III.3 End-to-End Supply Chain:

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  • Streamlined operations for charge capturing & supply requisitioning Saved $541K in lease expense through 12/31/01 Launched program to eliminate distribution fees saving $739K through 12/31/01
  • At a high level, these are the roles and responsibilities of HPG and Supply Chain Services. While these two are technically separate entities, they work together to get high quality, low cost products to our patients. HPG is the contracting arm of Supply Chain. They test products, get input from Advisory Boards made up of clinicians and subject matter experts from facilities, negotiate contracts and aid in implementation. Supply Chain has stream-lined operational processes for getting the contracted products to our physicians and patients. They are compartmentalized here into 4 buckets. The two areas that immediately touch our facility are Procurement and Delivery. We have a part of these processes and will see how we contribute in the following slides. You will see that our SMAT team is part of Product Education & Utilization. Notice that communication falls under HPG and Supply Chain. This does not mean that you will receive information from both; it means that HPG and Supply Chain work together to communicate one message to all hospitals. The roles highlighted in yellow represent those activities that take place in the facility.
  • III.3 End-to-End Supply Chain:

    1. 2. III.3 End-to-End Supply Chain: The Integration of People, Process, Technology and Location
    2. 3. End-to-End Supply Chain: The Integration of People, Process, Technology and Location Jay M. Kirkpatrick, CMRP Supply Chain Officer HCA MedAmerica Division Supply Chain Nashville, Tennessee Dave Catino Assistant Vice President Strategy & Planning – IT&S HCA Corporate Supply Chain Nashville, Tennessee Vivien Conner, CMRP Supply Chain Director Centennial Medical Center Nashville, Tennessee
    3. 4. Integration <ul><li>People </li></ul><ul><li>Process </li></ul><ul><li>TECHNOLOGY </li></ul><ul><li>Location </li></ul>
    4. 5. Why Shared Services? <ul><li>Supply Cost Rising at 8%-15% Annually </li></ul><ul><li>Labor Cost Rising </li></ul><ul><li>Technology Costs Rising </li></ul><ul><ul><li>Integration Issues with Technologies </li></ul></ul><ul><li>Variability in Process </li></ul>
    5. 6. Supply Chain Background <ul><li>Launched in January 2000 to: </li></ul><ul><ul><li>Protect HCA’s “Core” Business: Patient Care </li></ul></ul><ul><ul><li>Reduce Supply Cost </li></ul></ul><ul><ul><li>Increase Productivity </li></ul></ul><ul><ul><li>Improve Service </li></ul></ul>
    6. 7. Supply Chain Background <ul><ul><li>Three distinct components: </li></ul></ul><ul><ul><ul><li>Consolidate back office functions </li></ul></ul></ul><ul><ul><ul><li>Share supply cost reduction opportunities throughout the company </li></ul></ul></ul><ul><ul><ul><li>Work with the GPO in developing and optimizing division contracts for medical devices and standardization initiatives </li></ul></ul></ul>
    7. 8. HCA Supply Chain Strategy Supply Chain Operations Effectiveness Reduce Supply Expense Efficiency Reduce Transaction Costs <ul><li>Clinical </li></ul><ul><li>Focused on: </li></ul><ul><li>OR </li></ul><ul><li>Cath Lab </li></ul><ul><li>Pharmacy </li></ul>Manufacturer Point of Use Standardization Procurement Supply Standardization/ Utilization Warehousing Best Practices Utilization Contracting Substitution <ul><li>Supply Chain Operations </li></ul><ul><li>Consolidation of Procurement </li></ul><ul><li>Consolidation of Warehousing </li></ul><ul><li>Deploy Point of Use Technology </li></ul><ul><li>Supply Expense Management </li></ul><ul><li>Supply Improvement Program </li></ul><ul><li>Physician Preference Contract Model </li></ul><ul><li>Division Based Procurement </li></ul><ul><li>Freight Management </li></ul>
