Melbourne successfully digitizes healthcare supply chain

From using drones to deliver medical supplies to using Artificial Intelligence (AI) to guide clinical decision making, the healthcare industry has made great strides in leveraging cutting-edge technology in efforts to ultimately save or improve people’s lives.

One recent example of the use of technology in the industry is Melbourne Health Logistics (MHL)’s Supplier Improvement Pilot Project. The project involved 10 Australia-based small-to-medium enterprises (SMEs) and aimed to address the challenges in supply chain and inventory management through digitization.

For those who participated in the project, there were three key areas to focus on. Namely, these include the implementation of data capturing technologies, improving data quality and introducing suppliers to the use of Electronic Data Interchange (EDI). Recognizing that such data-driven initiatives might be challenging for some suppliers that were not born digital-first, MHL partnered with the federally-funded AusIndustry Entrepreneurs’ Program to guide suppliers in building digital capability.

At first glance, being data-powered can indeed be overwhelming. It would definitely take suppliers some time to reorient their business strategies and change the way they provide services. It could take great effort, but going digital is the only way forward in meeting the broader needs of the industry.

Take EDI as an example. EDI can be thought of as the standardization of business documents. All too often, documents get ‘lost in translation’ and backlogged along the supply chain.

To greenlight documents as it passes on from one organization to another, administrators have to manually key in certain key information. With EDI’s automated capabilities, the time of information exchange can be drastically reduced. Further, there will be a reduction in expenses, particularly for paper storage, printing, postage, and mailing. By eliminating the need to manually enter orders, EDI also helps minimize data entry errors.

Health Purchasing Victoria (HPV), which partners with public health services in identifying and procuring goods for hospitals across Victoria, is a leader in this project. Its Director of Data and Systems, Rob Setina, is confident about the benefits that such data-driven initiatives can bring.

Singling out EDI, Setina noted that ‘efficiency gains are the stand-out benefit for suppliers to use their resources better’, and that by adopting EDI, suppliers are in fact futureproofing their business.

He is also confident that suppliers would be receptive to technologies such as EDI in the next few years. “At the moment about 25 percent of purchase orders come through EDI […] I believe that we can reach 50 percent within three years.”

Aside from leveraging technology, the project also highlighted the need for one national product catalog to store product information used by health services throughout Australia. Currently, there are over 20 catalogs used just in Victoria alone.

Concerning this, Setina said that with a common catalog, suppliers only need to update one catalog each time they have a new product, or when the specs of products have changed. This, he concluded, was a ‘huge efficiency boost’.

---

---

---

---