NTT DATA Services, Reshaping supply chains for resilience | Digital supply chain
Joey Dean, Coolest Name Man Ever and Managing Director of Healthcare Consulting Firm for NTT DATA, Focuses on Transforming the Workplace and Creating the Future Workforce for health care providers. Dean also leads innovation programs for clients to improve service delivery and business results for clients.
The pandemic has shifted priorities and created opportunities to do things differently, and companies are now looking to build more resilient supply chains, none of which are more urgent than those of the healthcare system. Dean shares with us how he thinks they can make it happen.
A multi-supplier sourcing approach
“Healthcare systems can’t afford supply chain delays when lives are on the line. Healthcare procurement teams are exploring multi-vendor procurement strategies, stockpiling more inventory and resources. use data and AI to have a predictive vision of the future and increase efficiency.
“The priority should be to consolidate supply channels and reassess standards for inventory management, ie storage for insurance. Healthcare systems should seize the opportunity to renegotiate with their current providers and expand the provider channel. Through these efforts, work with suppliers who have greater geographic diversity and greater transparency regarding manufacturing data, processes and continuity plans, ”said Dean.
But here follows the never-ending battle of national supply chains against global supply chains. In my opinion, domestic procurement limits high-risk exposure from overseas procurement – Canada’s problem with importing the vaccine is a good example. So of course I had to ask, for products that save lives, is national capacity building an option being considered?
“Domestic supply chains are scarce or rely heavily on foreign centers for parts and raw materials. Measures are being discussed from a legislative point of view to boost domestic supply, and it will take a concerted effort on the part of Western countries through a mixture of investments and financial incentives, ”says Dean.
Use great technology for better results
So, it’s far. In the meantime, leveraging technology is another way to mitigate the risks inherent in global supply chains while reducing costs and improving quality. Dean develops the potential of blockchain and AI in industry.
“Blockchain is particularly interesting for creating more transparency and visibility on all activities in the supply chain. Organizations can create a decentralized record of all transactions to track assets from production to delivery or end-user use. This increased supply chain transparency gives buyers and suppliers more visibility to resolve disputes and build relationships of trust. Another advantage is that data validation is more efficient in prioritizing time over delivery of goods and services in order to reduce costs and improve quality.
“Artificial intelligence and machine learning (AI / ML) is another area where processing huge amounts of data has incredible value in aggregating and normalizing data to produce proactive recommendations on actions to improve the speed and profitability of the supply chain. “
Evolution of procurement models
Whether it’s asking more from suppliers or increasing inventory, Dean believes sourcing models should be reshaped to foster resiliency, mitigate risk, and ensure customer needs are addressed.
“The bottom line is that health systems expect more from their suppliers. While transactional approaches focused solely on price and transactions have been the norm, collaborative relationships, where buyer and supplier establish mutual goals and results, lead to a trusting and transparent relationship. Health systems are also looking for multi-vendor strategies to mitigate risk. It is therefore imperative that suppliers differentiate themselves and adopt evolving sourcing models.
“Health systems are looking for partners who can establish national supply centers to mitigate the risk of having ‘all their eggs’ abroad. Suppliers should seek to perform a strategic assessment review that includes an analysis of the distribution network and a review of the distribution footprint to understand costs, service, flexibility and risks. This strategy should include a “voice of the customer” assessment to understand current customer issues and needs. “
“Healthcare supply chain leaders are reassessing the Just In Time (JIT) model with supplies delivered regularly. The approach does not require investment in infrastructure, but leaves organizations at risk of disruption. Having national centers and vendor warehousing gives healthcare systems the ability to have inventory on hand without having to invest in their own infrastructure. Also, in a spirit of transparency, having predictive views of inventory levels can help enable better decision making on both sides.
But, again, I had to ask, what about the risks and associated costs that come with higher inventory levels, such as expired products if there isn’t a turnaround fast enough, immobilizing cash flow, warehousing and inventory management costs?
“In today’s supply chain environment, buyers are advised to have internal just-in-time inventory, while suppliers take a just-in-case approach, preserving surge capacity, retaining stock security and build rapid replenishment channels for replenishment. But the risk of an expired product is very real. This could be held back by better data intelligence and improved technology that could predict surges and predictively automate future supply needs. This way, orders would be more data driven and streamlined to align with anticipated increases. Continued adoption of data and intelligence will be crucial for modernized purchasing into the new normal.
These are tough jobs, so I asked Dean to talk about some of the challenges. Luckily, he’s a patient guy with a lot to say.
On MIn managing stakeholders and ensuring alignment with priorities and goals, Dean said, “In order for stakeholders to stay aligned with priorities, they will need more transparency and collaborative, win-win business relationships across the board. which healthcare systems and medical device manufacturers are equally committed to everyone’s success. On the healthcare side, they need to understand where parts and products are made to perform more predictive data and analytics for forecasting and planning efforts. And manufacturers should offer more data transparency, which will translate into better planning and forecasting to navigate the ebb and flow and enable better decision making by healthcare systems.
Due to the sensitive nature of the information requested, the effort to increase visibility is generally met with great reluctance and hindsight. Dean essentially puts the onus on suppliers to adapt to the times. “Traditionally, the relationship between buyers and suppliers is transactional, based solely on the transaction between the two parties: what the supplier provides, at what price and for how long. The relationship begins and ends there. The tide is turning and buyers are expecting more from their suppliers, especially given what the pandemic has revealed around the fragility of the supply chain. Vendors who get ahead of this will not only reap the benefits of improved relationships, but they will be able to take action on the higher visibility derived information to manage risk more effectively.
He offers one last piece of advice. “A first step in enabling an exchange of supply chain data is to ensure that partners and buyers are informed of conditions throughout the supply chain on the basis of real-time data to enable predictive views of delays and disruptions. With well-understood data sets, both parties can respond more effectively and work together in the event of disruptions. “
As for the direction of the supply chain, Dean said, “Going forward, we will continue to see an evolution towards robotic process automation (RPA), artificial intelligence (AI) and analytics. advanced to optimize the supply chain. The pandemic, as it has done in many other industries, will accelerate the digital switchover, with the benefits of improving efficiency, visibility and error rate. AI can consume huge amounts of data to drive real-time pattern detection and mitigate risks from global disruptive events. “