The healthcare industry is in the midst of unprecedented change: volatile, unsteady, and unpredictable. One of the most daunting challenges today’s supply chain leaders face is evolving their processes to meet the demands of a changing business model. For those brave enough to chart their own course, the five best practices listed below will get you moving in the right direction:
Implement data standards
Global GS1 standards for product identifiers such as bar codes can result in major savings by automating supply chain operations. A UPS survey on healthcare supply chain management shows that nearly half of respondents are undertaking initiatives on data standardization.
Create modern inventory management systems
These systems help to optimize the safety stock of each SKU for each inventory location. The UPS survey shows that 2/3 of all respondents are planning to invest in IT. Of those, 75% want an order management system and 63% want a web ordering system.
Reduce inventory without adversely affecting service
Unnecessary SKUs typically account for 20-30% of a healthcare system’s total SKUs. Sixty-two percent of healthcare supply chain managers also have major concerns about product damage and spoilage due to obsolete inventory.
Collaborate with key suppliers
61% of respondents said a regular logistics partner was successful in cutting costs. This strategy could be equally useful for other healthcare supplies such as chemicals and pharmaceuticals.
Find a reliable transportation partner
A transportation provider who is flexible to your needs is vital for controlling costs of a healthcare supply chain. This practice will primarily benefit the 56% of healthcare suppliers who distribute products through distributors or wholesalers and the 46% who ship directly to customers. Of the decision makers in healthcare supply chains, 69% cite temperature and weather as a top challenge in maintaining product integrity.
These practices are most effective when supported by technological resources, especially strong analytics. Healthcare systems need to incorporate these resources into their daily practices to maximize their negotiating leverage with suppliers. Data resources should also allow users to easily make comprehensive comparisons between products based on commitment level, price and volume.
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