Point, Click, Buy!

Total reliance on traditional purchasing can precipitate this and other administrative nightmares. For some long-term care facilities, this mode of purchasing falls within their comfort zone regardless of the occasional incon-veniences. But with new computer technology, Internet capabilities and growing user confidence, it just might be time for your organization to step into the world of cyberstocking via online purchasing.

Online purchasing (e-procurement) sites offer potential advantages over traditional purchasing methods. To illustrate, three e-purchasing organizations active in long-term care discuss some of its benefits within the context of their particular programs, offering advice and encouragement to those facilities considering the transition from traditional to online purchasing. All agree that the first step is to log on and test the experience firsthand.

Why bother trying? “Traditional purchasing generates a lot of paper which, in turn, opens the door for error opportunity,” says Steven Barnett, vice-president of marketing. “Our goal is to make supply purchasing a paper-free procedure that translates into cost savings by increasing speed and accuracy. Because of the point-and-click convenience, the purchaser can place an order, review it, send it on its way to fulfillment and quickly get back to resident care or administrative duties.”

For facilities that lack the required technology but wish to commit to the service, nursinghomedepot.com will provide the hardware (computer, monitor and keyboard) needed for Internet access. Barnett emphasizes that “nursinghomedepot.com is committed to working with customers in an ongoing effort to improve the design and usability of the Web site to more fully meet their business needs and requirements.”

As for the staffing required, Snarr says that the facility should decide whether across-the-board purchasing authority is designated to one person or whether each department does its own. In either case, he says, “It’s a simple task to reorder from the account history; this is something anyone can learn to do.”

But again, why bother? Snarr agrees that online purchasing is not for everyone. “Online purchasing is not for you if you like to deal with salespeople in your office or enjoy placing phone orders. But if you’re very busy, keep erratic hours and want supply purchasing to be quick and simple so you can move on to other things, then give it a try.”

McKessonHBOC.
A disadvantage of traditional supply management, as compared to McKessonHBOC’s e-purchasing solution, is suggested by Gary Keeler, president of the company’s Extended Care division. “Once supplies are ordered in the traditional fashion-through a person, phone or fax-the purchaser is almost duty-bound to call in later to check on the order’s status (e.g., what is back-ordered, how many of the products are on hand, shipping status, etc.). With e-procurement, such order tracking is simplified and needs to be done only if there is a problem.”

McKessonHBOC offers Supply Management Online (SMO), at www.mckhboc.com, and to minimize the chance of keying or other inputting errors, it has the e.COMETSÖ bar-code scanning program. Items in the storeroom or central supply area are supplied with bar codes for Telxon or PDA (personal digital assistant) scanning. After the desired items are scanned, the order is then sent directly to the facility’s computer, where it can be reviewed for back orders or substitution suggestions, and then sent for processing.

Direct Supply, Inc.
Robert Hillis, president and CEO, and Jason Marshall, vice-president of e-Business, elaborate on the cost-savings potential of e-procurement: “A lot of our customers were involved in procurement/re-engineering studies conducted by a large accounting firm in 1993,” says Hillis. The study focused on cost in terms of paperwork-accepting paper invoices, matching up invoices and sending them to accounts payable. “The study showed that per-transaction costs associated with those procedures were estimated to be between $50 and $125, while the average purchase was $350,” reports Marshall. He notes that purchasing online can dramatically reduce that overhead.

To better customize its services, Direct Supply operates with three business-to-business systems: DSSI, serving large long-term care corporations; DSSI Express, used by the smaller chains; and Direct Supply Network (found at www.directsupply.net), mainly used by independents. A person in any of these settings can become adept with the system after some basic training and a little experience, says Marshall. This adaptability is key, Marshall suggests, because of the typically high turnover in long-term care; as many as eight different people might be using the system to input orders from various departments, instead of having all purchasing funneled through one person, he notes.

Hillis predicts that in five to seven years, every nursing home will be ordering the bulk of its supplies over an online network. Certainly it won’t happen overnight. These e-procurement organizations agree that traditional purchasing will continue to segue into e-procurement systems, much the same way that the fax machine became a standard business tool. Twenty-five years ago, the fax machine was cutting-edge technology; today, most businesses wouldn’t think of attempting to operate without one.

As far as these companies are concerned, e-procurement has proven successful, given the proper equipment and training. And, to them, this means it is only a matter of time-and not much time-before it will become the preferred method of supply management. NH