When Advantus President Dan Hurry was diagnosed with cancer, he had an epiphany. At the time of his diagnosis, he had been working in supply chain management for over 30 years. He was an expert. However, his observations in the hospital where he was being treated – what he describes as a total disconnect between clinicians and the different parts of the diagnosis and treatment process – got him thinking.
“When I was diagnosed with cancer, one of the things that was interesting to me was the disconnect that I experienced between the physicians, the diagnosis, and ultimately the treatment that would take place,” said Dan in a recent keynote speech.
After his experience in the hospital, Dan was convinced that there must be a better way of managing supply chain in the health care sector. At the same time, he was starting to have an “empty feeling” about his existing role, and whether he was doing enough to help people. So, he started to learn more about health care. “I got more of an education of what was happening through my personal experience and then through talking with different folks.”
Not long after that, Dan met the Chief Medical Officer of Baptist Health System in San Antonio, Texas, who asked if he was prepared to bring his supply chain and logistic knowledge into health care. Dan immediately said yes.
“I didn’t really know what went on there, but I now had a passion, a different goal, a different pathway. I believe it was handed to me, so I was in, but I didn’t know what we were going to do. After a discussion with the leadership team at Baptist Health System, I jumped in and became the Vice President of Supply Chain.”
Dan quickly learned that the health care supply chain disconnect he observed while in hospital ran far deeper than he had imagined. It ran as deep as UPCs (universal product codes) – those numbers and bar codes you see on just about every consumer product, from candy bars to TVs. Those simple numbers and lines are the bridge between the physical and the digital worlds. They help the entire product supply chain work.
“You’ve probably never had to think about it,” adds Dan. “As you go out and buy goods every day, that code is what connects intelligence to the supplier base. It connects intelligence to the consumer, to the retailer, and allows e-commerce to take place all day, every day.”
When it comes to the medical device industry and medical commodities, there simply isn’t the same universal language in the digital supply chain. It’s not as complex or rigid, and certainly not as consistent as it is in the retail world. And the irony is that medical devices and commodities are far more important than candy bars or TVs to people’s health, to healing them, to bringing them to a better place.
Dan gives the example of the humble pacemaker. Does it have a UPC? No. And this is the crux of the problem, as he sees it.
As already mentioned, UPCs are the bridge between the physical and digital worlds. They are a part of the universal language that determines demand planning, what goods are needed and when, when they’re going to move, and how they will flow through the system.
Outside of health care, the physical side is tied to the digital side – it uses the digital language to pull products through. It’s predominantly the digital side pulling the physical side. As Dan says, it is the ‘digital intelligence’ that drives what you should do physically.
In much of the health care sector, unfortunately, it’s the other way round. Products are purchased, paid for, and used, and there might be some digital recording after the fact, or at best in real-time. Dan realized this needed to be reversed, to go from physical/digital, to digital pulling physical. “We need to get to a place where we’re truly doing demand planning, production planning, and understanding where we’re going. This will allow us to truly impact the cost of care, the cost of supply chain.”
As the recent Gartner Healthcare Supply Chain Top 25 report states, a resilient health care supply chain combats rising costs and disruption. Disruption is here to stay; cost increases are inevitable. The challenges are immense and cannot be ignored any longer.
It won’t be easy, but there are pathways to get there. As Dan explains, “the only challenge with it is historical thinking. Quite frankly, it’s just that we’ve had a mindset that’s trained to do things in a certain manner that made sense 20, 30 years ago, but we haven’t evolved to our full capability. The time is now, right?”
Advantus was established to specifically challenge the dated industry norm that ‘your GPO is your supply chain solution.’ It is tackling the obstacles that prevent health care from evolving and it is providing answers to problems that move past terms and conditions and into the walls of our hospitals. And Dan is leading the charge.
The time is now. Right?