"Lean supply chain management". It sounds like a term exclusive to those in manufacturing and retail. Isn't that something big companies like Amazon have to worry about? Not hospitals like yours?
But it all comes down to satisfaction scores. In retail, bad customer reviews impact product sales. In hospitals, the stakes are much higher.
Patient satisfaction scores like HCAHPS influence reimbursement rates. Scores sway patient decisions about who provides their care. It makes it harder to recruit top physicians. All of this contributes to lost revenues.
Let's explore how lean supply chain management can improve these scores.
What Is Lean Supply Management for Hospitals?
Lean supply chain management entails streamlining often complex purchase operations. By doing so, you slash waste.
This waste comes in the form of:
Duplication of efforts among hospital staff
Overspending
Lack of essentials when patients need them most
Expensive rush orders
Unorganized systems not only influence patient satisfaction scores. They also impact facility morale, leading to:
Turnover
Lost productivity
More bad patient satisfaction scores
Lean supply chain management eliminates all of this.
Lean Supply Chain Management Cuts Hierarchical Waste
Within every hospital, people at various levels in the organization make buying decisions. Often, one hand doesn't know what the other is doing. Supply closets get filled in one part of the hospital. Those on the other side don't know the hospital already has what they need.
They order more.
Lean supply chain management establishes a clear purchase structure. It includes centralized inventory tracking. It avoids both the duplication of effort and the cost of warehousing excess supplies.
Some of these may have an expiration date.
All of this means you have what you need for the patient. Before you run out, you're alerted that it's time to re-order. Everything is tracked in one place.
That leads to better patient care.
Lean Supply Chain Management Streamlines Vendor Management
Your facility is working with many vendors. One department may be using company X while another is using Y. Often there's overlap. You could be working with fewer suppliers and getting better-negotiated rates.
A lean supply chain tracks and evaluates opportunities to streamline contracts. It helps you more efficiently manage contracts. It establishes one point of contact for each vendor.
This saves a facility money. Some of this savings gets passed down to patients through reduced costs. You have exactly what you need when you need it to provide the best patient experience.
Lean Supply Chain Management Effectively Manages Payments
Maintaining strong vendor relationships is essential to keeping patient satisfaction scores high. If vendors aren't getting paid on time, it generates animosity. If they're getting lost in a maze of bureaucracy, they feel that the hospital doesn't value their partnership.They're more likely to end contracts with less notice.
That leaves you scrambling to find a new vendor. You may have 2-3 secondary vendors who can fill in the gap for a time. But they may be unable to meet demand.
Lean supply chain management involves putting systems in place to ensure that vendors are paid on time, without fail. If you really value a partner, consider payment on delivery rather than payment when the invoice comes due. This is much easier to manage when you have a lean supply chain.
Lean Supply Chain Management Gives You the Power
In some cases, you may feel that patient satisfaction scores are out of your control. But this is one major area where you're in complete control. Streamline everything to cut costs and improve patient care. Keep those reimbursement rates high.
To learn more about lean supply chain management follow our healthcare blog.