Taking The Supply Chain Pulse
ENGINEERING A BETTER HEALTHCARE SYSTEM
Taking The Supply Chain Pulse
Karen Conway and the Power of Collaboration in the Healthcare Supply Chain
Can supply chain operations really drive optimal health outcomes? That’s what we asked Karen Conway, a highly respected global supply chain executive and value-based healthcare strategist. Join us as she sheds light on her diverse career path, including her transition to her consultancy, Value Works. Karen passionately discusses the need to harmonize supply chain operations with value-based healthcare goals, aiming for improved health outcomes and underscoring the importance of collaboration and lifelong learning.
We also delve into the innovative strategies employed by Rush University Medical Center to tackle workforce shortages and boost operational efficiency. By integrating technology and optimizing logistics, they've set a powerful example of how strategic supply chain management can pave the way for a more robust healthcare system. Our conversation dives deep into the significance of data standards, evidence-based decisions, and the broader value of supply chain operations beyond just cost-cutting. Finally, Karen emphasizes the crucial role of multi-stakeholder collaboration and resilient relationships, especially in times of crisis, sharing heartfelt stories that illustrate the indispensable human element in supply chain management. This episode is a must-listen for anyone looking to understand the evolving landscape of healthcare supply chains.
Hello again everybody. This is Fred Kranz from St Onge coming to you today with another episode of Taking the Supply Chain Pulse. We happen to be recording on Memorial Day and we happen to also have one of my favorite people in the whole world as a guest Karen Conway, probably the most accomplished individual person I know. I would tell you what she does and what she has done, but we usually only talk for about a half hour. On her LinkedIn site, it says that Karen is a global supply chain executive, value-based healthcare strategist, leading collaborative innovation to advance health, equity, environmental sustainability and systems and organizational performance, and that's only part of what Karen is. I'm so excited to have you here, karen. Why don't we start off by having you tell us about your journey to where you are today and actually where you are today? Because you have not updated your journey to where you are today and actually where you are today because you have not updated your LinkedIn page since you left your former employer, so I couldn't get any good information off it.
Karen Conway:Got it, got it Well. First of all, you're too kind, one of my favorite people, and a very memorable Memorial Day to you, and I realize people will be listening to this later, but that's you know, thinking of our veterans always in our hearts, and so I happen to be in Oceanside, california, right now, and the rest of the time I live in Colorado Springs, colorado, which are two beautiful parts of the world, but also where we have a tremendous military presence. World, but also where we have a tremendous military presence. So I don't know where to start. I've been around a long time, fred, so I, you know, I kind of began my career in healthcare, really, as a biology major. I was either going to go to the Serengeti Plain and work with the animals there, or I was going to be a pathologist.
Karen Conway:I am a true believer in John Lennon's line that life is what happens while you're busy making other plans, so life kind of took me in some different directions. I've been a journalist, I've worked in government and regulatory affairs, and most of my time in the last 25 years, though, has been really focused on the health care supply chain. I have a lot of background in continuous quality improvement and systems thinking, and I think you know, supply chain is a system within that system and really working to manage and optimize the use of the resources in healthcare. So that's where I've been working for GHX for the last, either with them as a consultant or for them as an employee, up until March 1st when I left the company. But I'm still very focused on the things I was doing there, which is focused on what's the role of supply chain in advancing the objectives of value-based health care.
Fred Crans:Well, you gave me a real condensed version of everything that was you know, because your bio has got to be like mine. They both look like war and peace for crying out loud. But so your email address now is at valuedeliveredorg. Could you explain what that is?
Karen Conway:Sure, absolutely Well, value Delivered is actually the name of a column that I've been writing in healthcare purchasing news for the last 13 years, but it's also really tied to, as I said, kind of work in supply chain and the delivering of value.
Karen Conway:We're doing more than delivering products. We're delivering products and services but really aligning with that which is going to create the most value, not only for the organizations that we work for but, most importantly, the patients that we're serving. So I've created a little company called Value Works and that is really again a bit of a think tank and a consultancy, and what I really enjoy is bringing together various stakeholders, particularly providers and suppliers, but other stakeholders within their organization, the clinical and the financial resources. And how do we come together and really look at how do we do our work together and how do we understand our common objectives? Because, you know, in a system everybody has kind of their own specific, you know what works for them in their different nodes in the system. But the system itself has to work together to deliver that value and, quite frankly, I think in health care the optimal output needs to be optimal health.
Fred Crans:Very good, I agree, I sent you questions in advance, okay, and I didn't say I was going to ask them in the order I sent them, though it occurred to me. I have seen you over the years presenting leading panel discussions on a wide range of topics and from my perspective in my opinion you are absolutely the best prepared person I've ever seen when it comes to leading a discussion. What's your secret?
