Possession of digital technology in the supply chain isn’t enough – we need to leverage it
Advice from Dr. Randy V. Bradley at this year’s HSCN Conference
If you were hoping that your clients were going to cut you some slack because you’re a healthcare organization, think again. “You are consistently being compared to your customer’s last best experience,” says Dr. Randy V. Bradley, strategist and researcher at the Haslam College of Business at the University of Tennessee. “They are no longer willing to give you break because you’re a healthcare organization.”
Welcome to the age of what Bradley calls a-commerce, where people want things anytime, anywhere, and anyway they desire it. In his message to supply chain and procurement professionals at this year’s Healthcare Supply Chain Network (HSCN) Conference, Dr. Bradley mixed empathy with reprimand – you haven’t always had sufficient support to invest in digital technologies, but you’ve also been slow to respond to the triggers.
Whatever your reason, he was pretty clear – the supply chain in healthcare organizations has no time to waste in acclimatizing and investing in digital technologies.
But as Cynthia Valaitis, CEO of HealthPRO, which sponsored Dr. Bradley’s talk, said in her introduction, “How is the ordinary person supposed to make sense of it all?”
It starts with asking some fundamental questions, “Why do we do what we do, and what if we did it differently?” Here are a few of the issues Bradley says we need to think about.
Moving up the rank of priorities
We might be inclined to think about digitization as being one process, but Bradley says we often implement it in one of two ways: the traditional way, when you take something with analog properties and make digital copies of it; or the contemporary way, when you leverage emerging technology to create revenue and/or enable stakeholders to realize greater value from your products and services. Those who understand the distinction are well acquainted with the five pillars of the digital supply chain: social, mobile, analytics, cloud, and the internet of things.
If the supply chain has been slow to adopt digital technologies, it’s not necessarily our fault. Even those organizations that are trying to incorporate AI systems into their businesses have been hampered by longstanding biases and misconceptions. On the list of hospital priorities, for many years, the supply chain didn’t even rank. “We didn’t make the list in 2017, and in 2018, we were 21 out of 24,” says Bradley.
That looks like progress, but the reality is not as hopeful. “The supply chain as a strategic asset does not resonate with the C-suite,” he said, “not only within healthcare but also other industries as well.”
AI has the money and the talent
Digitization of the healthcare supply chain isn’t moving as quickly as it should, but that doesn’t mean we should lose sight of what’s going well. “We are one industry that is struggling to do more with more,” he said. After years of declining investment, there is more money than ever being invested in digital technologies; in the last year, budgets for emerging technologies have grown by 95%. As the general financial landscape has improved, so has the talent pool – there are more supply chain professionals with the right technical skills. Unfortunately, Bradley says, they’re not adept at responding to consumer demands or explaining the real value of emerging technologies.
“Studies have shown that we have no trouble taking advice from a device rather than a person,” Bradley said. This is having huge implications in the healthcare environment, where patients are coming to us expecting an Amazon experience and what we’re giving them is an AOL experience.
“When you think about your supply chain, is it a partnership?” he asked. We think we need to win all the time, but real partnerships are a balance of wins and losses. “We should be thinking of the duration of the relationship, not the transaction,” he said. “You don’t win with one transaction.”
Which brings us back to the central question Bradley posed at the beginning – why do we do what we do and what if we could do it differently? As he dazzled the audience with videos of robots quietly and effortlessly doing deliveries on hospital floors (maneuvering around obstacles and getting on elevators) and moving supplies from the loading dock to the warehouse, he explained, “This is a journey not a destination.”
Taking away the work that is dirty, demeaning and dangerous
Our sense that digitization is going to affect every part of our business is true (it already does), but Bradley says we need to separate the hype from the reality. For starters, the patient has to be at the centre of everything we do. “They are the receptor,” he said. “We need to ask them what outcome they expect.” He calls this ‘true time decision-making’ – don’t give me all the information; just give me the right information, at the right time, and in the right context.
Bradley does not believe the goal of AI is to replace the people who do the work. Yes, robots will get the job done, but they will also take away the work that is dirty, demeaning, and dangerous. “The goal of AI is make your people brighter and more capable, not to replace them,” he said.
The next generation supply chain, says Bradley, needs to go from predictive to prescriptive. That involves casting a pretty wide net, developing systems that are digital, connected, collaborative, transparent, always on, secure and trusted, effective and efficient, and safe and sustainable.
Get your fundamentals organized
That’s a tall order and many were probably wondering, are we ready? On the surface maybe not. Bradley’s question, “Does your organization have a defined digital strategy?” drew what he said was a predictable response – 73% said no and 27% said yes. “Even if the strategy is not formally in place, that shouldn’t stop you from tackling the low hanging fruit,” he said. Have the conversations and get the fundamental things organized first, like which investments in automation make sense in terms of where your organization is going in the next three to five years.
Emerging technologies, innovations, and advancements will continue to shape the digital supply chain in the future, but Bradley closed with his advice not to be overwhelmed by the hype. Invest in the right stuff and consider what type of retrofit you have to do to accommodate those things. “Possession alone isn’t enough,” he said. “You need to keep asking, how am I going to leverage it?”