October 2004

Data Cleansing Set to Deliver Supply Chain Benefits

As part of the CHI Connect project, Catholic Health Initiatives' supply_chain team is working with Inobis, a provider of data cleansing services, to establish single item and vendor master files. While this work is underway, reports created from the consolidated data are already identifying cost reduction opportunities across the organization. The supply chain team anticipates about $43 million in supply expense reduction with the implementation of CHI Connect, with the Inobis project helping to expedite the savings. "Our market-based organizations use about 38 different databases now, with different item numbers and naming conventions," saidJoni Rittler, director of supply chain infrastructure for Catholic Health Initiatives. "By cleaning out redundant and obsolete information, Inobis is able to consolidate and standardize all of that data. This will make it easy to see, systemwide, what we are buying; which manufacturers and distributors we are buying from; and what costs are being paid." At a system level, Catholic Health Initiatives has had to rely on purchasing data provided by vendors. "Now, we will have our own source of data for securing best pricing, contract negotiations, tracking manufacturer rebates and calculating contract administration fees," Rittler said. In fact, two market-based organizations have already received value from this work through the discovery of unreported sales by their respective distributors." This audit capability will generate cash recovery of more than $70,000 for the prior fiscal year and ensure that payments continue for qualifying purchases. Rittler expects the data cleansing to reveal some significant differences in the prices of products purchased by multiple marketbased organizations, even for contracted supplies. "Our group purchasing organization, Consorta, is constantly negotiating for new items and better prices," she said. "It can be difficult for a market-based organization to keep up with all the changes." The initial data cleansing process began last fall and will be completed by January I, 2005. Mter that, Catholic Health Initiatives will follow a biennial schedule of data extraction and cleansing while market-based organizations continue to move to CHI Connect. "The materials management and accounts payable personnel have been extremely helpful and valuable throughout this process, particularly in meeting some very tight deadlines" said Rittler. "It's exciting to see their efforts begin to payoff this early in the project." For more information, contact Joni Rittler at jonirittler@catholichealth.net.