Successfully reported this slideshow.
We use your LinkedIn profile and activity data to personalize ads and to show you more relevant ads. You can change your ad preferences anytime.

UPMC-Prodigo Panel Discussion at AHRMM 2009 - Tampa

1,246 views

Published on

Prodigo Marketplace is the healthcare industry's most efficient platform for content management. Proven at UPMC, the marketplace drives compliance, automation, user adoption, and improved data quality.

Profile
----------------
About Us: Prodigo Solutions is focused on driving savings in the healthcare supply chain. Created by healthcare supply chain professionals, the company's suite of solutions and services drive compliance, automation, data quality and user adoption.

Prodigo Solutions, LLC is an operating division of UPMC's International and Commercial Services Division. Visit www.prodigosolutions.com and www.upmc.com.

Published in: Health & Medicine, Technology
  • Be the first to comment

UPMC-Prodigo Panel Discussion at AHRMM 2009 - Tampa

  1. 1. Extend Your ERP – Lessons from a $8B IDN
  2. 2. Opening Remarks Jack Colletti CEO, Prodigo Solutions, LLC
  3. 3. Prodigo Solutions is focused on driving savings in the healthcare supply chain. Launched by healthcare supply chain professionals, the company's suite of solutions and services drive compliance, automation, data quality and user adoption.
  4. 4. Typical Environment Internet Supplier Connections Item ~15% ~85% Master of Transactions of Transactions 5
  5. 5. Background Bob Pavlik Director, Non-Clinical Sourcing
  6. 6. UPMC Profile • Leading integrated health care system in Pennsylvania; one of the largest and most diverse in the nation • 48,000 employees; second largest employer in Pennsylvania • Hospital – 20 tertiary, community, and specialty hospitals • Physician – more than 4,000 physicians with privileges at UPMC hospitals including about 2,300 employed • Community Provider Services – extensive network of rehabilitation, home care and senior services • Insurance – products covering commercial, Medicare and Medicaid segments, EAP, Behavioral Health (1.3 million covered lives in Health Plan)
  7. 7. How we stack up?
  8. 8. Supply Chain Profile •Centralized Operation Key Systems •$1.8 billion in spend •Process 4000+ Purchase requisitions per week •Process 70,000+ invoices per month •Receive 1.1 million+ packages per year through a central distribution center •Manage over 600 point of consumption material carts •Manage 30+ value analysis teams
  9. 9. Non-Clinical Team Spend Overview Overall Team Spend Spend Corporate Admin Services $452,622,000 Information Technology $206,000,000 Facitilities, Construction, & Dietery $362,789,000 $1,021,411,000
  10. 10. Non-Clinical Sourcing Team Transformation • Sourcing organization that is driven by internal customer’s business goals and objectives – Commodity Council approach – cross functional teams, executive sponsorship, etc.. • Utilizes a structured sourcing methodology • Integrated organization from vendor selection through order placement – Stronger sense of ownership when implementing contract • Better accuracy will reduced match exceptions and returns – Can be more proactive with career management • Clear path from Sourcing Specialist to Commodity Manager – Can be more creative with regards to resource management • Split time between sourcing and order placement, etc. • Leverage technology to reduce transactional work – True North = 100% lights out – Use efficiency gains to off set workforce reductions – Move tactical FTEs to sourcing
  11. 11. 18 Month Staff Impact Sourcing Operations Total Jan-08 8.5 13.5 22 Jul-09 9 10 19 Increase/Decrease 6% -26% -14%
