eworld - nhssc presentation sept 2008 v2
TRANSCRIPT
We listen…
communicate…
focus…
…then deliver
Selection & Implementation of an Integrated Sourcing & Contract Management Solution
Bryan Semple, IT Solutions Director, NHS Supply Chain
Taking Care. Nationwide
Presentation Outline
NHS Supply Chain - Introduction
How?
Implementation Challenges
Why?
Business Benefits
NHS Supply Chain Opts For An Integrated End-to-End Sourcing and Contract Management Approach – Why and How?
Who Are We?
• NHS Supply Chain is the integration of NHS Logistics, part of NHS PaSA and DHL
• DHL appointed 1st October 2006 to manage NHS Supply Chain on behalf of the Department of Health
• Global Organisation
• 500,000 employees
• Express, Logistics, Mail and Financial Services
• Healthcare sector in the UK [Bridgwater DC and Hospital Logistics]
• Life Sciences – Global Pharma and medical companies
• 320 employees
• Sourcing and Contracting entity on behalf of the NHS
• Originally all Non Pay Spend
• Specific to Utilities, Pharma, Agency and Services
• Civil Service culture
• 1500 employees
• Built an infrastructure and capability around NHS Supplies organisations
• Dedicated purchase to pay systems and online ordering
• 6 Distribution centres
• Transport Network –outsourced to CEVA
• Unison Membership
Our Vision & Value Proposition
We aim to be the best value, and most innovative, healthcare supply chain for the NHS
Private homes
Nursing hom
esOur span of influence and control
DistributionCentres TrustsConsolidation
SupplyCentre
Sourcing &procurement
Raw
mat
eria
ls pr
oduc
tion
E-commerce
Supplier ServicesProcurement Services Logistics Services Supply Chain Services Patient Services
C5bn Market11 TFR3 Categories
Incl Theatres, Medical/Surgical, Clinical Markets, Food & FacilitiesCapital Equipment & Maintenance
Logistics Services
ServicesUtilitiesEstatesPharma
Agency ServicesTransport
How have we evolved?Our Market
• NHS Supply Chain has exclusive scope from the DoH that covers over £5bn of market. This represents 28% of NHS Non Pay spend*
*Pharma accounts for 57%
NHS SC Networked and Transacted
Legacy PaSA Frameworks and Direct contracts
Available Market –New Categories
1bn
0.6b
n3.
3bn
5bn
Market Current Profile
Complex Procurement Landscape
NHS procurement in
practice
NHS Trusts- provision of services and related purchasing -
Departmentof Health
- strategy and funding -
CollaborativeProcurement
Hubs- cost efficient
procurement at regional level -
Centre forEvidence Based
Purchasing-clinical evidence
gathering -MHRA
- product regulation and safety -
NICE- cost and clinical effectiveness -
NHS Institute- disseminatinginnovation and best practice-
NHS PASA- pricing and procurement -
NPSA- monitoring and
improving patient safety -
Savings – Business Case & Actual To Date
• Generating savings for the NHS is at the core of our business plans.
• We are committed to delivering over £1bn savings over the 10 years of our contract− Cash releasing savings of £9m in year 1 [Target 1m]− Cash releasing savings forecast in year 2 – £18m
[Target 5m]
• We procure once only on a national scale, leveraging NHS buying power − Audiology - £25,000 annual cash savings per trust− Imaging & Diagnostic capital - £14m savings for
NHS forecast in 2008
2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 20160
150
300
450
600
750
900
1,050
1,200
1,350
1,500
1,650 BC NHS Savings
Actual NHS Savings
2007 2008 20090
20
40
60
80
146
~~~
9m16m
IT Enabled Business Transformation
BUSINESS TRANSFORMATION
• DHL has invested over £25m in the first year of the contract
− People and Training
− IT Infrastructure & Enablers
− Process re-engineering
• Continue to invest in 2008 / 2009
− New Infrastructure
− IT Change programme
− Capital Managed Services
− New Category development
IT ENABLERS
• Catalogue Management / eCommerce Upgrade
− Move from 50,000 to 650,000 products
− Catalogue Enrichment
− 33 million order lines pa across 250,000 requisition points and growing
• Legacy Systems Replacement
− RESUS over 20 years old
− Constraint on new business services (e.g. HDS)
− Lack of operational effectiveness and efficiency
• Business Intelligence and Data Management
− Data Quality
− “Actionable Insights” for suppliers and customers
Transforming Procurement – Key Challenges
People
Process
SystemsData
Market Info
Suppliers
People
OUTCOME• New organisation aligned with business imperatives• Commercial training for all• Clear management goals and incentives• Still some way to go!
