Healthcare Supply Chains Changes Due to COVID-19

Healthcare Supply Chain Changes Due to COVID-19

Jan. 26, 2021
The combination of hindsight and data-driven insight will make all the difference in driving the kind of resilient supply chain healthcare so desperately needs.

Never has the adage “hindsight is 20/20” rung so true. As we look back on the past year, it’s paramount that we learn from our mistakes and share best practices. In fact, the Healthcare Leadership Council (HLC), an alliance of leaders from all sectors of U.S. healthcare, and the Duke-Margolis Center for Health Policy are collaborating on a 2021 report about applying lessons learned from the pandemic. Among them is the importance of data to power the healthcare supply chain and improve patient care. While there’s certainly no lack of data in healthcare, for manufacturers it’s about accessing and applying the “right” data to support real-time decisions that impact outcomes, cost and quality.

The right, trusted data helps identify and address potential supply shortages before they impact patient care. It supports collaboration among stakeholders, resulting in greater supply chain resiliency. And ultimately, it can provide insight needed to make smarter, faster decisions.

Over the past year, the importance of applying the right data was at the heart of discussions among manufacturers solving for the need to produce and source more personal protective equipment (PPE), and other critical supplies.

Among the lessons 2020 has taught the healthcare industry, we’ve recognized data that supports forecasting, planning and collaboration allows manufacturers to get ahead of potential shortages well ahead of a crisis. Arguably, manufacturers have been mining this data for some time, but three new strategies have emerged that take supply chain data management to the next level.

1. Centralize Forecast Data and Align with Delivery of Care Needs

Accurate forecasting data is essential to getting ahead of potential shortages, in tandem with rightsizing and moving inventory based on projections of product demand. Today, this is a constant process of projecting demand and tweaking forecast scenarios while factoring in the cost of inventory, time and transportation. Going forward, forecasting will be more accurate when all healthcare stakeholders can collaboratively model patient outcomes and the delivery of care needs with data about product quality and cost. The data is even more powerful when it allows the industry to also drill down on cost based on geography.

Manufacturers that look at forecasting data in combination with their healthcare client’s requirements to deliver care effectively and efficiently will be better equipped to anticipate customer and partner needs. They’ll also do better at avoiding unexpected demands, especially during peak seasons or crisis situations, and have better tools to spot trends to capitalize on growth opportunities.

2. Put Data in the Hands of All Critical Stakeholders

To elevate strategic planning, look beyond transactional data to include insights across the supplier network. Specifically, extend visibility to include more stakeholders in the organization and beyond the manufacturer’s walls. This includes partners, healthcare providers, government entities and other suppliers. Providing greater, industrywide transparency results in better control of production and the flow of goods, benefitting everybody.

Even before the pandemic, researchers at the MIT Sloan School of Management reported that increasing supply chain visibility is an effective way for companies to build trust with customers ­– and, in certain cases, can lead to higher sales.

More recently, we’ve all seen how greater visibility works in real time, especially during the pandemic’s heaviest waves. Having confidence that supplies can be quickly located and sourced from trusted vendors has been at the crux of decision-making over the past year. Greater visibility and transparency throughout the supply chain is the way to better manage a healthcare crisis.

3. Collaborate to Determine Optimal Care Delivery Needs

The third strategy, and next logical step, is to leverage transparency for greater industry-wide collaboration. Collaboration enables a bigger-picture view that results in a more resilient supply chain while optimizing the delivery of care for each patient.

Imagine the upside of collective insight when it comes to responding to shifting demands for hospital equipment to treat COVID-19 patients. This includes emergency needs such as ventilators and remote monitors, as well as long-term needs like at-home care kits and greater quantities of syringes for vaccinations. There will also likely be many longer-term COVID-19 needs that are still undetermined as healthcare continues to learn more about the virus. 

In addition, data and collective insight can be used to match products with specific patient needs. For example, instead of one-product-fits-all, we can move closer to personalized care by identifying a specific product that’s been proven to work most effectively on a certain patient population. There’s no doubt this evidence-based approach to personalized care is the future of healthcare.

Never before has data-driven insight into what could happen and will happen in the healthcare supply chain been so important. Armed with the right data, manufacturers can be more flexible and quickly transition, especially during a crisis. This combination of hindsight and data-driven insight will make all the difference in driving the kind of resilient supply chain healthcare so desperately needs.

Denise Odenkirk is vice president, GHX.

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