By Dee Stephens, Senior Clinical Consultant
Yesterday we had a plan on how to improve our supply chain process. We looked at supplier consolidation, our distribution models, how we move product, and how we could use data to streamline these processes.
Then came a little pandemic called COVID, and our focus changed. We became more concerned with how we were going to provide the minimal supplies needed to perform basic care. Personal protective equipment (PPE) was at a premium, and everyone was scrambling. Survival was the goal, and worker and patient safety a must. They call it a “black swan” event: A catastrophic happening that was a surprise and disruptive. The problem is we already knew we were unprepared and at the mercy of weather, market forces, and natural resources. We had a dry run of loss of factories providing intravenous fluids, changing suppliers without understanding the consequences, and delivery models that weren’t working. But we continued to test the definition of insanity.
Today we struggle with all aspects of the supply chain process. The pandemic has hit all the soft spots of the supply chain, from procurement and transport of raw goods to how we rethink our inventory. “Just in time” may not be the right time for the present or the future. History has shown that we have a delay when we have a shift in the process, which means we expected disruptions in the supply chain but not to the extent that we saw. With no ability to forecast the current and future state of COVID, our supplies couldn’t meet the demand. We must rethink the complete process from beginning to end. How can we learn from this event and improve our tomorrow?
We must look for alternative sources of materials, be they raw or manufactured. We must look at how goods are delivered and begin thinking about bringing more manufacturing back from overseas. Many of the original reasons for offshoring, i.e., cheaper labor and goods, have been diminished by increased fuel prices and labor costs. We will see a distancing from just-in-time inventory to keeping more product on-hand to meet surges in demand. All this needs to occur in a disruptive environment as costs are up while revenues have plummeted. We must reduce cost model, use data to drive forecasting, and stabilize the efficiencies to move toward a healthier space.
We at Catalyst through the use of accurate and actionable data can assist you in evaluating the state of your current supply chain. Do you have a good grasp of your current inventory? Do you have a mechanism in place to look at consumption vs. purchase? How can you develop better forecasts? Through the use of national benchmarking and standards, we can develop actionable supply chain dashboards along with operational consulting to assist in preparing to move forward.