CHALLENGES• Inherited 80+ personnel from NHS PaSA• Recruited another 30+• Organisation structure not aligned with business• Mixed culture (“let and forget”)• Commercialisation• Training
People
Process
SystemsData
MarketInfo
Suppliers
People
Process
Systems
Data
MarketInfo
Suppliers
Processes & Systems
OUTCOME• Single end-to-end Way of Working for all core processes• One system with flexibility and rules to drive consistency• Building in and improving best practice, template driven• Management dashboards and alerts to drive performance resource balancing• Fully hosted and managed solution, minimising investment and increasing flexibility• Increased use of eAuction, driving additional benefits
CHALLENGES• OJEU Compliance• Lack of consistency across teams• Fragmented systems barrier to process integration• Lack of overall ownership• Cost of multiple systems and hand-offs• Lack of management visibility of activity and
resources• Limited use of eAuctions due to cost and
complexity
Data
OUTCOME• Contract, Price and Product Data captured once at Tender stage• Catalogue populated directly from Contract information• Contract Lifecycle Management - Integrated change control• Alerts, warnings and workflow
CHALLENGES• No single source of data
− Core systems supplemented by > 1000 MS Access databases
• Change Control − Lack of discipline in keeping products, contracts,
contacts and prices up to date
• Poor Quality− Multiple manual rekeying, cut and paste− Lack of supplier visibility
• Speed (lack of)− Weeks to upload and validate contract information
and populate catalogue
People
Process
SystemsData
MarketInfo
Suppliers
Market Intelligence
OUTCOME• Sophisticated data scrubbing and spend analysis tools providing additional
insight to wider NHS market• Identification of gaps and opportunities for additional contract• Monitoring of uptake and non-compliant spend • One version of the truth
CHALLENGES• Limited understanding of wider marketplace• Lack of visibility of existing contract spend• Poor uptake and compliance management• Limited business case development support and
benefits tracking• Multiple interpretations of same data leading to
poor and inconsistent decision making• Limited manual spend analysis capability
People
Process
SystemsData
MarketInfo
Suppliers
Supplier Management
OUTCOME• Single supplier portal for all tender and contract management activities• Workflow and alert management integrated with contract lifecycle• Integrated view of supplier and contract performance for supplier and buyer
CHALLENGES• Fragmented communications channels• Inconsistent mechanism for responding to
tenders and completing responses• Lack of total visibility of supplier performance• No coordination of supplier and buyer activities • Limited supplier visibility of tender pipeline
People
Process
SystemsData
MarketInfo
Suppliers
Solution Selection and Implementation Timescales
• Jan-March 2007 Requirements Definition & Short listing
• April-May 2007 Conducted user workshops and gap analysis
• Jun-Aug 2007 Conducted trials and Blueprint validation exercise
• Sept 2007 Commenced project and detailed design phase
• Mar 2008 System delivered and testing completed
• Apr-Jun 2008 Data migration, training and system configuration
• 30 Jun 2008 Go Live
• July-December 2008 Tender Launch, Coaching and Contract Conversion
• We applied a rigorous and thorough process to our selection of Intenda which had to satisfy both NHS and DHL policies.
• We ran workshops, conference room pilots and even some live trial events, including an eAuction for Baked Beans!.
• Intenda were the only company able to demonstrate a full end-to-end tender and contract management solution and who had a thorough understanding and hands-on experience of OJEU and government procurement
Benefits and Remaining Challenges
KEY BENEFITS• Full OJEU compliant end-to-end solution covering full procurement lifecycle
• Reduced manual effort to set up and execute tenders
• Fully integrated contract management and workflow
• KPIs and performance information
• Integration with NHS-CAT, ensuring data integrity
• Fully hosted environment with minimised investment in hardware and software
REMAINING CHALLENGES• Ongoing coaching and standardisation of ways of working through tender lifecycle
• Outstanding data quality issues with legacy contracts
• Continuous improvement and increased productivity
The Future - Managed Procurement Services for Trusts
Hosted Procurement ServicesOn Demand
• Provides a hosted solution for single tenders and procurement events only
• Consultancy support provided by Intenda to set and manage events
• Access to OJEU compliant, governed and best practice tender management for ad hoc major tenders by “non member” bodies
• E.g. Hub bulk IT capital purchase for member trusts, not covered by existing NHSSC or regional contracts
Hub & Trust Sourcing and Contract Management Solutions
• Uses shared infrastructure to provide a complete ISS environment covering all aspects of Sourcing and Contract Management (not eProcurement)
• A Separate instance will be set up for each “client” based on the standard NHS Blueprint and environment
• Customisation to this environment at individual trust cost. Major rework will require a separate instance and higher costs
Trust/Hub Advantagesn Significantly lower cost of entry and running costsn Uses standard template and processes proven within NHS environmentn Access to best practice advice and experiencen OJEU compliance/Governancen Efficiency of tendering and contract management activityn Visibility of spend and customer requirements
Contact Details
For further information on the use of ISS at NHS Supply Chain contact
Herman FickManaging DirectorT: 0845 4683632 E: [email protected]
Bryan SempleIT Solutions DirectorT: 01773 724000E: [email protected]