The COVID-19 pandemic has produced challenges for supply chains across almost every industry, but the implications of its impact on the healthcare sector are particularly significant. Bill Brewer, RF-SMART’s Oracle Cloud Healthcare Product Manager, uses his 15 years of healthcare supply chain experience to analyze and suggest ways you can increase healthcare supply chain efficiency during this critical time.
Q: How has the pandemic impacted the Healthcare sector?
We don’t fully know the answer to this question yet. Firstly, it's important to recognize the sacrifice and tremendous amount of work that everybody involved in the healthcare continuum, both supply chain and front-end, continues to do every single day.
In terms of the impact on the broader healthcare industry, as we get through this, the healthcare industry will step back and start to really re-evaluate a lot of things. And one of the largest areas to look at is how to better manage for demand. Be it people, supplies, whatever the case might be, how do you do a better job in the future of predicting and responding to that demand?
Q: How has the pandemic impacted supply chain specifically?
Perhaps the most obvious example is PPE (Personal Protective Equipment) and how you can better manage it. If you go back to the early part of 2020, as COVID began to rave mainland China, we saw the initial steps of a disruption to the supply chain. We began to see plant closures there and ports shut down. And so even before COVID took forward in the US, we were already dealing with shortages of things like surgical gowns because of the upstream impact that had happened with the global supply chain. Once COVID hit the US, the demand went up, and it was the perfect storm that came together.
So one thing that you have to step back and evaluate is when you think about how you manage supplies and inventory in the healthcare industry, it's largely a transactional enterprise. You bring supplies in, you move them around the facilities, you use them, and then you rinse and repeat the same process. And so whether it’s PPE, ventilators, whatever the case might be, that strategy may have served you in the past, but it's not going to serve you in the future. You now have to look at how you can better plan for these things, and how you make investments in the right systems, processes people to make sure that you don't find yourself in that place again.
Q: As we evaluate and look ahead, what are your predictions for the future of the industry and of supply chain?
Planning is a very, very big part of that. When you think about something as simple as inventory management, for example, how do you manage a product, where it sits, how it comes into the facility and how it gets distributed out? One example that a healthcare provider in the depths of working through COVID-19 shared is that every single day, they were having their front line staff go out and manually count where all of their masks, gloves and gowns were at, and were manually compiling the data in Excel spreadsheets. While that serves the need, you have to move the needle to a much more strategic supply chain in healthcare because that is how you're going to improve.
And so there are examples of demand planning, automation, things that work in other industries, and ultimately the right ERP system as well. At the end of the day, if you're working with antiquated systems and you don't have ways to automate your supply chain, then you're going to struggle.
The other (more broad) thing is that anyone that's spent any time in the healthcare industry knows one mantra: Your are always asked to do more with less. One of the impacts of the pandemic on the healthcare industry is that you've seen tremendous cuts in staff on the front lines or taking care of the facilities. In some cases, there are 50%-60% of the workforce taking care of patients in hospitals that had to furlough their staff. And so the question also has to become, how do we do more with less? That will cause you to step back and think about some strategies to do just that.
Q: What are some ways we can build a stronger healthcare supply chain?
Firstly, it includes involving everybody in the supply chain. You need to bring both distributors and suppliers to the table, as this is not just a provider-side problem. A great example is that distributors work through the system of "allocations" - this is a methodology by which you say “Provider A is going to get X amount of product, Provider B is going to get Y amount of product," and so on. The reality is that this hasn't served the industry extremely well during the pandemic, and so it's examples like this can be be improved on.
In regards to doing more with less, what you really have to do is reduce touch points. because you touch and move and transact a lot in healthcare.
You also have to improve tracking and managing inventory, because you need to know where it is, and what the demand is. That may be an investment in a cutting edge cloud ERP system, or inventory management and automation technologies like RF-SMART, where you can automate things like receiving inventory counts. Ultimately, you have to become much, much more efficient. And the only answer to that is through technologies and solutions to do that.