eWorld - NHSSC Presentation Sept 2008 v2

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  • We listen

    communicate

    focus

    then deliver

    Selection & Implementation of an Integrated Sourcing & Contract Management Solution

    Bryan Semple, IT Solutions Director, NHS Supply Chain

    Taking Care. Nationwide

  • Presentation Outline

    NHS Supply Chain - Introduction

    How?

    Implementation Challenges

    Why?

    Business Benefits

    NHS Supply Chain Opts For An Integrated End-to-End Sourcing and Contract Management Approach Why and How?

  • Who Are We?

    NHS Supply Chain is the integration of NHS Logistics, part of NHS PaSA and DHL

    DHL appointed 1st October 2006 to manage NHS Supply Chain on behalf of the Department of Health

    Global Organisation

    500,000 employees

    Express, Logistics, Mail and Financial Services

    Healthcare sector in the UK [Bridgwater DC and Hospital Logistics]

    Life Sciences Global Pharma and medical companies

    320 employees

    Sourcing and Contracting entity on behalf of the NHS

    Originally all Non Pay Spend

    Specific to Utilities, Pharma, Agency and Services

    Civil Service culture

    1500 employees

    Built an infrastructure and capability around NHS Supplies organisations

    Dedicated purchase to pay systems and online ordering

    6 Distribution centres

    Transport Network outsourced to CEVA

    Unison Membership

  • Our Vision & Value Proposition

    We aim to be the best value, and most innovative, healthcare supply chain for the NHS

    Private homes

    Nursing hom

    esOur span of influence and control

    DistributionCentres TrustsConsolidation

    SupplyCentre

    Sourcing &procurement

    Raw

    mat

    eria

    ls pr

    oduc

    tion

    E-commerce

    Supplier ServicesProcurement Services Logistics Services Supply Chain Services Patient Services

  • C5bn Market11 TFR3 Categories

    Incl Theatres, Medical/Surgical, Clinical Markets, Food & FacilitiesCapital Equipment & Maintenance

    Logistics Services

    ServicesUtilitiesEstatesPharma

    Agency ServicesTransport

    How have we evolved?Our Market

    NHS Supply Chain has exclusive scope from the DoH that covers over 5bn of market. This represents 28% of NHS Non Pay spend*

    *Pharma accounts for 57%

    NHS SC Networked and Transacted

    Legacy PaSA Frameworks and Direct contracts

    Available Market New Categories

    1bn

    0.6b

    n3.

    3bn

    5bn

    Market Current Profile

  • Complex Procurement Landscape

    NHS procurement in

    practice

    NHS Trusts- provision of services and related purchasing -

    Departmentof Health

    - strategy and funding -

    CollaborativeProcurement

    Hubs- cost efficient

    procurement at regional level -

    Centre forEvidence Based

    Purchasing-clinical evidence

    gathering -MHRA

    - product regulation and safety -

    NICE- cost and clinical effectiveness -

    NHS Institute- disseminatinginnovation and best practice-

    NHS PASA- pricing and procurement -

    NPSA- monitoring and

    improving patient safety -

  • Savings Business Case & Actual To Date

    Generating savings for the NHS is at the core of our business plans.

    We are committed to delivering over 1bn savings over the 10 years of our contract Cash releasing savings of 9m in year 1 [Target 1m] Cash releasing savings forecast in year 2 18m

    [Target 5m]

    We procure once only on a national scale, leveraging NHS buying power Audiology - 25,000 annual cash savings per trust Imaging & Diagnostic capital - 14m savings for

    NHS forecast in 2008

    2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 20160

    150

    300

    450

    600

    750

    900

    1,050

    1,200

    1,350

    1,500

    1,650 BC NHS Savings

    Actual NHS Savings

    2007 2008 20090

    20

    40

    60

    80

    146

    ~~~

    9m16m

  • IT Enabled Business Transformation

    BUSINESS TRANSFORMATION

    DHL has invested over 25m in the first year of the contract

    People and Training

    IT Infrastructure & Enablers

    Process re-engineering

    Continue to invest in 2008 / 2009

    New Infrastructure

    IT Change programme

    Capital Managed Services

    New Category development

    IT ENABLERS

    Catalogue Management / eCommerce Upgrade

    Move from 50,000 to 650,000 products

    Catalogue Enrichment

    33 million order lines pa across 250,000 requisition points and growing

    Legacy Systems Replacement

    RESUS over 20 years old

    Constraint on new business services (e.g. HDS)

    Lack of operational effectiveness and efficiency

    Business Intelligence and Data Management

    Data Quality

    Actionable Insights for suppliers and customers

  • Transforming Procurement Key Challenges

    People

    Process

    SystemsData

    Market Info

    Suppliers

  • People

    OUTCOME New organisation aligned with business imperatives Commercial training for all Clear management goals and incentives Still some way to go!