    8. 9. HCA Supply Chain Services BSS CDCs (Satellite Warehouses) New Orleans Kansas City New Orleans Atlanta Jacksonville Nashville Denver Salt Lake City Dallas Houston Tampa Miami Richmond El Paso Las Vegas Oklahoma City Charleston Portsmouth
    9. 10. HCA’s Integrated Supply Chain Clinical Operations National Regional Agreements System Operations Financial Operations Procurement Financial Roles HealthTrust Roles GPO Operations Supply Chain Roles Accounts Payable Logistics Product Standardization Utilization <ul><li>Product Evaluations </li></ul><ul><li>Testing </li></ul><ul><li>Technology Screening </li></ul><ul><li>Clinical Networking </li></ul><ul><li>National & Regional Negotiating </li></ul><ul><li>Sourcing </li></ul><ul><li>Legal </li></ul><ul><li>Sales </li></ul><ul><li>Implementation </li></ul><ul><li>Customer Service </li></ul><ul><li>Communications </li></ul><ul><li>Compliance </li></ul><ul><li>Contract Management </li></ul><ul><li>Standard Master Files </li></ul><ul><li>UPN </li></ul><ul><li>Classification </li></ul><ul><li>Accounting </li></ul><ul><li>Audits </li></ul><ul><li>Analysis and Reporting </li></ul><ul><li>Financial Support </li></ul><ul><li>Systems Support </li></ul><ul><li>Internal Controls </li></ul><ul><li>Requisitioning </li></ul><ul><li>Purchasing </li></ul><ul><li>Matching </li></ul><ul><li>Payment Processing </li></ul><ul><li>Accruals </li></ul><ul><li>Shipping </li></ul><ul><li>Receiving </li></ul><ul><li>Put Away </li></ul><ul><li>Replenishment </li></ul><ul><li>Distribution </li></ul><ul><li>Storage </li></ul><ul><li>SKU Standardization </li></ul><ul><li>Waste Reduction </li></ul><ul><li>SMAT </li></ul><ul><li>Appropriate Utilization </li></ul>HCA IT&S <ul><li>HCA IT&S </li></ul><ul><li>SMART </li></ul><ul><li>POU </li></ul><ul><li>WMS </li></ul><ul><li>EDW </li></ul><ul><li>GHX </li></ul>Our mission is to obtain the best price for clinically recommended products, ensure their timely delivery, and continuously evaluate and improve our services to the patients, physicians and clinicians we serve.
    10. 11. Supply Chain Core Operating Systems
    11. 12. In The Beginning…
    12. 13. Materials Management & Accounts Payable <ul><li>SMART – homegrown MMIS. Heart of Supply Chain Processing </li></ul><ul><ul><li>Order Management – Purchasing, Distribution, and AP </li></ul></ul><ul><ul><li>AIX platform </li></ul></ul><ul><ul><li>MicroFocus Cobol </li></ul></ul>
    13. 14. Materials Management & Accounts Payable <ul><li>Host Accounts Payable – homegrown system which receives vouchers from SMART AP and generates payments to vendors. </li></ul><ul><ul><li>Mainframe-Based, Cobol </li></ul></ul><ul><li>GE Information Systems </li></ul><ul><ul><li>Value added network for trading EDI documents </li></ul></ul>
    14. 15. Operational Advantages and Opportunities <ul><li>Pros </li></ul><ul><ul><li>Good Order Management System </li></ul></ul><ul><ul><li>EDI Connectivity </li></ul></ul><ul><ul><li>Mainframe AP Application </li></ul></ul><ul><li>Cons </li></ul><ul><ul><li>Variability in Setup and Operation </li></ul></ul>
    15. 16. First Steps
    16. 17. Point Of Use <ul><li>SupplyScan </li></ul><ul><ul><li>Partnered with McKesson in 1999 </li></ul></ul><ul><ul><li>Installed in all acute care facilities </li></ul></ul><ul><ul><li>Integrated with Meditech clinicals application </li></ul></ul><ul><ul><ul><li>ADT </li></ul></ul></ul><ul><ul><ul><li>Patient charging </li></ul></ul></ul><ul><ul><li>Integrated with SMART MMIS </li></ul></ul><ul><ul><ul><li>Item/PAR </li></ul></ul></ul><ul><ul><ul><li>Replenishment </li></ul></ul></ul><ul><ul><ul><li>Advance Ship Notice </li></ul></ul></ul>
