Hospital lessons in data synchronization
By Erin Burke
Materials managers concur that success depends on participationIn last month’s issue, vendors who participated in the Department of Defense’s data synchronization pilot program detailed their experiences, including what they learned from the project. But several hospitals assumed leading roles beside vendors in the data synchronization pilot.
This month it is their turn to detail their experiences and share opinions on what is needed to make data standards a reality. It’s clear, though, a consensus exists among both vendors and hospitals that everyone involved with the health care supply chain must collaborate and participate to ensure this movement both evolves and reaches fruition.
Q Please describe your institution’s involvement in this program, providing details about how the program differed from your existing processes.
MIKE BROWN, Director of Materials Management, University Health Care System, Augusta, Ga.: The major focus of the pilot from University Health Care System’s perspective was to test the impact of standardized data used throughout the supply chain on our ability to manage information in our materials management information system. Inconsistent information throughout the supply chain from manufacturers, distributors, GPOs and hospitals makes managing data difficult because it requires a significant amount of manual work.
University’s pilot program demonstrated that if all participants in the supply chain use the same information, the process of managing the information can be automated.
FRANK FERNANDEZ, Assistant Vice President, Corporate Director of Materials Management, Baptist Health South Florida, Miami: Baptist Health South Florida participated in the pilot program with our enterprise resource planning (ERP) partner, Lawson Healthcare, our vendor partner, BD Healthcare, and our GPO partner, Premier. The goal was to demonstrate that a manufacturer could assign standardized descriptive attributes to a list of their products that we use in our facilities. That list would then be shared with our GPO, and imported directly into our ERP system. Orders placed by Baptist Health would then reflect these normalized descriptions for the products in the pilot. As a result of our pilot’s success, we were able to demonstrate that automated data synchronization using standardized product descriptions and attributes is possible across all stakeholders in the health care supply chain.
KAREN WOLFE, Finance Coordinator, Supply Chain Management, Mayo Clinic, Rochester, Minn.: Mayo Clinic’s tasks were to retrieve supplier-provided data from the data pool, map and load that data into our ERP and materials management information system (MMIS) and determine time savings. We first identified the data elements we wanted to retrieve, which were supplier name; product number; global trade identification number (GTIN); description; unit of measure string, including the buy unit of measure and package dimensions; and product trade name.
Once the data was retrieved in an XML format, we converted it to Excel and, using a reporting tool, identified both missing products and those in the system. For the products that matched, we loaded data elements such as GTIN and packaging size to our existing item profile. For all the others, we loaded necessary elements as new item profiles.
With these data elements, we can identify products in the same way a supplier or distributor identifies them. This differs greatly from our current process of manually verifying data, which is time-consuming and can lead to inaccuracies. With the implementation of GTIN, we were able to readily reconcile supplier products to our system products. With this process, there was an estimated 50 percent time savings in both contract price loads and new item profile data loads.
Q What motivated you to participate in this project and what key lessons did you learn from the experience?
BROWN: University Hospital wanted to evaluate whether the use of standardized data could significantly improve our ability to manage the information in our MMIS. Specifically, we wanted to make sure the catalog numbers were correct, that the correct price was loaded in our system and that price was in accordance with either our GPO or local contracts. The primary lesson we learned was that the use of standardized data greatly enhanced our ability to manage our data. The retail world long ago recognized the importance of using standardized data and we learned that health care could garner the same benefits.
FERNANDEZ: We have taken a leadership position in promoting the rapid adoption of health care supply chain e-standards. Our organizations have grown to be more complex over the years.
We need to take advantage of automation, to support patient care from a supply chain perspective. Our ability to use automation to its fullest potential is severely hindered when there are no consistent, widely accepted standards for describing products across the health care supply chain.
The value of data synchronization has been demonstrated over the years. The Effective Consumer Healthcare Response (ECHR) project documented and quantified the value of automation and the use of standards in the health care supply chain. However, wide adoption of standards has not taken place. There have been competing standards. There has been general mistrust on the part of all stakeholders in the health care supply chain regarding perceived pitfalls of standardized product descriptions, classification schemes and standardized product attributes.
The ECHR report was published in November 1996. Here we are, 12 years later and we still don’t have wide adoption of standards in the health care supply chain. It took a willing manufacturer in BD to recognize that it is time to move forward and agree to submit their product line to a set of conventions for standardized descriptions of their products.
A key lesson we learned included the importance for manufacturers to embrace this process and to understand that doing so can only help strengthen their relationship with their health care customers. Another key lesson was that the present technology will support data synchronization with minimal modifications, if any.
WOLFE: Knowing that all participants would be speaking the same language is the motivation for streamlining the supply chain process from start to finish.
Health care providers should see improvement throughout the supply chain, including products being delivered to the correct address. Providers will be updating their own information into the GS1 global location number (GLN) registry, eliminating our reliance on GPOs to keep our information clean.
Improved price parity opportunities is another benefit, i.e., product identification will be by GTIN and not a vendor product number—giving accurate data match at all times.
Providers will be able to pull more accurate product use information, which will provide leverage in contract negotiations. No longer will there be any question as to what product is being ordered/issued for a given department and all product data will be mapped to the proper GTIN, eliminating duplication of product.
