iHT² Health IT Summit New York - Mark MacNaughton, SVP & CIO, Medial Segment at Cardinal Health  - Keynote Presentation “Information as an Asset - Moving From the T Side of IT to the I”
 

iHT² Health IT Summit New York - Mark MacNaughton, SVP & CIO, Medial Segment at Cardinal Health - Keynote Presentation “Information as an Asset - Moving From the T Side of IT to the I”

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iHT² Health IT Summit New York - Mark MacNaughton, SVP & CIO, Medial Segment at Cardinal Health - Keynote Presentation “Information as an Asset - Moving From the T Side of IT to the I”

iHT² Health IT Summit New York - Mark MacNaughton, SVP & CIO, Medial Segment at Cardinal Health - Keynote Presentation “Information as an Asset - Moving From the T Side of IT to the I”

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  • Cardinal Health is committed to using our deep understanding of healthcare to deliver inventive and meaningful and solutions that make healthcare more cost-effective. As a result, our customers have more time to focus on what matters most – their patients.
  • Cardinal Health is a multi-billion dollar healthcare services company. Actually, we like to say we ’re the business behind healthcare because we focus on making it more cost-effective so our customers can focus on their patients. We work with pharmacies, hospitals, doctor’s offices, surgery centers and clinical labs- basically anywhere healthcare services are offered. As a leading provider of products and services in the healthcare supply chain, we have the broadest view of healthcare in the industry: We have more than 30,000 employees with direct operations around the world We deliver products and services to 40,000 customers at 60,000 locations daily 86 percent of hospitals in the U.S. use Cardinal Health products and services We supply pharmaceuticals to fill 25 percent of branded prescriptions in the U.S. In fact, a third of all distributed pharmaceutical, laboratory and medical products in the U.S. and Puerto Rico flow through the Cardinal Health supply chain. We are proud to be #19 on the Fortune 500 list
  • Healthcare is an extraordinary place to be Very few industries know that demand has to increase Aging population Public health issues such as chronic diseases And domestically, the affordable care act The demand is clearly going to be there – the question for us as a society, and as an industry, is how do we improve cost effectiveness so that we can afford this ever-increasing demand.
  • Our position within healthcare is very unique. We have the broadest perspective of the entire healthcare system by looking across medical and pharmaceutical manufacturers to acute care, ambulatory care and retail providers. This view allows us to understand the increasing complexity of activities across the entire continuum of care. We also focus in on each customer segment and class of trade. We have greater, deeper understanding of our customers' needs, issues and pain points. We are in the physician ’s office, the lab, the hospital, the pharmacy and the retail business. We improve the total cost of healthcare. We do this not only by efficiently managing a complex supply system, but also by improving quality, helping to reduce errors and effectively aggregating supply and demand. The by-product of this is that we are able to give providers more time to focus on caring for their patients while we focus on the supply chain.
  • -The world that many of us grew up in with distinct participants in healthcare is blurring. -In order to improve outcomes and cost-effectiveness, we know that care will need to be delivered in the most appropriate setting, at the most appropriate time, by the most appropriate caregiver. At the same time, that care delivery must be provided in a coordinated way. The white space between the discreet activities is disappearing. This is why we have positioned our business to serve the patient all along the continuum of care.
  • Tagging high value inventory Real-time Hospital Visibility solution Suppliers can see what they have on location at the hospital and are able to minimize counting and audit work done by the sales representative. This is because the cabinet does the entire inventory counting and reporting for the suppliers. Smart Cabinet takes 20,000 full inventory counts per year, automated and continuous rapidly detect trends, analyze and act on field inventory information. The goal is to ensure that the right products are on the shelf at the right time and in the right amounts, while substantially reducing the costs of holding and managing inventory Pushing data up to suppliers improves the view of what products are moving and what aren’t
