The Ultimate in Business Intelligence is Having a Mature Supply Benchmarking System that Compare to Hospital Centric Volume Metrics
Benchmarking or the search for best practices inside and outside the healthcare industry has become even more important to your supply chain expense success, since your easy supply chain expense savings have already been achieved. Today, for a healthcare organization to continue their supply chain expense savings at a double-digit fast pace they will need to know where to look for these new and better savings opportunities. Hosptial Supply Chain Benchmarking is the only tool to help you do so!
Don’t waste your valuable and limited time on dry holes
We see too many hospitals, systems and IDN’s supply chain/value analysis teams spinning their wheels looking for savings that aren’t there. Take, for instance, the vice president of a large teaching hospital who thought there must be savings in his $25 million dues and subscription account, only to be shocked after many hours expended and months consumed in deep diving into this account, to discover there were no significant savings to be achieved!
No one in the healthcare supply chain today has time for dry holes, as this VP experienced, since it is a waste of your valuable and limited resources. We need to be like an expert marksman that will hit his or her targets dead center 98% of the time. This only can be accomplished with customized benchmarks that you establish yourself or work with an expert marksman* to develop.
High level benchmarking reports won’t get your savings job done
From what we have seen over the years, most healthcare organizations are provided high level (i.e. 30,000 feet) supply chain expense benchmarks by their group purchasing organizations that are worthless because they are either extremely imprecise or full of errors. It is these generic reports that have given supply chain expense benchmarking a bad name.
However, the only thing these generic benchmarks do provide you with is a hunting license Vs. customized benchmarks at your SKU level that are specific, exacting and actionable. If you decide to use these generic benchmarks, you risk losing the confidence of your department heads and managers when you search through their haystacks to uncover saving opportunities and then not to find any.
Why do you need customized benchmarks?
We all know what “off the rack” Vs. “custom-made” suits are like. The difference between “off the rack” is that one type fits all comers Vs. custom-made is an exact fit for you. This is the differentiation too between generic and customized benchmarking. The former is non-specific or vague while the latter is made-to-order or specific for your hospital, system or IDN’s requirements.
Naturally, then custom benchmarking is 98% more accurate than generic benchmarking by a mile. This is the kind of accuracy we need in today’s supply chain expense benchmarking. Otherwise, you will be like a blind archer who never hits the savings targets you are aiming for. It could be quite embarrassing!