Hospital Materials Management Benchmarking Program Launched

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Health care supply chain strategist Lynn James Everard announces the launch of a new hospital materials management benchmarking program. This innovative approach breaks away from traditional supply cost benchmarking and focuses instead on measuring the cost of the hospital’s logistics and materials management function. In so doing, it provides a new avenue for Materials Directors to demonstrate their proficiency.

Health care supply chain strategist Lynn James Everard announces the launch of a new hospital materials management benchmarking program. This innovative approach breaks away from traditional supply cost benchmarking and focuses instead on measuring the cost of the hospital’s logistics and materials management function. In so doing, it provides a new avenue for Materials Directors to demonstrate their proficiency. Hospitals have long struggled to understand the real meaning of supply cost benchmarking reports. A poor showing has historically led hospital CEOs to insist that their Materials Directors both explain and improve their results. But the inherent challenges in collecting supply cost data would bring into question both its accuracy and usefulness, leaving many Directors and their superiors frustrated about their performance but unable to improve it because the reports do not disclose causes or cures.

Often lost in the hospital’s ongoing uphill battle to control ever-increasing supply costs is the fact that supply management itself can create significant organizational costs. In fact, a single hospital can spend millions of dollars per year in the management of its materials function. This is above and beyond the cost of the supplies themselves. According to Lynn James Everard, C.P.M., developer of the new program and author of “Understanding and Measuring Hospital Materials Management Performance”, “Current supply cost benchmarking fails to measure materials management performance. But even if they did accurately reflect supply costs, the current benchmarks still would not account for the hospital’s significant functional materials management costs. Yet these costs may represent one of the hospital’s most significant opportunities for efficiency gains, operational cost savings and increased caregiver productivity. This new approach empowers hospitals to finally measure and manage these critical costs.”

This new program offers hospitals the opportunity to benchmark their total supply management cost per average occupied bed against other similar sized hospitals. Benchmarking reports will include information on operational efficiency improvement and tips on implementing Activity Based Management in the materials management function. The initial data collection period will end on March 1, 2006 and initial reports will be issued around April 15, 2006. A second data collection period will end in September.

Customers who sign up by paying the annual subscription fee of $1,500.00 will receive the report, “Understanding and Measuring Hospital Materials Performance”, a $250.00 value, at no charge. Customers who prefer to purchase the report first will pay just $250.00 and receive a credit for that amount against the cost of their first year’s participation in the program, provided they subscribe to the benchmarking program by January 15, 2006.

To learn more call 954-647-3554.

Lynn James Everard, C.P.M. is a health care supply chain strategist and consultant and twenty-four year industry veteran. An experienced distribution and logistics manager, Everard has long advocated for hospitals to address the costly inefficiencies in their internal supply chain operations. He is the author of over seventy-five published articles and six major reports, including "Blueprint for an Efficient Health Care Supply Chain".

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Lynn Everard

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