Taking The Supply Chain Pulse
St. Onge’s Healthcare Hall of Famer and industry icon, Fred Crans, chats with leaders from all areas of healthcare to discuss the issues of today's- threats, challenges and emerging trends and technologies in a lighthearted and engaging manner.
ENGINEERING A BETTER HEALTHCARE SYSTEM
We provide comprehensive planning and design services to develop world-class facilities and highly effective support services operations. Our capabilities in hospital supply chain consulting include applied industrial engineering, lean methodologies, systems thinking, and operations research to enable improved patient care and staff satisfaction. We are proud to have worked with over 100 hospitals, including 18 of the top 22 in the US, utilizing diverse design strategies, post-construction implementation, and change management.
Taking The Supply Chain Pulse
The Power of Supply Chain Leadership
Amanda Chawla, Senior VP and Chief Supply Chain Officer at Stanford Health, shares insights on transforming healthcare supply operations from transactional processes to strategic networks. Recognized by Gartner for excellence, Stanford's approach focuses on people-centered leadership, organizational agility, and continuous reinvention to meet evolving healthcare challenges.
• Supply chain transformation requires examining organizational foundations across people, process, and technology
• Stanford's strategy involves insourcing operations, creating new departments, and developing technology roadmaps
• "Supply chain is not a chain" but a network of interdependent activities serving every department
• Successful leadership requires building trust and demonstrating value as a strategic partner to clinicians
• Financial viability challenges require healthcare organizations to focus on efficiency and value-based operations
• Organizations must choose between waiting for disruption or becoming disruptors through innovation
• Failure should be viewed as part of the innovation journey toward advancement
You can contact Fred at fcrans@stonge.com with guest suggestions or topic ideas for future episodes.
Hello again everybody. This is Fred Kranz from St Onge coming to you with another episode of Taking the Supply Chain Pulse. Our guest today is Amanda Chawla, the Senior Vice President and Chief Supply Chain Officer at Stanford Health in Palo Alto California. In Palo Alto California, amanda's organization had just been voted one of the top performing supply chains in the United States by Gartners, and Amanda herself was a Bellwether League AMR Award winner in 2024. And since I like to read what my good friend Rick Barlow wrote, I'm going to read a little bit of the description. It says Amanda Chawla, vice President and Chief Supply Chain Officer Stanford Medicine, palo Alto, california, dismisses and declines to embrace conventional thinking, sacred cows and the status quo, which she feels represent a trio of business constraints that simply get in the way of daily operations and solving crisis that erupt. Now that's pretty cool. That's pretty good. Did you tell him that or did he make that up by himself?
Speaker 2:I'd say that's definitely Rick's words and what Rick would have said.
Speaker 1:There was more.
Speaker 2:I'll go with the latter.
Speaker 1:There are two different writing styles there's Rick's and there's mine. You know, Rick writes like Gabriel Garcia Marquez and I write like Ernest Hemingway. So it's great to have you here, Amanda. How are things in Palo Alto?
Speaker 2:Well, great to be here and in Palo Alto and probably elsewhere around the country, it's never a dull moment.
Speaker 1:Yep. So who is the most famous alumnus from Stanford?
Speaker 2:Who's the most famous alumnus at Stanford? Oh, that's a tough one. You're starting off with tough questions. I don't know, fred, sorry, go ahead.
Speaker 1:Well, Tiger Woods for one, yeah yeah. Probably the most famous would probably have been Herbert Hoover. You know, he became president.
Speaker 2:That is a good fact.
Speaker 1:John Elway, and I don't know if John McEnroe went there or not. He may have gone there too, but a lot of really neat people from Stanford. It's a very prestigious and renowned organization. And then, of course, you yourself went to the Kellogg School at Northwestern and I used to get in an argument with Conrad Emmerich. I used to get in an argument with Conrad Emmerich who is Conrad, is always giving me trouble about the University of Miami when I would throw up the? U and I would say, oh yeah, you went to Northwestern, your school's logo looks like a Z turned on its side, oh ouch.
Speaker 2:So, anyway, that having been said, what does the Gardner Award that you recently won mean to you and your organization?
Speaker 2:You know, I think about it as an acknowledgement of the transformation journey that Stanford has been on.
Speaker 2:Like many organizations, we've been on a multi-year journey to really transform the way that we operate, the way that we serve, the way that we engage, the way that we do our work, fundamentally and really rethinking what supply chain means, not only to our organization internally but to the industry as a whole. The recognition that Gartner has given is, you know, to me an attribute and an acknowledgement of that transformation and that ongoing success. I don't think it's hey, you've got it, you're there. It's an acknowledgement of the work that you're continuously doing and working on it. Also, for us, you know, our biggest strategy has been centered around our people and the work that our people do, as kind of our secret ingredient. So to me it's an acknowledgement of the great leaders and the great team members that we have across the supply chain and really the level of partnership, not only within Stanford but also across the industry, with partners, suppliers, but also our colleagues. So to me it's a good recognition of all of that. So to me it's a good recognition of all of that.
