healthcare study - feb-apr 2013 - healthcare provider summary charts

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Healthcare Study: Healthcare Providers Summary Charts Feb-Apr 2013

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How Do We Heal the Healthcare Value Chain? Over the last decade, as shown in figure 1, the hospital supply chain has been one of the few that has improved operating margin, reduced inventory and improved revenue/employee. In contrast, the manufacturing suppliers to the hospital organization have grown inventories and struggled to preserve margins. Across the value chain from the patient to the raw material suppliers, total inventories have grown and costs have escalated. With pending regulations, hospitals are being forced to rethink processes, redefine value and work more holistically to improve sourcing practices. The suppliers to the hospital systems are having to rethink their systems to rethink the customer (from selling to the physician to selling to a more formal buying organization based on patient outcomes) and adapt to the new processes within the hospital for value analysis. Supply chain processes within the hospitals have matured. Hospitals have made more progress on improving cash-to-cash cycles than their upstream manufacturing trading partners. They have reduced inventories and attempted to work with suppliers. As shown in figure 2, it is notable to see that this industry is one of the few where downstream trading partners have actually improved payable terms for their suppliers. The future lies before the healthcare provider. As the provider of patient care, they have the greatest potential to lead in the healthcare value chain’s redesign to improve value. They have come a long way, but the changes have been incremental. They have focused primarily on traditional sourcing techniques; not a redesign of the healthcare value chain from the outside in, and the redefinition of complex and antiquated processes.

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Page 1: Healthcare Study - Feb-Apr 2013 - Healthcare Provider Summary Charts

Healthcare Study:Healthcare Providers

Summary ChartsFeb-Apr 2013

Page 2: Healthcare Study - Feb-Apr 2013 - Healthcare Provider Summary Charts

Supply Chain Insights LLC Copyright © 2013, p. 2

Agenda

Study Overview

Measuring Value and Cutting Costs

Supply Chain Performance

Supply Chain Organization

Page 3: Healthcare Study - Feb-Apr 2013 - Healthcare Provider Summary Charts

Supply Chain Insights LLC Copyright © 2013, p. 3

Study Overview

Page 4: Healthcare Study - Feb-Apr 2013 - Healthcare Provider Summary Charts

Supply Chain Insights LLC Copyright © 2013, p. 4

Most Respondents Work Within the Hospital Supply Chain

Page 5: Healthcare Study - Feb-Apr 2013 - Healthcare Provider Summary Charts

Supply Chain Insights LLC Copyright © 2013, p. 5

Over Half Have Over 20 Years Experience in Healthcare and Supply Chain

Page 6: Healthcare Study - Feb-Apr 2013 - Healthcare Provider Summary Charts

Supply Chain Insights LLC Copyright © 2013, p. 6

Agenda

Study Overview

Measuring Value and Cutting Costs

Supply Chain Performance

Supply Chain Organization

Page 7: Healthcare Study - Feb-Apr 2013 - Healthcare Provider Summary Charts

Supply Chain Insights LLC Copyright © 2013, p. 7

Top Way to Measure Value is Lower Costs Without Reducing Quality of Care

Page 8: Healthcare Study - Feb-Apr 2013 - Healthcare Provider Summary Charts

Supply Chain Insights LLC Copyright © 2013, p. 8

Negotiating Lower Prices is Most Important Cost-Cutting Effort

Page 9: Healthcare Study - Feb-Apr 2013 - Healthcare Provider Summary Charts

Supply Chain Insights LLC Copyright © 2013, p. 9

Negotiating Lower Prices is Top Performing Cost-Cutting Effort

Page 10: Healthcare Study - Feb-Apr 2013 - Healthcare Provider Summary Charts

Supply Chain Insights LLC Copyright © 2013, p. 10

Important but Low Performance: Improving Product Utilization

and Working Across Functional Silos

Page 11: Healthcare Study - Feb-Apr 2013 - Healthcare Provider Summary Charts

Supply Chain Insights LLC Copyright © 2013, p. 11

Important but Low Performance: Improving Product Utilization

and Working Across Functional Silos

Page 12: Healthcare Study - Feb-Apr 2013 - Healthcare Provider Summary Charts

Supply Chain Insights LLC Copyright © 2013, p. 12

Other Cost-Cutting Efforts (Open-Ended)

Page 13: Healthcare Study - Feb-Apr 2013 - Healthcare Provider Summary Charts

Supply Chain Insights LLC Copyright © 2013, p. 13

Other Cost-Cutting Efforts, Continued(Open-Ended)

Page 14: Healthcare Study - Feb-Apr 2013 - Healthcare Provider Summary Charts

Supply Chain Insights LLC Copyright © 2013, p. 14

Other Cost-Cutting Efforts, Continued(Open-Ended)

Page 15: Healthcare Study - Feb-Apr 2013 - Healthcare Provider Summary Charts

Supply Chain Insights LLC Copyright © 2013, p. 15

Value Analysis Group:Nearly Three-Quarters Have a Formal Program or Group

Page 16: Healthcare Study - Feb-Apr 2013 - Healthcare Provider Summary Charts

Supply Chain Insights LLC Copyright © 2013, p. 16

Value Analysis Group: Supply Chain is Primary Leader;