Karen Conway:Well, first of all, your comments are, you know, good thing, this is a podcast because I'm blushing a lot, but you know, I think I love I love working with other people, talking with other people. I think you know maybe that comes from the reporter in me and that background as a journalist. But I have to say, everything I know in healthcare and everything I've done has been as the result of learning from other people. So when I you know so, I spend a lot of time.
Karen Conway:I'm also a researcher. I like to read, I like to understand and I think one of the things I try to put you know, connect the dots and understand if you've got a little bit of it, you know this information plus this information plus this, what's it going to come together and do? But know, when I'm moderating panels, you know all of that comes from the time I've been able to spend with people beforehand and having those conversations and listening to the unique perspectives that they're bringing and then trying to understand how their perspective complements or maybe is different from or might change the opinion of somebody else. And really it's more about facilitating others, having that constructive dialogue and I learn from you every time I see you, so that's great.
Fred Crans:So today we're going to be talking about the strategic supply chain and I had thought that, since you're always so well prepared, I was not going to send you any. I wasn't going to give you a heads up, I just wanted to see how you could go without getting a heads up. But I knew you'd do well, so I sent the questions. But it occurs to me that we're a country that likes a civilization, perhaps that likes catchphrases. So we come up with these catchphrases that sound like they should be intuitively obvious to us, but really, when it comes to defining them, it gets a lot more difficult.
Fred Crans:I would say that resilience is something that comes to mind. What is supply chain resilience? Well, you get about 50, 60 different definitions of it when you start talking about it. I would say the same thing is true about the concept of the strategic supply chain. So what I thought I would do is ask you to sort of break it down and see how you apply that concept to different areas of activity in the supply chain, you know, both in the present and in the near and sort of intermediate future. So how would you define the strategic supply chain as it relates to changes in how, when and where care is delivered, moving away from the acute care centered model.
Karen Conway:Sure, absolutely so. I think, just in general, when I think about strategic supply chain and we talk about this in a textbook that I had the pleasure of co-writing recently with Gene Schneller from ASU, jim Eckler, who supported shared services in Canada, and Yusuf Abdul-Asalam I'm sorry about that, yusuf, that I'm saying that wrong. He's a professor at the University of Kuwait. I have to get a running start on that one. Anyway, in terms of you know, I think about strategic supply chain is really tied to supporting the strategic objectives of health care, and so if you're sitting in a provider organization, what are those strategic objectives of your organization? What are those strategic objectives of your organization? And hopefully that is one that's really looking at that delivery of value over time.
Karen Conway:And that's what's pushing this move of where care is delivered outside of the acute care setting.
Karen Conway:We will still need hospitals, we will still need that level of care, but I believe that over time it really will start being the most complicated cases and the sickest patients that need to be in that kind of environment. We will certainly need emergency rooms and urgent care, but even those are starting to move out into standalone emergency rooms, et cetera. We need to deliver care. So you know, we've had a healthcare system that has been centered around the supply and expecting the patients to come to the supply, to the hospital, to the doctor's office, and we're recognizing that increasingly we need to be in the communities where people are living and working and deliver care in facilities that are most appropriate to what is needed. So we're seeing this push, for example, of certain kinds of procedures, an increasing number in ambulatory surgery centers, which are shown to deliver care at 40 percent less and equal quality, if not better.
Karen Conway:But what really interests me and excites me is the move of care into the community and particularly into the home and hospital level. Care hospital at home. I get a little concerned because not everybody's home is conducive to that kind of care. But it really will change the nature of how supply chain operates because you're going to have many, many more modes and it's a matter of what I would call supply chain is much more about resource optimization what are the right resources and that would be products and people and facilities and to match the needs of a very varying patient population.
Fred Crans:Yeah and that's the one thing that I don't think I put anywhere in my questions, but I think it's really important is historically, supply chain has been considered a support service, it's been considered a transactional operation and its leaders have been a second tier level leaders. And I don't think and I don't want to put words in your mouth, but I'd like to hear what you say I don't think that you could have a strategic supply chain unless you have strategic supply chain leaders that are included in all the conversations that develop the overall organization's strategic plan. What would you say about that?
