Why Hospitals Should Appreciate Their Supply Chain Teams


In the past, I’ve occasionally been a little harsh on supply chain leaders because they have historically not focused on finding savings within their purchased services categories.  However, today is a new day and purchased services is finally getting the attention it deserves within the healthcare industry.  

I’m a firm believer that supply chain teams are the backbone of a hospital (not those overpaid docs…I’m kidding, but you know what I mean), and it’s time for them to get their due credit. Not only are they integral in reducing costs at your hospital, they help improve outcomes and constantly put out fires. There are many reasons to be appreciative of these teams, but here are our top five.


1. They’re in the know.

Supply chain teams know the ins-and-outs of industry standards, regulations, and new trends.  They do this by continually reading industry publications and articles, attending trade shows, and learning from the vendor community. They then share their knowledge across your organization through all of the value analysis teams they are involved in as well as other channels.

Your team should have access to the necessary resources to set long-term goals in order to provide timely guidance. This is especially helpful in today’s uncertain healthcare landscape.


2. They allow providers to focus on patient care.

Effective teams help their respective health systems become more and more efficient by streamlining the purchasing process, optimizing operational procedures, saving time, and reducing supply and labor expenses.  

This allows healthcare providers to focus on high quality patient care and not worry about if the right products are on the shelves or if the electricity bill will be paid.


3. They benchmark their performance.

The most successful teams make a habit of benchmarking their performance against other leading organizations. To evaluate performance, teams should have access to comparative databases that include:

  • Resource utilization
  • Cost per procedure (or DRG)
  • Mortality rates
  • Length of stay
  • Readmissions
  • Service Unit Measures (for Purchased Services categories) 

By measuring their performance against their peers, they can see how they compare with regional and national benchmarks and adjust their strategies accordingly.


4. They enable new technology to get to market faster.

Supply chain teams are the first to review new products, services and software submitted to the market by vendors. They determine their clinical effectiveness, operational efficiency, and if the product is a significant advance in terms of patient or provider safety. If approved, this new technology gets to the market and into the hands of users faster.


5. They make data actionable.

By accessing the latest technologies, supply chain teams are able to determine appropriate standardization and utilization of drugs, devices, products, and services. This data allows them to not only improve quality outcomes, but drive down expenses.



Supply chain teams have a larger influence on their respective hospitals than most realize or give them credit for. There are many more reasons to celebrate your supply chain team, but these are our top five. 

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