  12. 12. Technology Impact Total eligilble eMarket Lines Lights out lines Current Vendor Go-live Date Lines # % # % Run Rate Intercontinental Subscription Service Jan 9 2009 145 145 100% 143 99% 99% Software House May 9 2008 1,067 255 24% 0 0% 0% Airgas Mar 7 2008 554 435 79% 0 0% 0% Worldwide Technologies Feb 26 2008 5,385 2,438 45% 678 13% 32% Grainger Feb 19 2008 6,537 5,621 86% 5,055 77% 77% WorkflowOne Oct 17 2007 45,209 44,043 97% 43,624 96% 96% Jeter Sep 13 2007 4,951 3,859 78% 660 13% 84% BatteriesPlus Oct 9 2007 382 197 52% 127 33% 53% Franklin Interiors Oct 10 2007 2,674 435 16% 118 4% 13% Corporate Express May 30 2007 331,362 326,993 99% 311,076 94% 97% 398,266 384,421 97% 361,481 91% Next opportunities: •Dietary (Sysco & GFS)
  13. 13. Workflow One Category Recap Overview Inventory Products 1,323 items Inventory Value = $ 975,363 Print On Demand 3,010 items Coordinate Options in UPMC Print Shop OMS Program 47 Suppliers 2008 Annual Activity Value = $ 2,723,378 Stationery Program 8,167 Orders 2008 Annual Activity Value = $ 629,495 Promotional Products 428 Orders 2008 Annual Activity Value = $ 498,617 ePro Orders 81% Usage 2008 Annual Requisitions = 13,360 Requisitions via ePro accounted for 81% of activity (96% lights out) Reduced work load from 2 FTEs to .5 FTEs Match Exception Improvement
  14. 14. Staples / Corporate Express Month Oct 2008 Nov 2008 Dec 2008 Oct 2009 Nov 2009 Dec 2009 Metrics Total Purchases $1,155,305.61 $938,648.63 $997,605.77 $833,603.39 $801,576.67 $824,456.72 Total Returns & Credits $48,627.01 $109,941.01 $47,976.72 $17,405.62 $17,248.61 $16,418.60 Total Net Purchases $1,106,678.60 $828,707.62 $949,629.05 $816,197.76 $784,328.05 $808,038.13 Avg Order Size $154.71 $155.76 $160.61 $156.65 $149.45 $149.46 Avg Lines Per Order 3.53 3.58 3.51 3.44 3.42 3.45 % CEB of Net Purch. 38.59% 38.44% 37.09% 18.47% 19.57% 18.82% % Electronic of Net Purch. 89.34% 91.63% 93.35% 97.41% 97.45% 97.05% % MWBE of Net Purch. 14.34% 14.17% 14.41% 18.67% 21.33% 20.00% % CEXP Catalog Fill 93.01% 92.87% 93.80% 86.22% 86.93% 85.78% % Total Returns/Credits 4.21% 11.71% 4.81% 2.09% 2.15% 1.99% # of Orders Placed 7,428 5,563 6,153 5,292 5,343 5,491 # of Order Lines 26,220 19,941 21,583 18,191 18,277 18,965  Requisitions via ePro accounted for 97% of activity (97% lights out). Reduced work load from 1 FTEs to .25 FTEs Match Exception Improvement Better catalog control Increased MWDBE business (improved business compliance and improved reporting) 15
  15. 15. Executing the Strategy Jeff Andersen Manager, Consulting Services
  16. 16. Supply Chain Profile Enterprise-wide Stakeholders • Sourcing – implement contracted savings & improve data quality • Accounts Payable – minimize Matching Exceptions • Purchasing – focus on value-added transactions only • Materials Management – reduce product returns • CFO’s – ensure spend compliance • CEO’s – maximize user efficiency/redistribute resources • Business Unit Leadership – improve ease-of-use • Department Users – “we want content too!…”
  17. 17. Supply Chain Profile Ingredients For Success •Platform •Supplier Ramp •User Experience •Leverage PeopleSoft ERP Investment •Low TCO
  18. 18. A Look Back… 2 Yrs. Ago Internet Supplier Connections Ad-hoc Special Item ~15% Master of Transactions Requests ~85% of Transactions 19
  19. 19. Content is King! UPMC Implemented in mid 2007… 2008/2009 = tremendous supplier ramp 21
  20. 20. On the Horizon eMarketplace isn’t solely for external suppliers! Catering Print Shop Coming soon: Medical Media Services Telecom
  21. 21. Resources Maintenance & Growth was/is inexpensive • Catalog Manager = 1 FTE • IT Resources (post-integration) = None • EDI Integration Manager = 0.5 FTE
  22. 22. Results Data User Compliance Automation Management Experience Drive more spend Reduce special Streamline item Realize extensive under management requests and enable master process savings and with improved touchless (no buyer) management, and increased user contract compliance purchasing, and improve UNSPSC adoption. and rapid improve overall quality. enablement of key connectivity with suppliers and your supplier base. punchout suppliers.