    17. 18. Operational Advantages <ul><li>Automated Charge Process </li></ul><ul><ul><li>Cards, Stickers, Labor Hours Eliminated </li></ul></ul><ul><li>Nursing Satisfier </li></ul><ul><li>FTE Reduction </li></ul><ul><ul><li>Elimination of Count, Pull, Replace Process </li></ul></ul><ul><ul><li>Eliminate Keying Charges in MMIS </li></ul></ul><ul><li>Min/Max and Critical Levels vs. Top Off </li></ul>
    18. 19. CSC Consolidation Begins
    19. 20. Supply Chain Call Centers <ul><li>Symposium – an automated call distribution system that appropriately tracks and routes calls to specialized areas of support. </li></ul><ul><ul><li>Established multi-hospital customer service operation </li></ul></ul>
    20. 21. Supply Chain Call Centers <ul><li>Remedy – Call tracking and logging </li></ul><ul><ul><li>Log analysis - Enables root cause problem resolution </li></ul></ul><ul><li>Data Captured for Key Performance Indicators </li></ul><ul><ul><li>Hold times, Abandonment Rate, Logs Open > Week, % Rush Calls, % A/P Calls, % Purchasing Calls, % Warehouse Calls, Facility Call %, Vendor Call %, Call Logs, Open Call Logs Closed </li></ul></ul>
    21. 22. Operational Advantages <ul><li>Hospital </li></ul><ul><ul><li>One Point of Contact </li></ul></ul><ul><ul><li>Faster Resolution Timeframes </li></ul></ul><ul><ul><li>Issue Tracking </li></ul></ul><ul><li>Division </li></ul><ul><ul><li>Purchasing, A/P, and Warehouse Staff Process Without Constant Interruption </li></ul></ul><ul><ul><li>Defined Audit Trail of Issues and Resolutions </li></ul></ul>
    22. 23. Expanding Requisitioning & Supplier Connectivity
    23. 24. GHX <ul><li>Replaced GEIS </li></ul><ul><li>EDI Compliance – 88.5% </li></ul><ul><li>Statistics </li></ul><ul><ul><li>88 Supplier Divisions </li></ul></ul><ul><ul><li>$1.2 Billion in Volume </li></ul></ul><ul><ul><li>535,000 annual POs </li></ul></ul><ul><ul><li>2.9 Million PO Lines </li></ul></ul><ul><ul><li>450,000 Invoices (2005) </li></ul></ul><ul><li>Documents </li></ul><ul><ul><li>PO (850) </li></ul></ul><ul><ul><li>PO Confirmation (855) </li></ul></ul><ul><ul><li>Invoice (810) </li></ul></ul><ul><ul><li>Sales Tracing (867) </li></ul></ul><ul><li>Hosted by GHX </li></ul><ul><li>Functionality </li></ul><ul><ul><li>Special purchase requisitioning </li></ul></ul><ul><ul><li>Capital purchase requisitioning </li></ul></ul><ul><ul><li>Round trip w/ Dell </li></ul></ul><ul><ul><li>Stat Rec in development </li></ul></ul><ul><li>Interfaced with SMART MMIS </li></ul>Connect + Data Exchange Catalyst Requisitioning
    24. 25. Operational Advantages <ul><li>Facility </li></ul><ul><ul><li>Key Enabler to Move Purchasing Offsite </li></ul></ul><ul><ul><li>Approval Workflow and Visibility </li></ul></ul><ul><ul><li>Supports Standard Vendor Order Calendar </li></ul></ul><ul><li>Division </li></ul><ul><ul><li>SPR Interfaced in MMIS (SMART) </li></ul></ul><ul><ul><li>Reduction in Purchasing FTEs </li></ul></ul>
    25. 26. Warehouse Automation…
    26. 27. Warehousing <ul><li>Partnered with SSA (EXE) in 2000. </li></ul><ul><li>Software manages 4-walls of warehouse </li></ul><ul><ul><li>12 – 15 Hospitals Per Warehouse </li></ul></ul><ul><ul><li>Receiving, Put-Away, Picking, Shipping, Replenishment </li></ul></ul><ul><ul><li>Daily deliveries </li></ul></ul><ul><ul><li>RF technology (hand-held and wearable) </li></ul></ul><ul><li>Hardware Located in Regional Data Centers </li></ul><ul><li>SMART MMIS integration </li></ul><ul><li>Internal ASN via scanning at POU </li></ul>
    27. 28. Operational Advantages <ul><li>Integration to POU Min/MAX to Increase Picking Efficiency in Warehouse </li></ul><ul><li>Reduction in Picking Errors </li></ul><ul><li>Electronic Pre-adjusted Picking List </li></ul><ul><li>Advanced Ship Notice </li></ul><ul><li>Elimination of Hospital Storerooms </li></ul><ul><li>Disintermediation </li></ul>
    28. 29. Optimization!