Speaker 1:Great. So when you began at Stanford back in 2016, I think it was what were your short and long-term goals, Did you?
Speaker 2:envision yourself in the role you're in today. When you started back then, well, my short-term goal, fred, was to have a baby. So when I started at Stanford, I was very pregnant. So a couple of months after joining Stanford, I actually ended up going out on maternity leave. So that was my short-term goal. But no, all joking aside, it was pretty much you know how. For me, stanford was a new organization. The first thing I needed to do was assess our organization. We had gone through some transformation and leadership transition, and I didn't become the head of supply chain until after I came back from maternity leave, at which point it was a fundamental re-review of how we were operating and what we wanted to be. And so my plan at Stanford was a one to two-year plan and nine years later, with pretty, with, uh, pretty much a nine-year-old uh, I'm still here.
Speaker 1:So you accomplished both goals having the baby, yes, yeah.
Speaker 2:So now uh a preteen.
Speaker 1:Very yeah. The good times are on their way. So, like I say, when you began, where did you see that changes uh were needed? Uh, at Stanford, you know what areas did you see required immediate attention and then long-term attention, and how did you go about working on that?
Speaker 2:yeah so. So my view, whether it's supply chain at Stanford or any other business or any other department your work, work really falls in the buckets of people, process and technology, and I think about when I take on a new department or a new function what's the scaffolding of this department and how strong is the foundation? Just like when we're buying a house, we don't actually look at the paint on the walls, we actually look at how strong the foundation is. At least that's what you should be doing, and so that's where I started.
Speaker 2:My work in supply chain was taking a look at our organizational structure, looking at our leadership, looking at the reporting relationships, looking at who we were servicing, how we were servicing them and where we set up for success. And ultimately, the answers to all of that was there needed to be massive changes and we needed to evolve, in which the very first thing we did was essentially a reorg of the leadership team as well as the staffing. Half of our department was outsourced. We insourced that. We took a look at our technology and our roadmap, which didn't really exist, so we put one together and we created net new departments, not because this is what other hospitals were doing, but because this is what we saw the future, as we obviously I you know talked to a lot of colleagues in the industry.
Speaker 2:We talked with Gartner, we talked with many, many organizations to get their perspective. And I would say, every couple couple years since then, fred, we reimagine ourselves. We reinvent ourselves Because what we designed two years ago was relevant two years ago and what we're designing today is relevant to today and the future. And I think having that agile methodology and that agile thinking and that willingness to not only embrace change but lead with change and lead with clarity and purpose, I think has been a key differentiator with our team. And the second component I'll say is supply chain is not a chain. We're a network of different activities and interdependencies, and so, whether it's serving the OR or whether it's serving you know department like marketing or strategy, at the end of the day, all the different aspects of the supply chain organization needs to come together, and so one of our big viewpoints is that we need to operate as a network with interdependency in serving our customers.
Speaker 1:Yeah, you say that supply chain is not a chain, and that's a common thread. I have heard this. There are many supply chains in health care. There's a med-surg supply chain, there's a pharma supply chain, there's a food service and hospitality supply chain, and so and I think one of the other things that folks that come from the outside in don't realize is the political atmosphere and the leveraging of the different constituents in the organization, many of whom and Stanford is you know you're in an academic environment there, so you've got folks that have some pretty good kick with leadership. How difficult was that to establish yourself as a credible person, to start building all this?
Speaker 2:So, you know, I think, regardless of where you are, it's the saying, as my six-year-old will say to me and she said this actually to me before mommy actions speak louder than words. And so you know, if we take that joke aside and we actually, you know, practice it it's really to me, developing the relationship through winning the trust of others, demonstrating that you're in it for the right reason, demonstrating that this is a partnership, no matter our backgrounds and where we come from or how long we've been in the field, doesn't necessarily mean that any one of us has all the right answers. Oftentimes we don't as leaders. It's about really that great convening, and I see the role of the chief supply chain officer as that great convener, and so part of my strategy, and continues to be a core focus of mine, is I am a great convener of different peoples and I am a dyad to everyone in the organization.
