To change is to alter, transform, or take a different direction than the current process or path. This was the premise behind the creation of the Supply Chain Solutions’ Logistics Program at Mayo Clinic. We recognized we must take control of shipping and transportation costs in a rapidly changing healthcare industry.
“You can’t manage what you can’t see or measure”. This phrase reflects one of the greatest challenges for supply chain managers when faced with cost containment initiatives. The overwhelming volume of supplies and equipment flowing through various supply chain channels makes management of shipping and transportation very difficult.
We watched the retail and manufacturing industries take control of their inbound transportation expense with great success. However, this meant change management within those industries. These industries realized they had to break down existing paradigms with reluctant shippers, as well as educating internal contracting and purchasing groups on the importance of contracting terms and purchasing strategies with regard to freight. Mayo Clinic started to enact this same paradigm shift within our own organization.
Mayo Clinic took control of our inbound transportation management through changes in our purchasing practices. We modified purchase orders and contracting terms to support an inbound freight program. We also moved away from an institutional allocation model for shipping and transportation and moved to a cost allocation model which placed responsibility for spend directly into the hands of the end user. These changes resulted in year over year sustained savings.
Due to our success, Mayo Clinic began to recognize that we were in a unique position to help others and bring this same management model and philosophy to other organizations.
The Supply Chain Solutions’ Logistics Program is a change management strategy and solution – not simply another 3PL transportation management program. We use our experience and knowledge to help our members implement change management within their organization to achieve control and savings over their shipping and transportation spend.