Hospital Strategic Plan Template

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					Hospital Strategic Plan Template

Key to success is incorporating Supply Chain into the organization’s strategic plan

“To support Best Memorial Hospital’s Strategic Plan, mission, vision and core
values, Supply Chain Management (SCM) will develop and facilitate the delivery of
specific programs and services to optimize non-salary reduction by promoting direct
expense reduction, cost effectiveness, and the responsible use of resources though
the deployment of proven SCM strategies. Measures of success include:
           • Declining Supply Cost/CMI Adjusted Discharge from $X to $Y
           • Declining Supply Cost as a percentage of Total Expense for X% to
              Y%
           • Declining Supply Expense as a percentage of Net Patient Service
              Revenue from X% to Y%”




Key Elements of SC Strategic Plan

   •   Guiding Principles
   •   Vision
   •   Mission Statement
   •   Measurement against goals
   •   Resources
   •   Barriers to success




Guiding Principles Examples
   • “Let’s make non-stock an oxymoron”
   • Point of service quality will be equal to or better than….
   • 70% of the final delivered cost of goods and services delivered is dependent
      on information
   • The most important part of the supply chain is the last 5 feet
   • If you don’t make dust, you can eat dust
   • He who dies with the most information wins! (adapted from Ted Turner)
   • Telling a physician to standardize is like telling them how to practice
      medicine
Supply Chain Strategic Plan

  •   VISION:
         • The Supply Chain is efficient in every area so the health system can
           provide excellent and cost effective health care

  •   MISSION:
        • To involved the entire health care enterprise to reduce waste and
           inefficiently while strengthening processes and enhancing value

  •   KEY ELEMENTS:
        • Supply Use Evaluation
        • Standardization
        • Utilization
        • Collaboration
        • Knowledge

  •   MEASUREMENT:
        • Supply costs as a percent of total expense and net revenue
        • Supply expense per unit of service, adjusted patient day and
          treatment procedure
        • Handling costs as a percent of throughput
        • Cost increase compared to relevant cost of living indicators

  •   BARRIERS TO SUCCESS:
        • Lack of accurate and timely information to measure performance and
          progress
        • Failure to engage and hold accountable supply intensive department
          clinical managers
        • Comfort with the status quo
        • Lack of mission critical skill sets
Supply Chain Strategic Plan
Executive Summary


                                 Stage 1                  Stage 2                      Stage 3                         Stage 3                        Stage 5
Contracting                                                                GPO Augmented Central
                         Little Standardization   Minimal price parity
                                                                           Contracting                       IDN Contracts with GPO        GPO $ Custom Contracting
                       Multiple GPOs              Single GPO
Transaction Management Paper Based at                                                                                                    Continuous Replenishment
                                                  Centralized Paper Based Partial EDI                        Full EDI Sets/Web Based
                       Department Level                                                                                                  with VMI
External Distribution                                                                                                                    Third Party Logistics
                       Bulk via Distributors      Facility Based LUM       Vendor Supported LUM              Consolidated Service Center
                                                                                                                                         Joint Venture with distributor
Receiving & Stores
                         Traditional              STAT Stores              Reduced STAT                      Cross-Docking                 Pre-Received

Product Utilization                               Product Standards                                          Physician Supported
                         No Formal Program                                 Strategic Cost Management                                       Credentializing
                                                  Group                                                      Formulary
Work Measurement                                  Limited Activity Based
                         No Standards                                      Full Activity Based Costing       Activity Based Measurement Continuous Feedback
                                                  Costing
Process Improvement                                                       Proactive Definition & Control of
                                                                                                            Lean Thinking                Design Excellence
                         Highly Variable          Limited Standardization Problems
                         Processes                to Best Practices       Selective Six Sigma Methodologies Waste Reduction              Performance By Design
                                                                                                            Transformation of processes
Organization                                                                                                                             Integrated Decentralized
                         Decentralized            Partial Centralization  Corporate Program                 Integrated Logistics
                                                                                                                                         Management
Accountability           Budget Based             Job Description                                           Targeted Goals with Clinical
                                                                          Supply Performance Measurement                                 Forward Forecasting
                         Decentralized            Emphasis                                                  Managers


                                                               Where we are now

                                                               Where we want to be