  23. 23. Success Story Solution UPMC implemented the eMarketplace solution as a Background single connection from PeopleSoft ERP. The supply UPMC had grown from $2b in revenues to chain group then began a systematic onboarding of over $7b in 10 years. Despite having a major punchout suppliers and hosted supplier catalogs. ERP system in place, contract compliance Further, UPMC integrated the Item Master file was below 20%, special requests and maverick (60k+items; 850 suppliers) into the eMarketplace. spending was rampant, and the growing user base and supplier base was compounding the Results issue. 24 months post implementation: •UPMC is fully deployed at 20 locations (including Corporate) Decision Points •Transaction level: 340,000 (past 12 months) •Compliance: 50% increase in contract compliance In early 2007, UPMC made the decision •Automation: 15% increase ; currently 40% of total purchase (after a thorough technology review) to transactions are “touchless” (estimate $30 savings per implement eMarketplace technology as an transaction). enhancement to the existing PeopleSoft •Process: 33% reduction in time spent on placing orders. eProcurement module. Also, UPMC experienced a 40% reduction in time spent on item master management. 25
  24. 24. Metrics Tell the Story: Leveraging Best Practice in Pursuit of “World Class” Increase “Lights Out” (automated transactions) to remove tactical FTE’s Every 5% Increase Represents a FTE Increase eMarkeplace transactions from 15% to 68%  Contract Compliance Benefit & FTE Impact
  25. 25. Results Results of Deployment • Eliminated Paper Disbursement Requests • Eliminated Paper Requisitions • Eliminated 60% of faxed/phoned PO’s to supply base and working toward 100% Hard Impact • eVoucher eliminated 4 FTE’s in the AP Entry Group • eProcurement/eMarketplace eliminated 6 FTE’s that comprised the SCM Pre-Key Group • Allowed for the reduction or limited the need to hire 15.31 FTE’s and counting as eMarketplace and “Lights Out” programs expand……… Soft Impact • Efficiencies gained with supply base • Efficiency & effectiveness of remaining Procurement Operations staff • Increased control through automation & interfaces: PO spend rogue (limit use of P- Card, Flat File Invoice & Blanket PO) spend
  26. 26. What’s Next? UPMC is removing all paper based invoices. “According to a recent survey, the healthcare industry is at least 15 percent behind other industries when it comes to automation.” – Healthcare Finance News “Hospitals are about five years behind non-healthcare industries in terms of adoption of paperless invoice processing. Of the survey respondents, more than 70 percent of the hospitals received in excess of 80 percent of their invoices in paper format. As a result, they said resolving matching errors and exceptions were their most challenging tasks.” – PayStream Advisors, a Charlotte-based research and consulting firm
  27. 27. The Future: Accelerate Benefit Capture  Continue aggressive push to access supplier hosted (and local) content through single eMarketplace punchout  Incorporate services & internal purchases (telecom, print services) into eMarketplace  Add more direct connects through eMarketplace for “configurables” (furniture, clinical equipment, catering)  Leverage content and supplier enablement to drive back-end Procure-to-Pay automation (ERS, Assumed Receipt, ASN Receipt etc.) Lights Out  Perfect Order  Segment Supply Base and funnel toward appropriate automated flowpath – using the PeopleSoft SRM suite as the foundation
  28. 28. Q&A Session
  29. 29. Contact Information Janette “J.P.” Perretta Director, Sales & Marketing 703.574.4479 (office) 412.445.8096 (cell) JP@prodigosolutions.com www.prodigosolutions.com

×