Karen Conway:That's exactly right, fred, it really is. You know, when we launched the cost quality outcomes movement at Arm back in 2013, that was really when the Affordable Care Act was really being implemented and it was changing this focus of how hospitals and health care systems are reimbursed, which is a combination of quality and cost, and at the time we were trying to get the supply chain folks to understand that they have this greater role. It's not just about lowering the acquisition price of products, for example. It really is about understanding what delivers that value and understanding these changing requirements that their executive teams are operating under. At the same time, we were trying to get the executives within health systems to also understand that supply chain to your point earlier is not just an expense center, that there are greater roles that supply chain can play in lowering the total cost of ownership of products but increasingly lowering the total cost of care and improving that quality, that ability to deliver more accessible care, more affordable care, in an equitable manner.
Fred Crans:Yep, and as we make our progress into the future, there are all kinds of things out there once again that are almost, like you know, the whim of the day because we don't understand, we haven't integrated them into a plan. Believe that you have to have people working continuously together in a systematic approach to bring these things in appropriately so that they can affect the problems that they're trying to solve, one of which is the difficulty in hiring and retaining qualified, needed resources to do the job, especially clinical folks. What would you have to say about that?
Karen Conway:Absolutely. I'd like to start with AI. For example, I heard a statistic and I don't remember the exact numbers, but heard a statistic at the most recent SMI forum and they were talking about the number of the percentage of CEOs, not just in healthcare, but there was a significant number of health care represented in the total end and they were basically saying just do something with AI. Just, you know AI is important. Just I want you know, would tell their management team, tell me what you're doing in AI as opposed to. So we kind of go to those bright, shiny objects and I think AI can deliver some tremendous value. You know, with some cautionary tales around that in terms of how we're dealing with the technology, but you know we focus on the means as opposed to the end, and I think you know AI can, particularly with workforce. The biggest area I think we should be focusing right now it's not maybe the most exciting, but I think it's foundational is working to stop doing that which is unnecessary, but then also to be able to automate those repetitive tasks, so things like robotic process automation et cetera, taking that clerical burden away from the clinicians. Now in a lot of hospitals you've seen people take the clerical burden away from clinicians and give it to supply chain. Well, we have workforce issues in supply chain as well and there's a lot of repetitive tasks that we can be automating. So there's a lot of opportunity there automating. So there's a lot of opportunity there. So I think the other area with supply chain and burden I've seen some tremendous work by, for example, rush University Medical Center in Chicago. They've been doing work.
Karen Conway:They recognized that they also had a shortage of folks. They recognized that they also had a shortage of folks and so they were looking at where can we hire people? Well, one of the things they had identified is you know, if we can give people jobs in some of those more disadvantaged communities, that's one of the best ways to improve somebody's health. It's not about taking care of them in the hospital, it's actually give them a job, have a meaningful wage, be able to live in a better house in a better neighborhood, have access to good food, transportation, to even get to the doctor, et cetera.
Karen Conway:So Jeremy Strong, leading supply chain there, had actually gone to one of his colleagues who was one of his top performers and said you know, you live in this particular neighborhood, the West Side of Chicago. He said how do we hire more people? And this person said you know, I applied six different times and never got an interview because of the way our algorithms are set up. So they launched a program, with some help from the Tolman Foundation, called Jump Higher working with a not for profit in town where they're providing job, training, skills, soft skills, you know, customer service, communication, et cetera, but then they allow folks to shadow supply chain. I think Concordance also got involved in this and everybody who graduated from the program was guaranteed an interview and everybody, the humans in the process as well.
Fred Crans:One of the things that I see about robotics, for example. What we at St Onge do is try to help people solve problems appropriately. What you and I have seen in supply chain too often is what I call jeopardy purchasing, where a clinician will go to a conference and see a piece of new equipment have to have it. So my job as a supply chain guy is to ask the questions that will create that answer. I think the same thing is true with robotics. Oh, I see this. I have to have it. It may be absolutely the wrong application for where you are and the wrong consideration for the future. One of the things I think about the strategic supply chain is the strategy of really understanding needs as they evolve and making appropriate decisions along the way that incorporate the correct technologies at the time they need to be incorporated. Would you speak on that?
Karen Conway:I think that's where AI really can. You know. If we put first of all, we have to have the right data. So I think, again, not as sexy is really things like having standards. You know, I have worked a lot on UDI unique device identification what I simply say is let's call the same thing the same thing. Now, maybe as humans we're not going to be willing to call the same thing the same thing, but our technology has to. And if you put in the right kind of information, if we indeed have evidence about how products are performing, if we understand that this particular product works better on these kinds of patients I mean we saw that with blood pulse oximeters, where they were not reading as well if someone has darker skin so making sure that we've got that evidence in there and we can put those kinds of algorithms then and we can start understanding not just what products work best on what kinds of in, and we can start understanding not just what products work best on what kinds of patients, but we can start understanding where the care should be delivered. We can even start understanding what's the best route of transportation.
