Downey comes to the new role from Vizient, where he oversaw supply chain operations while working with 35 acute care and 200 nonacute care facilities in its purview.
In November, the Cleveland Clinic named Steve Downey as its chief supply chain and patient support services officer. The position covers the health system's global supply chain and support services, including strategy and operations.
Downey comes to the role from Vizient, where he oversaw supply chain operations while working with 35 acute care and 200 nonacute care facilities in its purview. At Cleveland Clinic, Downey's domain includes 19 hospitals with 6,500 beds, and more than 220 outpatient facilities, with locations in several U.S. states plus Canada, United Arab Emirates, and England. The system handles 273,000 hospital admissions and observations, 217,000 surgical cases, and 8.7 million outpatient visits a year.
Downey relies on his educational background in technology and engineering, as he combines an analytic and systems approach to ensuring supply chain success. In December, Downey answered five questions for HealthLeaders on where health system supply chains are headed in the industry, and at Cleveland Clinic.
HealthLeaders: What healthcare supply chain trends do you see for 2022?
Steve Downey: Shortages are the biggest problem we all face today. What we'll see in the next year is health system leaders shoring that up as best we can. It's got a ripple effect when one shortage hits and we have to communicate across all of our sites about substitutes and find products. When I joined here, one of the early things I asked about was shortages, and how do we get ahead to be sure we have substitutes, making sure [we] have better resiliency. That [we] understand the risk points for making inventory decisions and sourcing decisions. There are technology components to it, like how to get inventory visibility. How do we partner across the supply chain better? All those sorts of things are going to be a big focus for us and other health systems next year.
HL: What lessons are hospital systems still learning from the pandemic?
Downey: COVID taught us that a well-functioning, informed supply chain that acts as a system is a strategic asset. Cleveland Clinic gets that. Clinicians can operate at license, we can be innovation partners, we can talk about pushing things forward in new ways to care, with new ways to get product to patients. As a strategic lever, [supply chain] drives all things with budget and executive alignment. When folks see supply chain at that level, it becomes more than just getting product. It becomes how do you enable everything we're trying to do operationally and clinically, and it becomes much more important.
It's so hard to have everyone using the same product, across in-patient, out-patient surgery centers and clinics. The best responses are systemwide. All these changes COVID keeps throwing at us, like a new hot spot or variant, or a backorder or labor challenge … how to keep that agility in place? We've had to have effective communications, good reporting. We've had to make fast decisions, rather than go back to the old way and slow things down.
How do you react quickly and keep that ability, and keep the supply chain agile to respond? It either starts that way or philosophically becomes that way. You make a decision that you want to behave like a system. So, then the executive teams carry it, the teams carry it. Part of it also comes from having respect for your peers and being in a peer network. Each institute knows each other, and they talk cooperatively all the time. It comes even when you're talking where our growth should be, where we're going to put in a new site, or whatever that you're thinking about that system. Whose item master are we going to use, or what strategic supplier relationships will we have?
HL: Where are the biggest areas for innovation in the health system supply chain right now?
Downey: The more strategic and smooth-running your supply chain becomes, the more you're able to move forward into those new areas. I look at how care continues to be a continuum. Supply chain will follow that. I see that happen a lot in other industries, like Apple having to do repairs, having to do e-commerce, having to supply Apple stores and big box stores, all similar locations with similar inventory but different systems. Supply chain in healthcare is heading that same direction. How do we cover that continuum of care? How do your retail pharmacies, your mail-order pharmacies work with an e-commerce approach to have product where you need it, where the patient expectations are that high for service, that you're making sure you have what you need wherever you are, and that the supply chain is able to execute on that? How do you integrate the need for supplies in all of those areas? There's room to take down the barriers, the artificial walls that are in place with all the different players in healthcare, like between suppliers and distributors, GPOs and health systems, and all kinds of different data sets. There is room for innovation there.
Automotive figured that out a long time ago. If you bring everyone into the same sandbox, and bring everyone into a common language, you help each other solve problems. For example, if healthcare got better at demand forecasting, would it help manufacturers plan their lot sizes better and distributors plan their inventory amounts better?
There's a lot of room for data management. And we see much better AI and [machine learning (ML)] now on that front. But as we move to cloud, and creating these broader data lakes, the more data you have, the more we have to be smart to get something out of it. So, if we have datasets that are now global datasets, where you're bringing all kinds of information together, you need smart systems to tell you what to look for.
HL: How will you use AI and ML to improve your supply chain?
Downey: The Cleveland Clinic has a culture of being data-driven. We have folks that are dedicated to analytics. Overall, in supply chain there are a lot of metrics. There are visible clear benchmarks. You know where you stand against other subgroups. You know where your benchmarks are and continue improving them. Dashboards bring things to the right level's attention, the right visibility for the right people. You have to understand your audience for the data. Are you speaking to an institute chair, COO, CEO, your own teams, to make sure it's presented in a way that is forward-looking?
I'm going to make sure our data is fast, accurate, complete, useful, and broad. All the supply chain data should be consistent and accurate across the globe, and uses all the right categorization and standards, so a rich data set. Because what we find is, as you try to do analytics or data merges, all your data needs to be clean. If it's out of a legacy system, that takes you a month to get it. And by the time you get to it, if it's not accurate, suddenly it's useless. That's where my comments about it being agile and fast come in. We're a highly automated and driven culture already, but I think we will see that just continue to grow.
HealthLeaders: How do you envision incorporating sustainability efforts into procurement?
Downey: Sustainability and diversity make for a strong supply chain. We're a strong advocate for the Healthcare Anchor Network, with team members dedicated to diversity and sustainability. How do we continue to grow that spend? When I think about sustainability, it's two aspects: sourcing and operational. Factoring sustainability into sourcing, working with supplier partners, ensuring we're buying the best sustainable option, the best resilient option, the best diverse option, that you're weighing all those factors. The other side is the operational part. How are you making sure, as the product gets to you that you don't overnight everything? So, you're not using air service you don't need. Or are there times we didn't leverage facilities close to each other? Did we expedite something that was just next door? Operational can be more sustainable. There always will be room there as well.
Deborah Abrams Kaplan is a contributing writer for HealthLeaders.
Supply shortages will continue in 2022; inventory visibility and understanding product substitution options will help.
Unify facilities and departments and promote better partnerships by viewing supply chain as a strategic asset.
Healthcare is a continuum, with extended opportunities for health systems to provide care and procure products and services.
Consider operations as part of sustainability; keeping needed products close reduces the likelihood of expensive shipping.