As healthcare leaders know all too well, the procurement process can be plagued with inefficiencies and complications. The pandemic may be behind us, but the memory of PPE shortages remains vivid, and supply chain disruptions remain an issue. Trade barriers, extreme weather, and limited supplier options all make sourcing more costly and difficult.
According to a recent survey, 71% of healthcare systems are still experiencing distribution delays in their supply chain, and 55% report issues in raw material and sourcing availability. These challenges have very real financial implications. In the same survey, nearly one-third (29%) of respondents have seen non-labor costs increase by 11% or more.
Yet ensuring access to adequate, safe supplies is critical to any healthcare facility, from hospitals to small clinics to veterinary offices. Healthcare providers must have the devices, machinery, and medications that save lives and support patient well-being.
So, how can leaders at healthcare organizations navigate today’s supply chain and manage skyrocketing costs at the same time? One way is to embrace digitization and the advanced tools that can find efficiencies while handling sourcing without sacrificing quality. There are certain key strategies that healthcare leaders can implement to improve procure-to-pay processes for their organizations:
Digitize and integrate systems
Healthcare systems’ supply chains need to become more nimble, starting with greater visibility into current and projected stocking levels. This can be challenging for large-scale, geographically dispersed healthcare organizations, but any hospital or facility can experience these issues.
“Healthcare organizations often find it difficult to fully integrate their supply chain processes, and there are a few reasons for this,” says Karrey Pecore, senior solutions developer with Amazon Business. “Competing organizational priorities, budgetary constraints, and unexpected events like natural disasters can force staff into more reaction-based supply chains and create shortages, which impact patient care,” she explains.
Manual ordering and inventory management processes cannot overcome these challenges, but digitized, integrated procurement systems can. For example, Amazon Business can integrate with over 300 e-procurement systems, allowing organizations to connect their existing systems to Amazon Business for simplified buying.
“It’s very easy to get more from your existing e-procurement system by connecting it to Amazon Business. Buyers can access the selection and convenience available on Amazon Business while maintaining the compliance, management and control provided by their current system,” Pecore says.
With Amazon Business, healthcare systems can bring multiple users onto one account and assign different roles and permissions. Administrators can identify preferred vendors and block others. They can also set spending limits to prevent rogue purchases or ordering redundancies. These solutions provide critical visibility — rather than visually checking every supply room or closet — and enhance compliance by adhering to approved supply sources.
Once healthcare leaders know what they have and need, they can work towards supply chain resiliency.
Leverage data analytics to find efficiencies
Digitization does more than identify immediate procurement needs; it assists with demand forecasting and responding to changing conditions. AI-powered tools can analyze large datasets to uncover inefficiencies that may not be otherwise obvious, such as inventory shortages, inconsistent vendor performance, or price inaccuracies. These insights let healthcare procurement teams make proactive decisions before stockouts happen.
They can also reveal how inventory fluctuates at certain times of the year or with particular disruptions so that healthcare facilities can be better prepared. AI tools, therefore, can become a force multiplier for procurement teams.
“Amazon Business Analytics Savings Insights uses AI to help you analyze spending patterns quickly,” Pecore says. “It helps you identify ways to save money and make smart buying decisions without requiring special skills or experience with analytics tools.”
Consolidate or expand suppliers on the fly
With insights from digital and AI-powered solutions, procurement teams can make informed decisions about their supplier options. If facilities need to consolidate bulk shipments spread across multiple suppliers, solutions like kitted and palletized orders from Amazon Business help streamline the delivery process.
Regional veterinary care provider Modern Animal, for example, developed custom kits with Amazon Business to expedite new clinic openings across the western U.S. The consolidated deliveries reduced their receiving timeline from 14 days to just three.
Conversely, if healthcare systems need to diversify their supplier base, integrated systems like Amazon Business can help. On Amazon Business stores, Procurement teams can filter by certifications, such as local suppliers, to identify suppliers nearby. With Request for Quote, organizations can receive customized pricing on bulk orders or specific product configurations that meets their business needs. In today’s shifting macroeconomic environment, these capabilities help ensure that mission-critical supplies are not only available to healthcare systems but are also compliant with organizational policies and cost-efficient.
Healthcare procurement for the 21st century
Procure-to-pay systems have made great strides, and embracing digital solutions and advanced technologies is vital for all types of healthcare facilities to meet their patients’ needs. Shifting to new systems can seem daunting, but the potential savings in cost and employee hours make it more than worthwhile to digitize and integrate procurement tools. Doing so will optimize operations and ensure that patients always have the life-saving supplies they rely on healthcare systems to provide.
“Healthcare procurement is at a pivotal moment. The challenges of rising costs, supply chain disruptions, and regulatory pressures are pushing us to innovate,” Pecore says. “However, success requires more than just the integration of digital solutions — it demands a cultural shift within organizations. By recognizing their synergies, healthcare procurement teams and B2B solution providers can establish a model that fosters a continuity of care.”
Find out more about how Amazon Business can streamline procurement for your healthcare organization.