Karen Conway:Another example recently, you know, is starting. I've been working with a provider and supplier that started looking at ordering patterns and realized, in this particular case, they were ordering this, it was a suture. They were ordering it 50 times a month and so every time it was ordered it was put in a box, put on a plane, flown to the town where the provider was located. Now they're consolidating the orders one order a month, they're put on a truck far less environmental impact. And so you start understanding not just you know, here's the need, here are you know, here are the options. And the options are not just what the product is, but what's the ordering methodology, what's the transportation methodology, what's the inventory methodology, et cetera.
Fred Crans:Right, and that starts to help create situations where knowing your demand, knowing how to manage fulfillment, makes it possible, from what we do, to optimize the performance and the pass-through of the supply chain itself. That I think is one of the most overlooked opportunities in supply chain is actually optimizing the physical operation of the supply chain. We focus on products, we focus on price, we focus on a lot of stuff, but we don't ever take a look at how well we're doing the basic job of receiving, moving stuff through the process all the way, and that's that's one of the things that the strategic supply chain especially in in logistics and transportation, because care moves out to the, to the home Uh, what requirements do you have to meet there that you don't have to meet now? Uh, what types of thought process do you need to go through to uh make sure that we uh we do the best job we can there?
Karen Conway:You know, I think it's absolutely right and I think one of the things that's incumbent upon supply chain professionals is to make sure that those you know, those in leadership in the organizations that we're working for understand that this is more than an expense center Understanding there are levers they can pull beyond saying go get me a lower unit price for that particular product, et cetera.
Karen Conway:And once folks understand that and then understand some of the other things that they can do.
Karen Conway:And in healthcare specifically, I think you're going to see hospitals and healthcare systems under much more of a microscope.
Karen Conway:The government is really starting to look closely, particularly at not-for-profit hospitals and I think, if less you see the industry kind of coming together and changing how it does work, we're going to see more regulation, right or wrong, and there's going to be a lot more cost pressure, and I think this is the opportunity to get people to understand we can help with workforce issues, we can help with equity issues, we can help with environmental issues, and one of the areas I think that healthcare system CEOs and boards of trustees are going to also start to focus on is the cost of chronic disease, because we are seeing people particularly the poor and communities of color, chronic disease coming sooner. One chronic disease makes you more susceptible to another. More and more people have multiple chronic diseases and if you have chronic disease, every time you come into the hospital for care, you are a higher cost patient because you are a higher risk patient and we need to start understanding the impact that has on the performance of healthcare systems, if not on our whole national economy.
Fred Crans:Yep. So actually, what you're describing here is a holistic look at the impact of the way people live their lives, really. I mean, we call it health care and really it's probably life. Care is a better uh is a better phrase. But one of the things that interests me is, um, number one, the need to get clinical leaders involved in the supply chain. And number two, uh, the fact that as many years as I've been in supply chain, my interaction with the suppliers has been 99.9. My interaction with the suppliers has been 99.9% with their sales folks. I never, ever once, talked with a supplier's supply chain folks, and I think that's something that is sadly missing in the way we do business. I think we probably would be much better at what we do if we built relationships with the suppliers' supply chains as well. Could you talk about that?
Karen Conway:Absolutely, absolutely. You know, just in the same way that you know you get clinicians together and they start talking about better ways to do things when we get the supply chain operations folks talking together. Now, that's not to the exclusion of the sales folks. In fact, I think we need to have multi-stakeholder conversations, first of all, within individual organizations. One of the things I enjoy the most is when I can work with, for example, the CEO, the CFO, the chief supply chain officer, the chief medical officer, the chief nursing officer, and just have people start understanding how you know what matters to them. And then how do they, how do they understand that what they do? When I do this, it makes it better or it makes it worse for you. And those are when we start talking across organizations.
Karen Conway:So suppliers and providers sometimes people are doing things and just don't understand the system level implications that they have. But you also you want the salesperson there as well, because they're the ones servicing the organization. But they can start seeing why it's important to have their supply chain folks working. And then we start talking about how do we get to demand planning, as an example, or collaborative planning, forecasting and replenishment that have worked so successfully in other industries. But it requires that willingness to have those kinds of conversations. And then it requires us as an industry to do it in a more standardized way, because one hospital or health system sharing its demand data with a supplier isn't going to do anything. But if we could do that at scale, using better, standardized data and processes, we can make a significant impact for the better for everyone.
