Here at Healthcare Matters, we work to elevate the profile of the SCM profession. Simply put, we have a hard time understanding why it’s taken so long for traditional business executives to recognize that SCM leaders deserve a spot in the C-suite, regardless of the industry sector, and especially in health care.
Lynn Britton started out in procurement. He didn’t just make it to the C-suite; he is Mercy’s high profile CEO. That’s an important bit of information. It helps to explain how ROi, an idea of Britton’s and his colleagues, now Mercy’s supply chain arm, and one our industry’s best run, most decorated and innovative supply chain companies (ranked #3 by Gartner), sprang from a group of Catholic hospitals run by an order of nuns (Sisters of Mercy) in the Midwest.
Today’s post is about a significant and highly strategic deal that was inked just yesterday between SciQuest and ROi (press release). SciQuest announced that it was selected by ROi to provide Mercy an eMarketplace. But it’s a little bigger and more strategic than that. As a SciQuest executive put it, “we’ve been selected to ensure compliance across an entire GPO contract portfolio.”
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SciQuest is a leading eProcurement solution provider whose centerpiece technology, called the “Virtual Item Master (VIM),” powers a best-in-class catalogue management/eMarketplace solution. The VIM can be considered a unifying data integration platform. It has excellent visualization, content and contract management capabilities and a killer search algorithm that should be demoed live to be fully appreciated. The VIM is highly configurable, so it can be implemented quickly and in clever ways that leverage other systems and tools to support purpose built solutions.
ROi (Resource Optimization & Innovation) is a GPO, but describing ROi as “Mercy’s GPO” is like saying Bill Gates is “financially secure.” ROi does so much more than manage Mercy’s supply chain; it’s an integral part of Mercy’s supply chain. Run through your mental checklist of traditional GPO services and then start using your imagination to add several more (including custom manufacturing and packaging) and you’ll start to get the idea. The company is an award-winning innovator that has been acknowledged for several SCM programs it has developed, including one that directly links SCM practice to patient safety.
Sisters of Mercy Health System (Mercy) is one of the nations largest IDNs. Mercy employs 1,500 physicians supported by 38,000 co-workers across 30 hospitals and more than 200 outpatient facilities throughout the Midwest. The system continues to expand (now into the Midsouth) and enjoys a stellar reputation.
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By definition, it’s the diversity of care and the accessibility to it that makes an IDN stronger than the sum of its parts. In a procurement context, embracing such diversity without losing pricing leverage is essential, otherwise, utilization and compliance goes out the window.
The ROi/SciQuest combination will allow each ROi customer (or defined group) to shop in its own, private marketplace and/or any permitted shared marketplaces with assurance that all supplier requirements and all product and catalog details are always updated and synchronized to back office systems regardless of how many different market views are configured. Contract terms are managed in the same system, regardless of how nested, conditional or “expressive” those terms may be. This is a particular strength of SciQuest’s technology –a competitive differentiator that has been successfully implemented in other markets (public sector, life sciences, universities) where SciQuest has been a leader for the better part of a decade.
IDNs are notoriously skeptical of GPO-reported savings for reasons that are generally rooted in contract compliance. Pleasing the accountants is essential. Beyond managing contract compliance at the point of sale, SciQuest can consolidate transaction level reporting for each customer or subgroup, by supplier, contract, commodity, unit, or at the SKU level –anyway the accountants want to see it.
When you’ve got a pair of like minded CEOs like Stephen Wiehe (SciQuest’s CEO) and Lynn Britton, each personally invested and sharing a vision for SCM that inches it closer and closer to the point of care, well, let’s just say that we’re going to pay close attention to what’s going on at Mercy. We’re thinking this project is laying the foundation for several “firsts.”
–Tom Finn