    CHALLENGES Inherited 80+ personnel from NHS PaSA Recruited another 30+ Organisation structure not aligned with business Mixed culture (let and forget) Commercialisation Training

    People

    Process

    SystemsData

    MarketInfo

    Suppliers

  • People

    Process

    Systems

    Data

    MarketInfo

    Suppliers

    Processes & Systems

    OUTCOME Single end-to-end Way of Working for all core processes One system with flexibility and rules to drive consistency Building in and improving best practice, template driven Management dashboards and alerts to drive performance resource balancing Fully hosted and managed solution, minimising investment and increasing flexibility Increased use of eAuction, driving additional benefits

    CHALLENGES OJEU Compliance Lack of consistency across teams Fragmented systems barrier to process integration Lack of overall ownership Cost of multiple systems and hand-offs Lack of management visibility of activity and

    resources Limited use of eAuctions due to cost and

    complexity

  • Data

    OUTCOME Contract, Price and Product Data captured once at Tender stage Catalogue populated directly from Contract information Contract Lifecycle Management - Integrated change control Alerts, warnings and workflow

    CHALLENGES No single source of data Core systems supplemented by > 1000 MS Access

    databases

    Change Control Lack of discipline in keeping products, contracts,

    contacts and prices up to date

    Poor Quality Multiple manual rekeying, cut and paste Lack of supplier visibility

    Speed (lack of) Weeks to upload and validate contract information

    and populate catalogue

    People

    Process

    SystemsData

    MarketInfo

    Suppliers

  • Market Intelligence

    OUTCOME Sophisticated data scrubbing and spend analysis tools providing additional

    insight to wider NHS market Identification of gaps and opportunities for additional contract Monitoring of uptake and non-compliant spend One version of the truth

    CHALLENGES Limited understanding of wider marketplace Lack of visibility of existing contract spend Poor uptake and compliance management Limited business case development support and

    benefits tracking Multiple interpretations of same data leading to

    poor and inconsistent decision making Limited manual spend analysis capability

    People

    Process

    SystemsData

    MarketInfo

    Suppliers

  • Supplier Management

    OUTCOME Single supplier portal for all tender and contract management activities Workflow and alert management integrated with contract lifecycle Integrated view of supplier and contract performance for supplier and buyer

    CHALLENGES Fragmented communications channels Inconsistent mechanism for responding to

    tenders and completing responses Lack of total visibility of supplier performance No coordination of supplier and buyer activities Limited supplier visibility of tender pipeline

    People

    Process

    SystemsData

    MarketInfo

    Suppliers

  • Solution Selection and Implementation Timescales

    Jan-March 2007 Requirements Definition & Short listing

    April-May 2007 Conducted user workshops and gap analysis

    Jun-Aug 2007 Conducted trials and Blueprint validation exercise

    Sept 2007 Commenced project and detailed design phase

    Mar 2008 System delivered and testing completed

    Apr-Jun 2008 Data migration, training and system configuration

    30 Jun 2008 Go Live

    July-December 2008 Tender Launch, Coaching and Contract Conversion

    We applied a rigorous and thorough process to our selection of Intenda which had to satisfy both NHS and DHL policies.

    We ran workshops, conference room pilots and even some live trial events, including an eAuction for Baked Beans!.

    Intenda were the only company able to demonstrate a full end-to-end tender and contract management solution and who had a thorough understanding and hands-on experience of OJEU and government procurement

  • Benefits and Remaining Challenges

    KEY BENEFITS Full OJEU compliant end-to-end solution covering full procurement lifecycle

    Reduced manual effort to set up and execute tenders

    Fully integrated contract management and workflow

    KPIs and performance information

    Integration with NHS-CAT, ensuring data integrity

    Fully hosted environment with minimised investment in hardware and software

    REMAINING CHALLENGES Ongoing coaching and standardisation of ways of working through tender lifecycle

    Outstanding data quality issues with legacy contracts

    Continuous improvement and increased productivity

  • The Future - Managed Procurement Services for Trusts

    Hosted Procurement ServicesOn Demand

    Provides a hosted solution for single tenders and procurement events only

    Consultancy support provided by Intenda to set and manage events

    Access to OJEU compliant, governed and best practice tender management for ad hoc major tenders by non member bodies

    E.g. Hub bulk IT capital purchase for member trusts, not covered by existing NHSSC or regional contracts

    Hub & Trust Sourcing and Contract Management Solutions

    Uses shared infrastructure to provide a complete ISS environment covering all aspects of Sourcing and Contract Management (not eProcurement)

    A Separate instance will be set up for each client based on the standard NHS Blueprint and environment

    Customisation to this environment at individual trust cost. Major rework will require a separate instance and higher costs

    Trust/Hub Advantagesn Significantly lower cost of entry and running costsn Uses standard template and processes proven within NHS environmentn Access to best practice advice and experiencen OJEU compliance/Governancen Efficiency of tendering and contract management activityn Visibility of spend and customer requirements

  • Contact Details

    For further information on the use of ISS at NHS Supply Chain contact

    Herman FickManaging DirectorT: 0845 4683632 E: herman.fick@intenda.net

    Bryan SempleIT Solutions DirectorT: 01773 724000E: bryan.semple@supplychain.nhs.uk