Thursday 22 May 2014

The NHS eProcurement Strategy: What’s Not Mentioned in the Recent NHS eProcurement Strategy? (Part 3/3)

By Scott Pryde

Today I wrap up this series of posts on the NHS eProcurement strategy, if you've missed the earlier commentary, you can access the posts here: Part One, Part Two. Today I’ll be taking a look at Social Networking, Knowledge Sharing & the Virtual Procurement Landscape.

New networking and communication technologies are disrupting industries and empowering consumers. From social networking and Google, to Wikipedia and Amazon, access to knowledge and expertise has never been greater. The power of these solutions is yet to be applied to NHS procurement. Whilst ambitious in scope and scale, the eProcurement strategy says little about the adoption of new emerging information sharing solutions.

The most innovative trusts are already looking beyond the traditional procurement and eProcurement models to a virtual procurement landscape where access to not only data but also information and knowledge is a given. Where expertise is no longer in a single trust or hub but where the expertise of an individual can be more effectively shared throughout the system.

A category manager in one trust will be able to analyse a wider NHS dataset on a complex category, collect market research, engage clinicians and develop a strategy which goes on to deliver savings. Except now rather than one trust or region benefiting – all of these resources can be shared across providers. It doesn't matter where that person is based.

Extending beyond the traditional boundaries of buyer and supplier relationships, sharing more information with suppliers will result in a closer strategic relationship between NHS and industry particularly in demand and inventory management as well as in building real world business cases for technology adoption.

I suspect that it is in this area that the real disruptive changes to the efficiency of NHS supply chains will be established.

What about primary care?

NHS procurement now has a role in not just 34% of NHS spend but 80%. Commissioning in primary care has the potential to drive the most profound efficiencies in the system by aligning commercial incentives with patient outcomes and driving providers to reach beyond the current model of care to place outcomes and efficiency first.

Many of our NHS eTendering / contract management customers are in primary care. Where we have analysed CSU CCG data, we have found that the worst procurement data and information gap is in primary and social care across the whole public sector. This data deficit may indicate a deeper problem, the absence of strong commercial governance and sustainability.

At the same time, we know that some of the greatest conflicts of interest in the system originate in primary care between GP’s commissioning pharmacy and other GP services. We also already know from the US that reimbursement tariff based ‘gaming and leakage’ are issues that have been revisited time and again and where technologies exist to manage the resulting inefficiencies. These focus around merging spend and financial data at each tier in the healthcare supply chain.

I suspect that primary care is way beyond the scope of the current Procurement and eProcurement strategies, but it is worth bearing in mind that for those at the procurement front lines in primary and secondary care that there will be emerging new benefits in working more strategically together in the coming years to truly harness demand led efficiencies.

Supply chain technologies will be key to identifying and enabling these efficiencies and few have even begun envisioning what the procurement and resulting technology landscape will look like.

Wrapping up

The disruptive and breakthrough savings methodologies of the next wave of NHS procurement will be found at the intersection of enabling technologies and improved capability of procurement leaders and executives.

There are already path finding trusts who have implemented most elements of the new eProcurement strategy, as well as those who are also looking to newer technologies and a virtual procurement landscape in the future.

There is a lower tolerance amongst most for solutions that add no imminent value and an increased pragmatism and willingness to co-operate between some of the largest trusts.

I suspect that best practice and innovative use of eProcurement solutions will continue to be driven by innovative trusts who find new ways in implementing new solutions and technologies who want to measure and improve performance and who know how to use them to deliver savings.

If you’d like to find out more either visit BravoHealth, connect with me on LinkedIn, or join us at the HFMA Conference Delivering Better Value Procurement where I’ll be presenting a session on Delivering Savings from Spend Analysis and Benchmarking.

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