Fred Crans:Yep, and I think aligning incentives is important, because we all talk about trunk stock and I'll usually close your eyes and you're thinking of the orthopedic dudes are making more than the physicians they're working with and they're incented differently than trying to do the best job for everyone. And I think somewhere along the line, it's going to be necessary for incentives to become aligned among sales, among the suppliers and among the health care providers themselves.
Karen Conway:I think absolutely, and I think there's been a few experiments, if you will. I remember, maybe even 15 years ago, hearing about one supplier that had actually taken away commissions for their sales force. I think we might see something a little bit more. That's around. You know how in some organizations you have your personal, you know objectives by which you're measured, but your overall performance, and maybe a bonus that might be attached to that, is related to the overall performance of the organization. So if we can start understanding, you know you have your individual objectives but they're measured on other things and other, again strategic level factors.
Fred Crans:Yep, and you know, right now, with the changes in AI and robotics and all this other kind of stuff, changes are starting to happen. They're going faster than incrementally. They're going. And I think that the other thing, the largest growing demographic in this country is what age group? 85 and plus 85 and over. So the need to find solutions outside of acute care to be able to do all these things is going to require that we not only have to be strategic, but we have to be quick too as far as being able to anticipate, design a response and respond and implement those things, and the supply chain needs to be involved in that process.
Karen Conway:Well, and I think you know your ability to be more resilient to use your term earlier, you know to really bounce back from things that are unexpected comes from having those relationships. You don't you know, we did see, for example, clinicians and supply chain working much more closely together during the pandemic out of necessity. We saw public health and private health care having to work more closely together, but it wasn't pretty but we got there. But if you start working on things and establish those relationships and people understand we're working towards a common goal but we have our own individual objectives and we understand and we know one another when new challenges come together, it's having those kinds of trusted relationships that's so very there you go.
Fred Crans:You just said on the secret of life. I think in that one, it's with that one phrase when we know each other and I, I think that's probably the biggest barrier that needs to be broken down to make progress uh is to get to know other, to know each other as peers, as people working toward a common goal for the common betterment of the people. Now it's time for my bonus surprise question that I didn't ask you.
Karen Conway:Uh-oh.
Fred Crans:So now we're into the extra play here. I know this people that talking don't know this but when you were a young girl you met the whole New York Yankees one time in your backyard, your neighbor's backyard. Could you tell us what that was like?
Karen Conway:Oh, that was. That was amazing. I was about six years old and I was. We lived, we lived in. We lived in Lutherville, maryland, and it literally the road Seminary Avenue, and it was like the other side of the tracks where we lived because my friends, the Turleys had, they had a pool and a color TV and that was a big deal. I would go over and watch you know Wonderful World Disney on Sunday nights. But their father so I they the two boys were among my best friends at that age and their father was a pitcher for the New Yorkork yankees and I got to go to a pool party and all I remember is I I met, you know, um, mickey mantel, yogi berra whitey ford, and all I remember is shaking mickey mantel's hand and just looking up and he was just this towering giant to me as a six-year-old yeah, bullet, bob turley, that was, uh, he wore number 19 for the yankees, one of their, one of their big pitchers.
Fred Crans:That when you tell me that story I'm going oh, wow, I would love to have been there, love to have been there for that. So, like the final free throw is what did I miss? What would, what would? What point would you like to make that I didn't ask about?
Karen Conway:Oh, you know, I just think supply chain is such an exciting time, it's such an important role, but an under-recognized role and I think a lot of us good enough job yet to really get people to understand the strategic importance and to, I mean, the level of collaboration that was going on. You know with you know healthcare systems in the same area, talking about even sharing inventory, sharing data, et cetera. You saw competing suppliers come together as we were looking at how can we increase ventilator production, as an example, sharing information with one another. Now, there will always be proprietary information. I understand that, know in that competitive environment, but there's certain information that is proprietary, does give you a competitive advantage, and there's other information that doesn't. So I think it's a matter of really making sure we're telling that story to those decision makers, whether they're in, whether they're sitting in Congress, in a state legislature, you know, in the C-suite of your organizations, and getting them to recognize what we can do. That's our job and health care will be better for it.
Fred Crans:Well amen Karen Conway, bellwether League Class of 2023.
Karen Conway:You notice, I'm wearing my pin. I see you're wearing your pin.
Fred Crans:Yes, it has been so good to have you on the program, karen, and I'll tell you there are so many more things I think we need to talk about that you're one of the people, like Randy Bradley, that is on my multiple appearance list, so stay tuned. I'm sure I'm going to be asking you to come on again. Thanks so much for taking time out of your Memorial Day to speak with us. It's been a pleasure having you here, so thanks again and we'll see all you folks the next time. On Taking the Supply Chain Pulse.
