Supply chain executives discuss strategy, innovation and resilience — and their biggest lessons learned

How do you balance short-term operational demands with long-term strategic initiatives in supply chain management?

Tritch: We go through a long-range planning cycle along with annual goal setting and strategy sessions to check in against the plan. This allows us to assess (and balance) if we’re spending time on the right things that support organizational goals and move the needle. Sometimes it’s easy to get caught up in only being responsive to urgent issues and needs, so it’s important to have guiding principles and dedicated time to focus on the things that will not happen on their own to ensure we’re pushing forward in areas of strategic importance and help us maintain and grow competitive advantages.

Bagley: We have four pillars that guide our short- and long-term strategy in building a best-in-class supply chain at UCHealth. The first is talent development and succession planning. We have a Lean Six Sigma Green Belt course where junior team members in the field take on a logistics or process issue and develop solutions. One team member decided to look at why we had so many overnight packages coming into one of our hospitals. She analyzed ways to change that, which resulted in $300,000 in savings.

The second pillar is shared services — what services should we build and operate, including potentially a consolidated service center. The third is cost improvement: How we partner with governance teams to support change and accelerate standardization of products and rationalization of strategies. The last pillar is digital transformation — we have to break out of legacy siloes and eliminate manual processes to have a more integrated supply chain function.

Speaking of digital innovation: How do you leverage technology, such as ERP systems, AI or IoT, to enhance supply chain efficiency and visibility? Are there any emerging technologies or trends that you’re particularly excited about incorporating into your supply chain strategy?

Bagley: We recently went live with INFOR cloud suite in April 2024. We have its core supply chain functions implemented, but step one of our digital transformation is to ensure that tool is implemented at an optimized state and then fill in the gaps around the aspects it doesn’t provide like demand planning and forecasting. We did a pilot for a tool to integrate our Epic EMR documentation and Infor ERP contracting to automate our bill only process, which is a big pull right now. We’ve had amazing success with that pilot, and we’re rolling it out throughout the whole system as we speak. The key is to build a framework for full digitization, which will then allow us to layer in AI and automation.

Tritch: We’ve always taken an approach of “people, process, technology” — in that specific order — when working to achieve our goals and solve problems for the organization.

• We hire and develop the right people for the organization and the work.
• We develop lean business processes and standard work for a consistent approach to waste minimization or non-value-add activities.
• And then we layer technologies onto the people and processes to support them.

It’s always important to have well-defined problems and processes before you incorporate technology to be sure it’s helping and not just adding steps or confusion for technology’s sake.

Over the past few years, we’ve completed a significant foundational systems transformation to move to modern cloud software tools across the clinical and business domains. We standardized across our health system on Epic EMR, Oracle Cloud ERP, Strata Accounting, and Kronos time and attendance. We’ve worked hard to implement this core base and examine where it’s necessary to supplement these core tools with other specific technology to support our teams. We’ve been a longtime user of ARC Helios for point-of-use inventory management, leveraging both barcode and RFID, and we are currently piloting some exciting new electronic shelf labels with push button ordering capabilities.

We’re also supporting AI innovations across the clinical domain with solutions like ambient clinical documentation tools, and we’re looking at some potential applications in supply chain for contract management, customer service and training support.

What steps have you taken to ensure supply chain resilience in the face of global challenges, such as natural disasters or geopolitical issues?

Tritch: Resilience continues to be a critical and growing focus for us. We’re currently assessing tools to help us keep up with disruptions and manage and monitor issues more effectively. We’re also working to build strong knowledge retention and robust processes to ensure all key steps are followed when managing disruptions — both the immediate issues and the follow-up and closeout. There’s often value left on the table during disruptions because everyone is focused on the immediate operations, but it’s important that we have resources focused on optimizing costs and proactively working with our supplier partners on how to be nimble and resilient in our planning and execution. We’ve seen great progress with our key distribution partner Cardinal Health in how we collaborate to look at forecasts before and after a disruption to improve our shared forecasting and planning efforts. That’s allowed us to create solutions that leverage each other’s strengths in managing disruptions.

Bagley: Resilience is still tricky, which is why we’re investing in that second pillar of shared services, particularly around building a consolidated service center. I thought we were making great progress and then we got punched in the gut with the recent IV solutions issue after the Baxter plant was destroyed. Part of the problem is there's no partnership with competitors in manufacturing. If they all just ran another shift, we wouldn't have had this problem. But the fact is you can’t have too much dependence on third parties, which is what we’re trying to fix. There are areas where we’re doing well — we have plenty of PPE and warehouses with critical supplies. But we have a long way to go before we’re truly a resilient network. I'll do my piece of it, but I think there is a significant piece in industry that's completely missing.

What role does sustainability play in your supply chain strategy, and how do you measure success in this area?

Bagley: When you’re looking at incorporating better sustainability, it’s not just, “Hey, we have to change the way the doctor is doing things" — it's, “We have to change how we're doing things as a system.” For example, we looked at OR waste and standardization, and I had an ops team member examine everything that was being thrown away in a single OR throughout the course of a day. There were six garbage bags full of supplies. We evaluated how much money that translates to, and it was a surprisingly large number. I then shared those findings with my executive steering team to get buy-in from the system, which went well beyond what supply chain could do on our own.

It took about a year to socialize the process of cleaning up the procedure carts — not opening anything that you're not going to use and removing items that are unopened. With just that clean up, we saved roughly $2.5 million.

Tritch: Sustainability is a growing focus of our organization, and supply chain has played a lead role. I’m the executive sponsor of our cross functional sustainability team called Team EAR3TH (Employees Aligned to Reduce, Reuse and Recycle Toward Health). We’ve also recently created a dedicated role within our supply chain team focused on sustainability and associated process improvements. We recently saw significant progress in partnership with our anesthesia providers on reducing the use of anesthetic gases that are most harmful to the environment, and we’re working to drive down overall utilization in line with clinical guidelines.

What key lessons have you learned as a supply chain leader that have contributed to your success?

Tritch: I had the benefit early on of learning from some great supply chain leaders who have shaped my approach. One of the sayings I like to follow and tell my team is, “At the end of the day, no one remembers how much you saved — they remember if they liked working with you and if you got the job done.” Now that doesn’t mean we don’t have key savings goals we need to drive to, but it does mean that you can’t drive savings at the cost of relationships and other factors.

I also pride myself on going to Gemba: Seeing the operations firsthand and interacting with the frontline teams to inform our approaches and strategies. I also try to be a servant leader. We need to set up people for success, establish a vision, strategy and goals, and then work to help teams remove barriers and solve problems.

Communication also is a fundamental skill and tactic that can’t be understated. The ability to communicate in various forms and fashions and ensure the message gets across. You should ensure your team understands their “why” and leverage stories whenever possible to help with the stickiness of the communication.

Bagley: Early in my career, my focus was on being an exceptional individual contributor — the technical expert. But what I've learned, painfully, throughout my experiences is that I'm the orchestrator of talent and not the doer anymore. I can't be the expert in all things, but I can surround myself with excellent talent, develop that talent, and then ask them to step up and lead in those areas. What I think I do relatively well is setting a vision and a framework to execute and then providing space for leaders to grow and develop and get us to that next level.

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