  • Product availability and purchasing information leads to ability to allocate Figures are pharma only Goal: Mitigate impact Communication + coordination are key : early-as-possible, consistent, accurate information about product shortages, from manufacturers and/or FDA. Cardinal Health role : Dynamically allocate available product to providers; Communicate available information to customers; Protect supply chain integrity. What we do Work with manufacturers to get product availability information as soon as it available , so we can immediately notify customers. Scorecards that measure quality of communication Regular communication, monthly reviews to discuss gaps Daily updates to customers. Dynamic allocation system: sophisticated process allocates product to customers based on past buying behaviors. Make product available to customers as soon as we receive it . Manage inventory of alternate items in anticipation of demand shifts. Leverage National Logistics Center, highly responsive distribution network to quickly get product to those in need. Industry needs to better communicate what products are expected to be in short supply, when + for how long. Speed, accuracy and consistency of product shortage information needs to improve. Need: More standard definitions needed for when product is in short supply. Access to more consistent information around shortage timing + duration. FDA, AHRQ, ASHP, other appropriate clinical entities should consider collaborating to identify alternatives when medications are in short supply. Do you have a heads-up when these shortages are about to occur? Do you prepare your customers? We work closely with manufacturers to get accurate product availability information and advance notice when they believe product shortages are likely to occur.   However, many disruptions occur rapidly, with little advance notice.  We have enhanced our processes to increase the responsiveness when we learn of disruptions from suppliers or other market indicators since an initial disruption can quickly grow, impacting multiple products and suppliers.   Can you explain more about your dynamic allocation system? When a specific product is in short supply, our fair allocation system helps guard against any one, or group, of customers ordering dramatically larger quantities than they have in the past.  When products are in short supply, we receive product allocations from manufacturers, based on our customers’ past buying behaviors. We have enhanced our system to dynamically adjust the allocations based on the amount of product available, based on each customer’s purchasing history and trends. 
  • Signature Savings Project Quickly analyze large data sets Identify competitive advantage/ opportunities Provide consumable, data driven information for decisions
  • Current investment approach leverages costlier platforms. Investments made in outer circles are still relevant and required but need not be the default investment choice
  • On the road to analytics maturity, you must have all three parts of the puzzle to achieve the ability to predict Data analyst career roadmap Entry level path and compensation Data scientists – incorporating insight into the workflow Lead to predictive modeling and patterning Our Analytics & Information Management Function is responsible for analytic data platforms and access, design and implementation of reporting/business intelligence solutions and the application of advanced quantitative modeling. Create a center of excellence Create partnerships
  • Why it’s important to your business: Market conditions now make a single view of the customer more important than ever Need to reach a mutual understanding of what the business needs to do with the data Once you are aligned, everything moves toward the target more effectively Your assets are revenue opportunities if leveraged properly Build your data skill resources Make data and analytics a core competency Support with recruiting, retention and development Have the right partners Create space for experimentation IT geared toward getting solutions into production Need to encourage playing with data – not the traditional approach Start with small successes where there’s interest in big data and then counting on those wins / those stories of ROI to drive ‘viral’ use and demand for analytics internally
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iHT² Health IT Summit New York - Mark MacNaughton, SVP & CIO, Medial Segment at Cardinal Health  - Keynote Presentation “Information as an Asset - Moving From the T Side of IT to the I” iHT² Health IT Summit New York - Mark MacNaughton, SVP & CIO, Medial Segment at Cardinal Health - Keynote Presentation “Information as an Asset - Moving From the T Side of IT to the I” Presentation Transcript

