By: Dan Farruggio October 1, 2024
It’s no secret that the healthcare industry has been experiencing challenges as of late. From staffing and retention issues, to increasing costs for medical procedures and prescription medicine, it’s created a unique situation for healthcare providers and hospital systems alike.
So, it begs the question. How can organizations manage these growing supply chain challenges and in turn provide greater patient care as a result?
Last week, RPI Consultants had the opportunity to attend the Association for Health Care Resource & Materials Management (AHRMM) conference in Ohio, where we explored the latest developments in healthcare supply chain management and strategies for addressing ongoing industry obstacles.
Below, we highlight the current trends and challenges in healthcare supply chains and offer creative solutions to help you tackle them.
Trend 1: Supply chain disruptions & shortages: As one would expect, COVID-19 exposed vulnerabilities in global supply chains, particularly in healthcare. Since the pandemic, hospitals have faced shortages of personal protective equipment (PPE), medical devices, and even essential pharmaceuticals. These disruptions highlight the need for more agile and transparent supply chains, including software infrastructure for supporting them.
Trend 2: Rising costs & labor shortages: At the event, findings were shared about the increasing costs of supplies and ongoing resource shortages. These challenges align with research from the American Hospital Association, which reports that hospital labor costs have risen by more than $42.5 billion in recent years, while new drug prices have surged by 35%, placing additional strain on healthcare budgets. Healthcare organizations face constant pressure to do more with less, a problem further exacerbated by rising regulatory compliance costs related to privacy and patient confidentiality. With inflation driving up supply chain costs, shrinking budgets, and a burnt-out workforce, organizations must find ways to optimize resource allocation without compromising service quality.
Trend 3: Sustainability & green supply chains: Strides for organizational focus on environment, social, and governance criteria (ESG) are on the rise and were discussed at AHRMM. From a supply chain perspective, environmental sustainability is becoming a key focus for healthcare providers. Implementing green supply chain practices, such as minimizing waste, reducing carbon footprints, and sourcing sustainable materials, is not only a social responsibility but also in many parts of the world, a legal requirement. However, achieving sustainability goals requires end-to-end visibility and efficient resource tracking—something traditional supply chain systems often lack and has grown more difficult to monitor in recent years due, in part, to many of the challenges outlined above.
Trend 4: Technology & data analytics: Supply chains based on modern technology, like Infor CloudSuite, generate vast amounts of data. However, as highlighted at AHRMM, many healthcare organizations continue to struggle to make use of this data to generate actionable insights. Real-time visibility into inventory levels, predictive analytics for demand forecasting, and the integration of advanced technologies such as AI are critical to building more resilient and responsive supply chains, but many of these organizations lack the resources and skills to really maximize use of said technology.
Trend 5: Vendor & contract management: Managing vendors and contracts is a critical challenge in healthcare, particularly for teams experiencing high volumes and limited resources. As expert consultants in contract management, we empower our clients with knowledge, strategies, and processes necessary to maintain contract compliance. However, many organizations continue to face difficulties in this area, which is understandable given the complexity involved. Tasks such as overseeing negotiated terms, tracking contract performance, and maintaining vendor relationships don’t need to be but are often time-intensive tasks for any team—especially without the right systems in place.
With supply chain challenges still affecting many healthcare organizations across the U.S., creative solutions must be deployed to solve them. Drawing on insights from AHRMM 2024, below are five ways to address the unique needs of healthcare organizations as well as alleviate the challenges mentioned above:
Method 1: Enhance supply chain visibility: One of the most important strategies discussed at the event was the need for greater transparency. A great solution for achieving supply chain visibility is Infor Financials & Supply Management, which provides live-time visibility across your entire supply chain, allowing you to monitor inventory, track orders, and anticipate shortages. With this level of insight, organizations can quickly adapt to disruptions, ensuring patient care is not compromised.
Method 2: Cost optimization & compliance: Rising costs are a major concern, but with the right tools, organizations can in fact, do more with less. CloudSuite FSM, when properly configured by leading consultants such as RPI, provides teams with the ability to monitor their spending, ensuring efficient resource allocation while also reducing unnecessary expenses on supplies. Plus, with its built-in compliance features, healthcare organizations can meet regulatory requirements with ease and reduce the administrative burden associated with manually tracking them.
Method 3: Sustainability & resource management: As discussed at AHRMM, green supply chains are not just a trend but a necessity. Modern cloud solutions can support this initiative by tracking and managing resources via intuitive dashboards that pull directly from inventory management. This kind of visibility enables healthcare organizations to understand their inventory controls, and subsequently implement sustainable practices where necessary. By reducing waste and improving inventory accuracy, hospitals can more easily meet sustainability goals and requirements.
Method 4: Data-driven analytics: Turning data into actionable insights is crucial for most business sectors, and healthcare is no different. Fortunately, solutions like Infor CloudSuite leverage powerful analytics tools to help healthcare organizations make informed, data-driven decisions. Predictive analytics enhance forecasting, and AI-driven technology ensures supply chains are always one step ahead. At the AHRMM, many vendors, including RPI, discussed creative solutions for gaining more visibility into data through AI. One example is Infor AI, which can provide greater insight into supply forecasting needs based on scheduled procedures. The system can review upcoming surgeries and identify the necessary supplies required to perform it successfully and balance it against current inventory management levels.
Method 5: Streamline vendor & contract management: Managing multiple vendors and contracts was a key theme at AHRMM. An excellent solution for tracking various contractor and vendor agreements is Infor CloudSuite Contract Management. The platform includes a centralized vendor data platform that automates compliance tracking, issues notifications when contracts and updates require user attention, and makes the process for communicating with partners seamless. This functionality can help you optimize vendor agreements while reducing the time and effort spent on administrative tasks.
While Infor Financials & Supply Management offers a wide variety of benefits for supply chain professionals working in healthcare, the fact remains that the software is only as good as your ability to use it. Realizing the benefits of the right software and overcoming the current healthcare supply challenges requires collaborating with the right ERP partner.
At RPI Consultants, we have over 25 years of experience delivering successful outcomes in healthcare supply chain management and ERP solutions. Whether your organization is considering migrating to a cloud ERP or is looking to maximize its CloudSuite investment, our team of experts will work with you to implement leading practice solutions and optimize your current supply chain processes.
Ready to take control of your supply chain? Contact us today to learn how RPI Consultants can help your organization drive efficiency, reduce costs, and build a more resilient future.