Speaker 2:Our department services every single department of the organization. Department services every single department of the organization, and when you're over there with the mentality of let me provide value to you and let me understand what your priorities are, the receptiveness is much greater. Is it perfect? Absolutely not. But it is that willingness to partner, that willingness to engage and see supply chain as a strategic and operational partner does increase, Because oftentimes we are not the smartest people in the room. We're working with clinicians, individuals that have noble price awards and so forth, and so really coming in with the mentality and the approach of how can I serve and what really is our goal, what really is our mission, and really supply chain functioning as an enabler for the rest of the organization. And so when you operate in that way and you lead in that way, the willingness and the receptiveness to the multiple chains or the multiple kind of tentacles of supply chain in its outreach is much more effective.
Speaker 1:Well, you know, listening to you talk, it sort of points out. I've always thought the supply chain was regarded the way it deserved to be in every organization, and by that I mean if you had someone that was like yourself, that was building collegiate and collaborative relationships with often difficult people and doing that successfully, you were perceived as being strategic and important to the operation from a long-term strategic perspective. If you were just ordering stuff and kicking boxes to get the stuff to the point of use before you got yelled at, you're going to be looked at in a much more transactional fashion and I've been so impressed with you folks, the next generation of supply chain leaders we just talked about Conrad Emmerich, yourself, marisa Faribault. You know the young folks that know how to go about making a good sale for the value of the supply chain, and I just want to commend you on that of the supply chain and I I just want to commend you on that.
Speaker 1:Um, but 2025 is, you know, the next. Every year, every year, is the most exciting and challenging year in the history of the world, but I would say that on november 8th of 2024, we made certain that, no, that 2025 was going to be uh, there's going to be more action than most so. So you live in California, where you have to have 25 locks on the bathroom door so it doesn't blow off when an earthquake hits. You live in the most difficult state as far as regulations and restrictions and everything else. Half the state is burning down on any given moment, and when it's not burning down, the rains that come afterwards cause mudslides. What things are you seeing as the top three issues that you need to contend with in 2025?
Speaker 2:So let's start with. The elephant in the room, which is, I think, an issue not only for California but across the country, is this financial viability issue, where we're seeing hospitals that are the haves and the have-nots. We're seeing increased financial pressures. Tariffs continue to be a conversation daily, by the minute and involves the bottom line is we are, as organizations, having to increase our work around the conversation of value and efficiency, hospital kind of regulation and oversight that's coming in that's going to actually limit high-cost hospitals a certain percent of increase year over year on terms of Medicare charges. We've got that.
Speaker 2:Being an academic medical center, we know that on the university side there are potential impacts from NIH grants and funding there to endowment to taxes and so forth that we need to be aware of, to endowment to taxes and so forth that we need to be aware of. I already mentioned the tariff components. There's also conversations about federal Medicaid cuts. There's conversations about 340B and site of service.
Speaker 2:At the end of the day, one of the greatest pressures I think that hospitals are facing, and our hospital included, is really this question around financial efficiency and value value of care to the patient and the service that we provide, this ongoing conversation about capacity and access and patient flow continues to be a core component of focus. But from a supply chain perspective, our work is really going to sit at that efficiency scale. From an organization perspective, it really does come down and it is all about the patient. But how are we providing that most efficient care at the highest value? So the definition of value is continuing to expand. So that's another major trend that I see, but I would put those two as the top two trends.
Speaker 1:Yeah, and it's almost frightening because if you look at Becker's every day you know it says five hospitals in Florida shut down, eight hospitals in Ohio are about to close. I mean, it's just story after story of bad news. And then the other part of this is that if at the federal level they're successful in reducing services, guess what? They're just shifting where those services have to come from, because we still have 345 million people in this country that have got to have care, and then that puts a strain on. I think you're probably living in the most taxed state in the country, I would imagine. I'm just guessing here.
Speaker 2:We probably are.
Speaker 1:And how does your administration see that, and are you sort of developing contingency plans for what ifs, to deal with what would happen if the sky really did fall?
Speaker 2:I think you have to. You have to be in tune not only with the present, but also the future and where things may go and where things may go. And so you can be the organization that waits for something to happen and wait for something to happen to you, or you could be a pioneer and a leader in the space that you need to be. And for us, you know, that pioneer component is going back to our mission and our purpose, as well as our values, and making sure that, whatever is going around on around us, that we are staying focused to our mission and our purpose, which is really about healing the community and healing patients while advancing cutting-edge medicine. And so, when we think about it from that perspective, our work around research continues to be an imperative.
Speaker 2:Our work around the care delivery and the care models have to be something that we continue to lean in on because, to your point, we've probably got more patients wanting to come into our system than we can actually handle. So how do we provide them the best care and the most efficient and value-driven way? And we have to fundamentally continue to lean in and change the cost of our infrastructure. Where do we have redundancy? Where do we have non-value-added work, this conversation around technology. We've got to lead in that area.
