Question

Describe several elements of the supply chain systems. Is it your conviction that the elements you chose do or do not improve efficiencies within the health care environment? Please state why or why not and support your response with two references.

Answer 1

Healthcare supply chain management is the regulation of the flow of medical goods and services from manufacturer to patient. Supply chain management (SCM) is a process used by companies to ensure that their supply chain is efficient and cost-effective. A supply chain is the collection of steps that a company takes to transform raw components into the final product. The following are five basic components of SCM. In commerce, supply chain management (SCM), the management of the flow of goods and services, involves the movement and storage of raw materials, of work-in-process inventory, and of finished goods from point of origin to point of consumption. Supply chain management (SCM) is the oversight of materials, information, and finances as they move in a process from supplier to manufacturer to wholesaler to retailer to consumer. The three main flows of the supply chain are the product flow, the information flow and the finances flow. SCM is externally focused. Supply chain managers work with external partners to procure parts and raw materials needed to produce the product, create the inventory, and sell the product to outside markets. These professionals evaluate suppliers and negotiate contracts with vendors. The supply chain generally refers to the resources needed to deliver goods or services to a consumer. In healthcare, managing the supply chain is typically a very complex and fragmented process.

In an enterprise resource planning (ERP) software environment, SCM is not a discipline unto itself. It is part of the business as a whole, with multiple dependencies between finance, manufacturing, purchasing and sales. An ERP system focuses on the management of business information, offering a macro view into a company by integrating disparate systems across functional groups such as procurement, finance, distribution, and inventory control. Manufacturers can use supply chain electronic data interchange (EDI) to control processes such as purchase orders, shipment notices and invoices. SCM EDI speeds the transfer of electronic business processes. Channel coordination (or supply chain coordination) aims at improving supply chain performance by aligning the plans and the objectives of individual enterprises. It usually focuses on inventory management and ordering decisions in distributed inter-company settings. Healthcare supply chain management involves obtaining resources, managing supplies, and delivering goods and services to providers and patients. To complete the process, physical goods and information about medical products and services usually go through a number of independent stakeholders, including manufacturers, insurance companies, hospitals, providers, group purchasing organizations, and several regulatory agencies. Source Code Management when talking about, well, source code. On the other hand, if you're keeping config files (things in /etc, application-specific config files, etc.) in an SCM, then a lot of people expand the acronym to Software Configuration Management. Logistics Management is a small portion of SCM that deals with management of goods in an efficient way. Although, if we talk about SCM, it is a broader term which refers to the connection, right from the suppliers to the ultimate consumer. Healthcare supply chain management is unique because each stakeholder has their own interests to protect. Different stages in the supply chain flow may be focused on their own goal. Providers may want to use a specific product because they were trained with it, whereas hospital executives aim to purchase the most affordable quality items.
SCM involves optimizing your operations to maximize both speed and efficiency. Speed is important because customers value fast service. Increasing speed, however, can cause costs to skyrocket, so maximizing efficiency is equally important.
Some healthcare organizations have found success with supply chain management through cost transparency. By harnessing price and utilization data, healthcare organizations can track and manage inventory more efficiently and construct more informed purchasing contracts with manufacturers. Due to vertical internal structures, supplies and supply data historically have been siloed and firewalled so that information important for efficient business operations is fragmented. We end up spending billions of dollars of inventory within these various silos because we live in a world where you can never run out of anything ever, in the interest of what is best for the patient. When we have visibility of product from finished goods to the use on the patient and we actually capture demand and consumption versus capturing purchasing activity, we capture consumption activity. We significantly reduce waste and variation in the supply chain. Inventory levels come down for everybody. Product expiration can be virtually eliminated. Different automated tools can help organizations increase price transparency, such as computerized provider order entry systems, which can standardize and streamline physician orders, or Radio Frequency Identification technology that can capture volumes of data from a product’s barcode. Getting all hospital departments on the same page is also a key strategy for optimizing healthcare supply chain management. In the era of value-based care, healthcare organizations are focused on reducing redundancies and eliminating waste, but providers also need to work together to effectively reduce costs and boost performance. The supply chain touches every department within the hospital,” stated Spann “You must look at the people in the organization, supply partners, and determine how you can get synergy and maximum productivity out of your clinical and supply chain staffers to achieve your supply chain goals. Engaging clinical staff can also help to establish cost-saving habits, discourage hoarding, and empower providers to keep cost concerns in mind when delivering care. Today, health systems must be willing to take risks,” continued Spann. “They have to be willing to hand over the keys and allow physicians to co-lead these strategies. Physicians will engage when they understand the issues, and it is very important to let them help craft a solution that they can stick to.