MISHRA: What is unique about the W. P. Carey School of Business (ASU) to be named the most innovative school in America by the U.S. News and World Report for five years in a row?
SCHNELLER: We have paid very close attention to the skill and analytic needs of employers for employing graduating students who are able to scan their environment, develop skills and “hit the ground running.” We have developed programs and courses that cross normal disciplinary lines. Great examples include our programs in business analytics and global logistics. We have challenged our faculty to engage in practice inspired research – research that quickly solves problems that are real world. We have developed courses that bring together students from different disciplines – such as my course on innovating in the health sector which had students from business, nursing and engineering. We have shifted resources to solve problems of immediacy – such as our COVID-19 saliva test and laboratory, developed and operationalized by our Biodesign Institute.
MISHRA: What was the essence of the Health Sector Supply Chain Research Consortium (HSRC-ASU) you pioneered 25 years ago?
SCHNELLER: The HSRC won a national award for its innovative structure – bringing together Group Purchasing Organizations, Distributors, Suppliers and Providers to engage in supply chain problem solving.
MISHRA: What were the highlights of the accomplished from the collaboration over the decades?
SCHNELLER: In our early years, Jon Ketcham and Mike Furukawa, two talented economists, carried out the first assessment of gainsharing as a strategy to align clinicians, providers and payors. Another early project developed an application of the SCOR (Supply Chain Operations Reference) model to the health care delivery sector. We aligned with CAPS Research to carry out projects where learnings from non-health sectors could inform the health sector. Our work on standardization processes and value analysis, for professional preference items, looked at learnings from industries as diverse as automotive and construction – to think more deeply about issues relating to physician preference. We were able to advance a model that more fully integrates clinical practice and supply chain. The “top trends” surveys we published annually provided guidance to supply chain departments across the nation.
MISHRA: You have also developed the Fully Integrated Supply Chain (FICO) model which is grounded in learnings from GM, Intel, Philips in addition to the most progressive integrated delivery networks, such as Kaiser, Banner, UPMC, Mercy, etc. What can Life Sciences learn from your findings?
SCHNELLER: The most important foundation for a FISCO is the information platform – one that is characterized by accuracy, transparency and aligned with applications across the organization. Our research confirmed that industry best practice organizations are increasingly utilizing AI and other advanced analytic technologies to understand relationships that could not be uncovered without the data foundation. An important area we scrutinized was recalls of drugs and devices. Industry best practice organizations are utilizing AI to anticipate recalls before being detected in the field. Health care can employ these strategies to improve patient care and improve safety
MISHRA: What are the major takeaways from the two-year project you led regarding medical supplies for the Department of Defense which are applicable to handling the COVID-19 pandemic?
SCHNELLER: I served as the Principal Investigator for the ASU-MEDLOG (Medical Logistics) project which ended in July 2020 after two years. We provided support for the upgrade of the information technology and supply chain and logistics efforts to bring together the medical supply chains of the three services, as they endeavored to carry out the Congressional mandate for integration. As the COVID-19 Pandemic began, we provided DoD with six strategies, each accompanied by short-term and long-term initiatives in the areas of risk management, response to pandemic/disruption response and leveraging relationships with civilian health care systems to share supplies. I’m not sure that prior to COVID-19 there was a recognition of the great value that logistics, as practiced by DoD, can contribute – not just in time of war.
MISHRA: What are the top three challenges of supply chain management that can transform healthcare?
SCHNELLER: Developing a clear, concise and recognized understanding of the impact that supply chain management can have on clinical outcomes. Industry best practice organizations are beginning to accomplish this – utilizing analytics to assess product contributions to outcomes – with a focus on the episode of care. This is the pathway to realizing the relationship between evidence-based supply chain, evidence-based management and evidence-based medicine. For me, this is the new triple aim.
Transparency is an important key to moving forward. Information has not been readily or easily shared. Non-disclosure clauses have contributed to high costs. In the health sector, suppliers have not been seen as collaborators –the supply chains in provider organizations rarely interface with the supply chains in supplier/manufacturer organizations. This results in a lack of trust – so important to achieving a high level of performance for health care organizations.
Critical is the Successfull engagement of clinicians in recognizing and supporting (and in some cases leading) supply chain efforts. There is great a new understanding of the impact of SC on clinical practice because of COVID-19. There is a need to capitalize on this. Perhaps this is a time to impact medical school curriculum – so we have a group of clinicians ready to meet future disruptions.
MISHRA: Do the principles and practices of SCM help a professional rise to the top of an industrial organization?
SCHNELLER: The experience across the health sector, historically, is clearly, emphatically, unfortunately - “NO”! Supply chain’s importance following other disruptions, such as hurricane Maria and the challenges it posed to mainland provider supply chains was too quickly forgotten. SC in the provider side was pushed back to a cost/revenue center. Importantly, there are too few examples of transition from chief purchasing officer (CPO) to CEO.
MISHRA: How well are the objectives of Resilience, Agility and Sustainability being addressed by enterprises today in the COVID-19 world we live in?
SCHNELLER: Much remains unsettled – and hopefully more sound decisions will evolve as we reduce the level uncertainty about the progression of the pandemic. We are still uncertain about its depth, length and the shape of its exit. Perhaps ASU president Michael Crow is correct as he argues that this is just something we need to live with – long run. So, it is now time to address the term that has suddenly become a focal point of our vocabulary – the “new normal”.
- The new normal is not just about returning to the old normal. There is a great deal of discussion about the “new normal.” And there are multiple stakeholders – each – perhaps, having different visions – including senior executives, managers, boards, and innovators. This is a time of great opportunity. VC investments will start to flow into the delivery system. We need to watch this – not to just “follow the dollar’ – but to understand the opportunities as they, who understand risk and reward, evolve in their thinking.
- What replaces JIT? Well perhaps that thequestion for many supply chain leaders. California has mandated having 45 days of PPE inventory. How does one manage that? How to rotate stock. Who will take responsibility? And, of course, what is the cost. And further – what is the cost of not being prepared?
- One of the major GPOs has suggested having even longer reserves – Who does that? At what cost? With what kind of management?
- What happens to all of those “grey-market” companies that continue to produce masks, etc. Do they have relevance going forward? I have not yet seen the health sector developing the level of automation for supply chain as I have witnessed in other industries. Intel, for example, has done an amazing job of automating its contracting process. Many organizations are looking at the idea of “control tower” – a technology that can orchestrate all of those previously un synchronized technologies and applications.