Also, the recall process will become smoother because of product mapping to the GTIN, which will allow an organization to identify the recalled product readily. With the use of the GLN, rebates will be credited to the correct department.
Q How did your MMIS or ERP systems perform in terms of accommodating the data fields required for the global data synchronization network (GDSN)? Did data entry take more time? How did you view the data management process?
BROWN: University Hospital’s MMIS performed well in terms of receiving the information necessary to conduct transactions. Specifically, the system received product numbers, descriptions and a unit of purchase without any problem. We also incorporated pricing information even though the information did not come from the GDSN.
We automated the process of adding new information to the MMIS, although accomplishing this task required the use of a program that handled the interface between the GDSN and our MMIS. The process improved our ability to receive standardized information from participating suppliers.
The process being tested certainly made it easier for buyers to review product information from suppliers, then add that information to our system.
FERNANDEZ: Our Lawson ERP accommodated all of the data elements contained in the BD product descriptions. We did not perform any manual data entry during this process. All of the data were imported into our ERP in an automated fashion.
WOLFE: Data entry time is about the same. Our system was able to accommodate all the data as well. However, we will be seeking technical updates so that the GDSN data will be represented properly throughout the supply chain process. An example of this would be to have the GLN process either on the header of a purchase order or at the line level. Currently GLN is at the line level only.
Q Were you able to readily obtain the GLN and GTIN from participating supply sources? Were there any formatting or other problems?
BROWN: We were able to readily obtain both the GTIN and GLN from participating suppliers and GPOs. The hospital did not have any format problems with the GTIN information, however, our MMIS cannot use the GLN as our vendor number. For the foreseeable future, we will to continue to use our system generated vendor number in lieu of the GDSN GLN.
FERNANDEZ: For this stage of the pilot, we did not focus on the GLN. We were successful in importing product ID numbers directly into our ERP.
WOLFE: Information was readily obtained for both GLN and GTIN. The challenge is obtaining the information in a usable format that could then be transferred to our ERP using the sources we have in place today.
Throughout the pilot, we needed to have the information in an Excel format, not XML. It proved to be a challenge to transfer product information into a usable mapping and loading tool.
Q What are the key challenges that must be overcome for global data standards to be successfully implemented in the health care supply chain?
BROWN: Key challenges confronting the adoption and implementation of global data standards are:
1. Providers need to recognize that standardized data synchronized between trading partners can have a significant, positive impact on our ability to more effectively manage the health care supply chain. Standardized data will happen only if enough health care providers put enough pressure on manufacturers, distributors and GPOs.
2. If adopted, these changes will require a number of years to implement and only can be implemented through small, incremental steps. The pilot program has made a concerted effort to ensure that the fields being tested are those necessary to conduct transactions between trading partners. It is tempting, although a potential downfall, to add more information than what is needed. If that happens, the program could become too complex for the supply chain to successfully adopt.
3. Vendors that service GDSN participants in the retail industry need to understand that this process is new to health care and that some business models may have to be modified to accommodate the unique characteristics of the health care supply chain. It has challenges that do not exist in retail and they must be recognized and accounted for.
FERNANDEZ: Without manufacturers fully embracing standards, data synchronization will not be possible. Over the years, there has been plenty of speculation as to the reasons why this has not been fully embraced. All stakeholders in the health care supply chain should embrace this. For us, this experience enhanced our relationship with our manufacturer. Full participation by manufacturers will only help solidify relationships they already have with hospitals and add value to their product offerings.
WOLFE: Supply chain participants will need to use common standards throughout the supply chain. An example is if GLN is primarily used by providers, all supply chain participants would need to also accommodate the use of GLN within their systems.
Q What steps can hospitals take to prepare for the implementation of data standards and what benefits can they expect to reap?
BROWN: A primary focus for hospitals should be to ensure that they have accurate data (specifically pricing) and that it is in accordance with either GPO or local contracts.
There is a tendency in health care to rely on data cleansing and analytic services to help identify what products we are buying, product prices and whether those prices are in accordance with contracts. These services can add value, but a drawback is that they are focused on what has already transpired.
Additionally, this effort should help hospitals recognize the benefits that the use of standardized data throughout the supply chain can bring to this process.
Specifically, the use of standardized data will enable the synchronization of systems, which will help automate processes and reduce the amount of manual work required to manage our information systems.
FERNANDEZ: Participation in pilots will help hospitals to understand the benefits of data synchronization. Hospitals should then communicate both the value and benefits to their distributors and manufacturers.
Benefits include better product identification, improved safety, consistency of descriptions and product attributes, more efficient management of ERP item files and more accurate shipping and receipt of products at their intended destinations.
WOLFE: Knowing how the GDSN data elements fit within the data stream and what one wants to obtain from implementation are key factors.
Data elements are just that unless there is a specific need or process improvement. One example would be to reduce duplicate data within the ERP system. With the addition of a GTIN tied to the data, the reduction of data duplication should be immediate.
This article 1st appeared in the April 2008 issue of Materials Management Magazine.
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