Changing/Adding Products are Most Common Decisions

Page 17: Healthcare Study - Feb-Apr 2013 - Healthcare Provider Summary Charts

Supply Chain Insights LLC Copyright © 2013, p. 17

Value Analysis Program:Supply Chain Costs, Physician Preference and Infection Rates

are Top Decision Factors for Product Changes/Additions

Page 18: Healthcare Study - Feb-Apr 2013 - Healthcare Provider Summary Charts

Supply Chain Insights LLC Copyright © 2013, p. 18

Value Analysis Program:Two-thirds Rate Program as Successful

Page 19: Healthcare Study - Feb-Apr 2013 - Healthcare Provider Summary Charts

Supply Chain Insights LLC Copyright © 2013, p. 19

Collaborative Programs:Over Half Have Any Collaborative Programs for Increasing Financial Performance When Buying Supplies/Equipment

Page 20: Healthcare Study - Feb-Apr 2013 - Healthcare Provider Summary Charts

Supply Chain Insights LLC Copyright © 2013, p. 20

Collaborative Programs:Collaborative Programs with Suppliers

Are the Most Common

Page 21: Healthcare Study - Feb-Apr 2013 - Healthcare Provider Summary Charts

Supply Chain Insights LLC Copyright © 2013, p. 21

Collaborative Programs:Collaborative Programs with Suppliers

Are the Most Common

Page 22: Healthcare Study - Feb-Apr 2013 - Healthcare Provider Summary Charts

Supply Chain Insights LLC Copyright © 2013, p. 22

Collaborative Programs:Nearly Half Rate Them as Effective

Page 23: Healthcare Study - Feb-Apr 2013 - Healthcare Provider Summary Charts

Supply Chain Insights LLC Copyright © 2013, p. 23

Other Efforts to Reduce Costs(Open-Ended Responses)

Page 24: Healthcare Study - Feb-Apr 2013 - Healthcare Provider Summary Charts

Supply Chain Insights LLC Copyright © 2013, p. 24

Other Efforts to Reduce Costs, Continued(Open-Ended Responses)

Page 25: Healthcare Study - Feb-Apr 2013 - Healthcare Provider Summary Charts

Supply Chain Insights LLC Copyright © 2013, p. 25

Agenda

Study Overview

Measuring Value and Cutting Costs

Supply Chain Performance

Supply Chain Organization

Page 26: Healthcare Study - Feb-Apr 2013 - Healthcare Provider Summary Charts

Supply Chain Insights LLC Copyright © 2013, p. 26

Reducing Costs and Managing Data Are Top Business Challenges in 2013

Page 27: Healthcare Study - Feb-Apr 2013 - Healthcare Provider Summary Charts

Supply Chain Insights LLC Copyright © 2013, p. 27

Top Supply Chain Roles in 2013: Reducing Costs, Improving Value-based Outcomes

and Improving Inventory Turns and Cost

Page 28: Healthcare Study - Feb-Apr 2013 - Healthcare Provider Summary Charts

Supply Chain Insights LLC Copyright © 2013, p. 28

Three out of Five Rate Their Supply Chain as Successful in Meeting Goals

Page 29: Healthcare Study - Feb-Apr 2013 - Healthcare Provider Summary Charts

Supply Chain Insights LLC Copyright © 2013, p. 29

Reasons for Rating Supply Chain as Successful (Open-Ended)

Page 30: Healthcare Study - Feb-Apr 2013 - Healthcare Provider Summary Charts

Supply Chain Insights LLC Copyright © 2013, p. 30

Reasons for Rating Supply Chain as Somewhat Successful, Continued (Open-Ended)

Page 31: Healthcare Study - Feb-Apr 2013 - Healthcare Provider Summary Charts

Supply Chain Insights LLC Copyright © 2013, p. 31

Reasons for Rating Supply Chain as Less Successful (Open-Ended)

Page 32: Healthcare Study - Feb-Apr 2013 - Healthcare Provider Summary Charts

Supply Chain Insights LLC Copyright © 2013, p. 32

Inventory, Compliance and Customer Satisfaction Are Where Supply Chain Performs Best

Page 33: Healthcare Study - Feb-Apr 2013 - Healthcare Provider Summary Charts

Supply Chain Insights LLC Copyright © 2013, p. 33

Agenda

Study Overview

Measuring Value and Cutting Costs

Supply Chain Performance

Supply Chain Organization

Page 34: Healthcare Study - Feb-Apr 2013 - Healthcare Provider Summary Charts

Supply Chain Insights LLC Copyright © 2013, p. 34

Supply Chain Organization:Three-Quarters Have a Formal Supply Chain Organization

Page 35: Healthcare Study - Feb-Apr 2013 - Healthcare Provider Summary Charts

Supply Chain Insights LLC Copyright © 2013, p. 35

Supply Chain Organization:7 Functions Report Through It on Average;Reports Primarily to Chief Financial Officer

Page 36: Healthcare Study - Feb-Apr 2013 - Healthcare Provider Summary Charts

Supply Chain Insights LLC Copyright © 2013, p. 36

Supply Chain Organization:Most Likely to Contract and Manage for

Medical & Surgical Commodities

Page 37: Healthcare Study - Feb-Apr 2013 - Healthcare Provider Summary Charts

Supply Chain Insights LLC Copyright © 2013, p. 37

Supply Chain Organization:Purchasing is Primarily Done Corporate-Wide