.