Our research has documented that 97% of your overall supply chain expense savings, beyond price and standardization, can only be achieved by having wide-ranging (or extensive broadband and far-reaching scope) visibility of your hospital, system, or IDN’s supply streams. Otherwise, you will only be skimming the surface of your supply expense savings. Here are three ways that wide-ranging visibility can cut your waste to the bone:
- Expands Your Visibility to Identify 79% of All New Supply Chain Expense Savings Opportunities: If you consider your price and standardization savings to be the tip of your iceberg or 21% being visible above the water line, then your utilization misalignments (i.e., wasteful and inefficient consumption, misuse, misapplication or value mismatches) represent the other 79% of your savings below the waterline. These hard to reach savings won’t be achieved with new or renewal GPO contracts; they can only be identified with value analysis analytics.
- Reduces Your Chances of Missing a Supply Chain Expense Savings Opportunity: Because of the frequent incorrect posting of supply expenses to the wrong chart of accounts or merging expenses that shouldn’t be combined, hundreds-of-thousands of supply savings opportunities are being missed because they are hidden in your general ledger. That’s why supply categorization, classifications, and interpretations are so critical with value analysis analytics.
- Cuts Your Waste and Inefficiencies by 7% to 15% Beyond Price: While price and standardization savings are a good thing, these savings only represent 3% (supply budget/annual savings) of a typical hospital, system, or IDN’s annual supply chain savings. That’s why to cut your waste and inefficiency in your supply budget to the bone you need new and better tools to effect this change. Below is a great podcast on how you can move your organization towards reduction of waste and inefficiencies. (https://svah-solutions.com/podcast-43-6-reasons-need-move-organization-towards-supply-utilization-management-now/)
To quote Amir Harel, general manager of visibility solutions at Zetes, “The goal of visibility is ultimately to gain better control and unlock (your) performance potential. As a platform for greater efficiency and network collaboration, it can be transformational. Without it, [corporations] will struggle to achieve the big wins associated with improvements in waste,…supplier performance and customer engagement.”
Below are some similar articles that you may find interesting.
Supply Waste and Inefficiency is Unchecked and Unchallenged at Most Healthcare Organizations
Want to see SVAH Solution’s Value Analysis Tools in Action? Fill out the no cost, no obligation walk-through review request below and a representative will be in contact with you today!