  • © Copyright 2013, Cardinal Health. All rights reserved. CARDINAL HEALTH, the Cardinal Health LOGO and ESSENTIAL TO CARE are trademarks or registered trademarks of Cardinal Health. Information as an asset: Moving to the I-side of IT Mark MacNaughton SVP, CIO, Medical Segment September 19, 2013
  • © Copyright 2013, Cardinal Health. All rights reserved. CARDINAL HEALTH, the Cardinal Health LOGO and ESSENTIAL TO CARE are trademarks or registered trademarks of Cardinal Health. Cardinal Health - Essential purpose We are more than 33,000 people applying our deep understanding of healthcare to deliver inventive and meaningful solutions that help improve the cost-effectiveness and quality of healthcare so our customers can focus on patients. 2
  • © Copyright 2013, Cardinal Health. All rights reserved. CARDINAL HEALTH, the Cardinal Health LOGO and ESSENTIAL TO CARE are trademarks or registered trademarks of Cardinal Health. Essential facts 100+ business acquisitions across our history 100,000 sites delivered to daily 3 *An estimate of the pro forma revenue for fiscal 2013 in accordance with generally accepted accounting principles with adjustments expected to reflect each company as a stand-alone entity. The estimate is based on assumptions that management currently believes are reasonable, but actual revenue may vary materially from the estimate. Leading provider of products and services across the healthcare supply chain with an extensive footprint across multiple channels $101B FY13 pro forma revenue* #19 on Fortune 500 list 86% of hospitals in the U.S. use our products and services
  • © Copyright 2013, Cardinal Health. All rights reserved. CARDINAL HEALTH, the Cardinal Health LOGO and ESSENTIAL TO CARE are trademarks or registered trademarks of Cardinal Health. Aging population + Public health issues = Increased demand 4 Healthcare demand – an inescapable reality Need for improved cost effectiveness
  • © Copyright 2013, Cardinal Health. All rights reserved. CARDINAL HEALTH, the Cardinal Health LOGO and ESSENTIAL TO CARE are trademarks or registered trademarks of Cardinal Health. Healthcare trends Reimbursemen t cuts creating financial pressure for our customers Information transparency and interoperability / flow Consumers increasingly knowledgeable and involved in their healthcare Our priorities are driven by key trends in the healthcare marketplace… 5 Focus moving from purely unit price pressure to utilization Customers under overwhelming pressure and seeking creative, integrated solutions Reimbursement cuts creating financial pressure for our customers Focus moving from purely unit price pressure to utilization Customers under overwhelming pressure and seeking solutions Information transparency and interoperability/ flow Consumers increasingly knowledgeable and involved in their healthcare Increased participation of government in healthcare, both as a payor and a regulator
  • © Copyright 2013, Cardinal Health. All rights reserved. CARDINAL HEALTH, the Cardinal Health LOGO and ESSENTIAL TO CARE are trademarks or registered trademarks of Cardinal Health. Complex care delivery InsuranceInsurance PayorPayor ManufacturerManufacturer Home healthcare Physician offices Hospital systems Hospitals Surgery centers Independent laboratories Pharmacy Imaging GovernmentGovernment GPOGPO IDNIDN ACOACO
  • © Copyright 2013, Cardinal Health. All rights reserved. CARDINAL HEALTH, the Cardinal Health LOGO and ESSENTIAL TO CARE are trademarks or registered trademarks of Cardinal Health. Information transparency Radio-frequency identification (RFID) allows for tracking at transaction stations across the supply chain
  • © Copyright 2013, Cardinal Health. All rights reserved. CARDINAL HEALTH, the Cardinal Health LOGO and ESSENTIAL TO CARE are trademarks or registered trademarks of Cardinal Health. Pharmaceutical supply chain solutions Cardinal Health Pharmaceutical Manufacturers • 1,400+ manufacturers • 50,000+ products •22 distribution facilities •7.4 MM deliveries/year •>80% of generic injectables sold to hospitals are governed by ‘contract’ price Health Care Providers • 24,000 retail pharmacy locations • 2,650 hospitals • 4,000+ physician office and surgery center locations • 150 mail order locations
  • © Copyright 2013, Cardinal Health. All rights reserved. CARDINAL HEALTH, the Cardinal Health LOGO and ESSENTIAL TO CARE are trademarks or registered trademarks of Cardinal Health. Cost relief Critical components Product launches Proposal analysis Workflow Product cross- references Pricing Product data Buying patterns 9 Big data “Market Basket” analysis Big data “Market Basket” analysis Signature Savings PackageSignature Savings Package
  • © Copyright 2013, Cardinal Health. All rights reserved. CARDINAL HEALTH, the Cardinal Health LOGO and ESSENTIAL TO CARE are trademarks or registered trademarks of Cardinal Health. Data platform that supports insights Increasingcost Large, integrated data analytics Larger, more specific relational Big Data Central repository 10 In memory database Small to medium relational
  • © Copyright 2013, Cardinal Health. All rights reserved. CARDINAL HEALTH, the Cardinal Health LOGO and ESSENTIAL TO CARE are trademarks or registered trademarks of Cardinal Health. 11 Data skills that lead to insights Platform Relevancy Skills Insight Use of Business Analytics BusinessAgility
  • © Copyright 2013, Cardinal Health. All rights reserved. CARDINAL HEALTH, the Cardinal Health LOGO and ESSENTIAL TO CARE are trademarks or registered trademarks of Cardinal Health. Lessons learned • Ensure IT and business are aiming at the same target • Analytics are only as good as your data geeks • Building the future? Start in a sandbox • Start with fertile ground to grow advocates
  • © Copyright 2013, Cardinal Health. All rights reserved. CARDINAL HEALTH, the Cardinal Health LOGO and ESSENTIAL TO CARE are trademarks or registered trademarks of Cardinal Health. Q&A