Speaker 2:Again, it goes to my comment earlier you can wait to be disrupted or you can be that disruptor, and I think in some cases Stanford's kind of cultural aspects is we want to be that disruptor and we're actually doing quite a bit in the AI and technology space, whether it's with operations or whether it's with how we care for patients and make it easier for our clinicians and our staff to be able to work at the top of their license. You've got to do all of that. So to me it's a balancing equation more than anything else, but also thinking, and not only planning for the future but executing strategies and plans today for what the future may hold.
Speaker 1:So, that being said, how would you characterize both your personal and your organization's outlook? Is it hopeful, is it optimistic, is it reserved and the jury's not in yet, or what?
Speaker 2:So I'll start with my personal perspective.
Speaker 2:I think you have to go in with the perspective about what areas can you directly influence and what you can do every single thing that may be coming in terms of communications or different perspectives or different things and be very thoughtful about your approach to things and your execution and being grounded on your purpose and your mission.
Speaker 2:And so, from that perspective, you have to be optimistic. We're in it. When we think about health care, we're in a people business. At the end of the day, regardless of your role, whether you're the chief supply chain officer or you're the director of supply chain or you're the CIO or you're the CEO ultimately we're in a people business. At the end of the day, we're caring about people and the way that we service and I use the word business very intentionally, because we have to be able to make a bottom line, to reinvest in our organization towards the mission that we're serving. And so, for that reason, I don't think any organization has a choice other than to lean into this conversation and really have that optimistic approach of how do we solve, how do we lean into the problems that we need to solve for and the way in which we need to do them?
Speaker 1:Yeah, there's another statement that you probably your six-year-old daughter will probably tell you, and that is no margin, no mission.
Speaker 2:She hasn't said that one though.
Speaker 1:Well, she'll figure it out at some point.
Speaker 2:She'll get there.
Speaker 1:So we're nearing the end of our conversation. I wanted to say one thing. I saw that you had worked at Marin General Hospital at one point, and I'm a big Frank Lloyd Wright guy and I know that Marin County has got one of the last buildings designed by Frank Lloyd Wright and that's what the community center right. I've been there, I've been in the area and never gotten to see it. I envy you for having the opportunity to have seen that. So what did I forget to talk about? That you'd like to throw two or three cents in about. Did I forget to talk about?
Speaker 2:that you'd like to throw two or three cents in about. You know, I think the biggest piece is it's about how we lean in as leaders during this time of change and during this time of evolution. And just a remembering that we're kind of in it together and, you know, picking up the phone, calling one another, getting perspectives, I think is truly helpful because no single one of us knows the answers. I think the second component is understanding the priorities of your organization and how do you fit in to provide that value. You know, traditionally you talked a little bit, fred, about you know how supply chain can be viewed and I do truly believe it's up to the leaders in terms of how you position your organization and the value that you provide to the organization and thinking beyond the traditional boundaries and supply chain.
Speaker 2:As your non-labor expense leader, your right hand that sets your expense management strategy, just like the chief human resource officer sets the people strategy in the organization Our job as leaders is to set the expense management strategy for everything that's not labor. And so thinking about those things, thinking about what's important and really how do you partner with your colleagues and other executives and then how do you inspire and really lead your teams towards not only the present but really the future and being able to, you know, or being bold, I would say to make change and being willing to fail. We've failed many times on many different things that we've tried and getting up and trying over again. That's how we're going to advance and being open to that.
Speaker 1:Well, amanda, I'm certain that with you at the helm, stanford is going to continue to succeed, and if you can make it through the morass of California, any place else would be easy by comparison. Thank you so much for taking time out to talk with us. It's been a real honor to have you on the show and I saw last week I was at a two-day session at the Cleveland Clinic and I'm just. This is completely out of context to our conversation, but I want to put it in there for you and for our listeners. They have a four-minute and 34-second video that you can find on YouTube and it's called. The title of the video is Cleveland Clinic Empathy and you know empathy is why we're here. It's got very few spoken words in the video, but I would recommend that you take time out and watch it and I would recommend to all the people listening in that they watch it too.
Speaker 1:Amanda, thanks so much for taking time out of your busy day to be here, and I wish you the best and hope to see you soon. Thanks again, everybody, for listening to our podcast Taking the Supply Chain Pulse, subscribe, follow and give us your comments for topics or improvements and if you know some people that you think we should be interviewing. Please tell us about them too. I can be reached at fcrans C-R-A-N-S at stongecom. We'd love to hear from you. Thanks again. See you next time.
