Guest article by Phil Sayles, founder of Summate Technologies
Sitting on my couch, I clicked the “submit” button on the Home Depot website, an online order of a 6×9 umbrella for my deck. It was delivered to my house 2 days later. I had bought the same umbrella 13 years ago. Back then I had to visit 3 stores, it was twice the price, I had to special order the color I wanted, and it took 3 weeks for it to be delivered for pick up at the store.
What happened? Why was my experience so much better now than back then? I’ll tell you why, and it is two simple words: digital transformation. When I purchase something online now, the seller learns about me – where I live, what my preferences are. Instead of visiting 3 stores over an afternoon, I visit 5 websites in 10 minutes. All of the data surrounding my purchase is used be benefit me. As a consumer I get better selection, better price, and much more convenience because of better information reduces friction in commerce. Superior information and unfettered flow of data leads to consumer benefit – this is inarguable.
If you would like an example of the complete opposite end of the spectrum, go visit a hospital operating room during orthopedic surgery. The consumer, ostensibly the surgeon, is using items and implants in the course of surgery. They are not tracked digitally in the field, but manually – written down. They are then “called out” to a nurse in the corner of the room, who attempts to find them on her computer. Sometimes she can find them, sometimes she cannot. She makes her “best guess” – however about half of all patient records for orthopedic implants are incorrect so its basically a crap shoot. The incorrect usage record is then manually entered into a computer in purchasing a few hours later, and incorrect items are sent to the hospital for replenishment. The bill arrives and a sales rep chases down a PO sometime over the next 2-3 weeks, but most of the time is spent haggling over the incorrect implants ordered. Something that takes seconds in the retail industry takes weeks for healthcare, and is marred by horrible waste and inefficiency.
On the other hand, you can have a sales rep waste up to three days of travel (checking equipment in 24 hours before the case, covering the case and writing the implants used down on another day, and then finally showing up to check the set and send it back on the third day). This incredibly costly system is why a $5 screw can cost healthcare $150, or more. And at the end of the day, guess who pays for that mark up? You do, pal. Its just one reason why your insurance premiums cost so much.
What a mess. It’s criminally inefficient.
The main difference between the umbrella purchase and the hospital purchase of the implants? The umbrella/retail model is virtually frictionless, the OR implant model is riddled with manual, sclerotic, and time consuming processes. It’s better information verses information constipation. When the umbrella was purchased, when virtually anything is purchased at a retail level, the information regarding the purchase is created digitally and then information is used to create a more perfect consumer experience through an efficient supply chain. The implant supply chain is characterized by manual inputs, data errors, walled off end usage demand data, and weeks or even months to complete the business cycle.
And don’t give me that an umbrella is different than an orthopedic set or tray – every other industry has solved this supply chain problem through scanning at point of use and digital management of complex assets.
Healthcare providers desperately need to follow the path of the retail information revolution. It will yield more choices, better prices, greater efficiency, and better results for patients. The best place to start with regard to orthopedic implants in the OR is by digitalizing the information around their products. This includes scanning at point of use in the sterile field to initiate the supply chain, and digital management through scanning and software for auditing the trays before and after use.
For implants that are used in the sterile field, that means Summate Technology and Scan Ready sets and trays. Summate can turn any tray into a scannable asset, digitalize the supply chain, and unleash the power of more perfect information for the healthcare provider industry.
The problem right now is the the providers don’t seem to want to push this change, even though they hold most of the cards. And the device companies? They’re rather fond charging 150.00 for that 5.00 screw. When will the light bulb go on for the providers?
Stay tuned….
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