Data is the New Supply Chain Currency in the 21st Century
As more and more supply chain professionals are scrambling to save even more money data is the new currency for doing so. Relationships are the key, real-time is the goal and huge savings is the reward for doing so. Now let’s breakdown these three new savings enablers into actionable components:
- Relationships: All supply chain expenses have a corresponding cost driver or relationship that is the key to saving money in the 21st century. It is your job to find these intertwining relationships and then to hone in on their patterns, trends and variances to determine savings opportunities that are currently hidden from your view.
For instance, your custom pack’s costs are driven by your operating room procedures, (this is the relationship or cost driver); no procedures no attributor cost! If you track and trend your per procedure custom pack cost over time, you will discover that they change precipitously. The question you then need to be asking is why are these costs changing over time? This relationship building process is your window to identifying new and better cost savings opportunities.
- Real-time: To measure and monitor your supply chain expense relationships or cost drivers effectively, it is best to do so in real-time. Why? Thousands of dollars could be lost if you wait until someone stumbles over the fact that your I.V. set cost, or whatever, is going through the roof. Supply chain visibility in real-time is critical to reining in these anomalies before they get out of control.
- Rewards: The time you invest in identifying your supply chain expense relationships or cost drivers will be rewarded, from our experience, with an additional 7% to 15% more savings than you are realizing now. Let me make it crystal clear that these new savings aren’t price or standardization driven, but are utilization savings that are now being overlooked or ignored.
I’m sure you are thinking to yourself just about now that this process, that I just described, looks and feels like a lot of hard, demanding work. Well, it doesn’t need to be if you harness the power of technology, as we have, to search, measure and analyze, in real-time, the relationship between the products, service and technologies our client’s buy and the velocity and intensity at which these same commodities are moving through their supply streams. That’s why data is the new supply chain currency in the 21st century, because it opens up a whole new window of supply chain savings opportunities.
Filed Under: savingsblog • Supply Chain