    29. 30. Standardization and Imaging <ul><li>Item Management System </li></ul><ul><ul><li>Collapsed 3 systems into 1 </li></ul></ul><ul><ul><li>Houses standard Item and Vendor numbers as well as Contract Pricing </li></ul></ul><ul><li>Imaging </li></ul><ul><ul><li>Hyland On Base Imaging solution which is used for storage and retrieval of Purchase Order, Invoice, and Voucher information. Eliminates routing of paper throughout the division. </li></ul></ul>
    30. 31. Data Warehousing <ul><li>Supply Chain Data Warehouse </li></ul><ul><ul><li>Teradata platform </li></ul></ul><ul><ul><li>2.1 billion rows </li></ul></ul><ul><ul><li>Data mined and reported via Business Objects, VISTA, AdHoc </li></ul></ul><ul><ul><li>250,000 individual reports run against the EDW in 2005 shared between 11,000 distinct users </li></ul></ul>
    31. 32. Supply Chain Website <ul><li>SC Website (292,000 hits in 2005) </li></ul><ul><ul><li>2000+ pages of P&P, Business Flows, Forms (Business Standardization) </li></ul></ul><ul><ul><li>Supply Cost Management – Data and Information </li></ul></ul><ul><ul><li>SC Communications and Education (SCU) </li></ul></ul>
    32. 33. Operational Advantages <ul><li>Standardization </li></ul><ul><ul><li>Product and Process Standardization </li></ul></ul><ul><ul><li>Enabler to Warehouse Consolidation </li></ul></ul><ul><ul><li>200 to 12 to 1 </li></ul></ul><ul><ul><li>Cross Hospital Reporting Consistency </li></ul></ul><ul><li>Imaging </li></ul><ul><ul><li>Enabler to Accounts Payable Consolidation </li></ul></ul>
    33. 34. Nashville RDC Supply Chain Core Operating Systems Location Schematic D w e E e 3 Communication Server D w e E e 3 SQL DB Server D w e E e 3 Citrix Server D w e E e 3 Application Server D w e E e 3 EC Server WMS PC Workstation Laser Printer RDC Warehouse RF Scanner RF Access Points HCA Cloverleaf Meditech SMART Application Server Interface PC POU Facility Materials Management PC NurseStation POU Scanner Laser Printer Application/Web Servers Database Servers GHX Cloverleaf Vendor Site GHX PC Workstation Zebra Label Printer Sato Printer EDW Server Host (AP, GL) Mainframe RCS Mainframe Application Servers (2) Web Server IMS Database Server WMS SMART Master Tower Reports Servers Session Server
    34. 35. What’s Next? <ul><li>Optimization, Optimization, Optimization </li></ul><ul><li>Pharmacy </li></ul><ul><li>Cath Lab </li></ul><ul><li>Operating Room </li></ul>
    35. 36. Questions?

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