Streamlined, Central Purchasing Improves Quality
Virtua has initiated a strategic supply chain model that includes direct manufacturer contracting and direct distribution opportunities.
The model focuses on opportunities for market share enhancement through committed volume and proper utilization through aligned incentives resulting in total value through resource management.
We measure the effectiveness of Virtua and our suppliers by utilizing a Balanced Scorecard approach. The effectiveness metrics include quality, patient satisfaction, employee satisfaction, physician satisfaction, community health, growth and financial.
Virtua has a centralized purchasing department and a central distribution facility that services all of our 33 locations. Virtua is unique because we have one item master catalog which leverages the products across our entire network. These standardized products are distributed to all service areas, such as hospitals, home care, long-term care, physician offices, and ambulatory sites. Our clinical and business practices are integrated with all stakeholders involved in the decision-making process.
Navigating Virtua’s Resource Management Process
The Virtua Resource Management Process uses a collaborative approach including end-user involvement that spans across the Virtua network to help ensure successful product conversions and high compliance levels.
Interdisciplinary teams conduct evaluations to determine a product's performance in meeting minimum acceptability standards and qualify products prior to moving forward with a request-for-proposal process.
Product award decisions are based on a number of factors and not exclusively on price alone. Primary drivers to decision-making are based on a total-delivered cost scenario. Other important decision points include manufacturers' value-add propositions, direct distribution opportunities, support on Resource Management utilization issues, and community health education support.
Virtua enters strategic supplier relationships with vendors based on this model:
- Shared vision, mission and values
- Focus on total value through resource management initiatives
- Focus on market share enhancement through committed volume (>90%)
- Develop direct contracting models
- Develop direct distribution
- Align the incentives (leverage combined resources)
Virtua uses a resource management process for supplier access:
- A collaborative approach involving teams comprised of product/service end users (e.g., clinicians), purchasing, logistics management and resource management personnel
- End user involvement spans across the Virtua network
- Interdisciplinary teams conduct evaluations to determine a product's performance in meeting minimum acceptability standards and qualify products prior to moving forward with a request-for-proposal process
- Supplier contract award decisions are based on a number of key factors focused on our Balanced Scorecard approach measured by Six Sigma process improvement tools
- Primary drivers to decision-making are based on a total delivered cost scenario
- Other important decision points include manufacturer's value-add propositions, direct distribution opportunities, support on Resource Management utilization issues and community health education support
- Successful product conversions and high compliance levels ensured
Goals & Objectives
Virtua establishes measures and metrics of mission critical factors impacting the organization's strategic direction and goal of providing an outstanding patient experience. These factors include the following values of the Virtua STAR initiative:
- Excellent Service
- Clinical Quality & Safety
- Best People
- Caring Culture
- Resource Stewardship
Important Vendor Resources