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Healthcare Supply Chain Security: What Hurricane Maria Taught Us

Posted by Fred Crans, Client Executive on 04.09.18

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Mention Puerto Rico to a baseball fan and you will certainly hear the name Roberto Clemente. If that baseball fan is from Cleveland, you will also hear the names Robbie Alomar, Sandy Alomar Jr., Carlos Baerga, Francisco Lindor and Roberto Perez – all of whom hailed from the little island in the warm waters of the Caribbean.

Mention that same island’s name to anyone who was watching the news and weather last summer, and they will undoubtedly speak about the disaster wreaked upon it by Hurricane Maria. On September 20 the storm virtually wiped out everyday life there for several months. Damage estimates for Puerto Rico and the U.S. Virgin Islands were upwards of $90 billion.

The devastation in Puerto Rico also heavily impacted the healthcare industry on the U.S. mainland and around the world. As it turns out, this U.S. territory hosts over sixty manufacturing sites for pharmaceuticals, IV solutions, medical devices, and other assorted products used daily and in large quantities by healthcare providers. It is one of the only locations where IV bags are manufactured, a fact that made headlines when Maria’s impact led to an immediate and extended shortage.

As many organizations scurried to fulfill product needs and keep operations going, Hurricane Maria became the impetus for a new operational tool – business continuity planning.

Most healthcare organizations buy their products through a distributor such as Cardinal, Owens & Minor, Medline, Concordance, etc. In normal times fulfillment from these folks is swift and accurate. Ask any healthcare supply chain leader where she gets her IVs from and she will generally name the manufacturer, e.g., Baxter. Ask her where the product comes from and she might say, “Baxter.” Ask her where it is manufactured and a blank look will cross her eyes.

Since Hurricane Maria, healthcare supply chain leaders are learning that such information can greatly inform the supply chain when disaster strikes a corner of the world. Key takeaways:

  • Know what your top 100-200 SKUs are
  • Know where they are made
  • Develop a Business Disruption/Business Continuation Plan that includes
    • Alternate sources
    • Alternate procedures
    • Creation of contingency stockpiles

Outside the ballpark in Pittsburgh stands a statue of the Great Clemente. Roberto Clemente’s got his last hit – his 3,000th – on the last day of the 1972 season. On the final day of that same year, Clemente helped load a plane filled with relief supplies headed for the victims of a terrible earthquake in Managua, Nicaragua. Fearful that the supplies might not make their way to the people for whom they were intended, he got on the plane to accompany them to their destination. Shortly after takeoff, the plane encountered a terrible storm and crashed, killing everyone on board.

The Great Clemente died while reaching out to others – his death a testament to the power of human kindness and the unpredictability of nature. Hurricane Maria was yet another lesson on the need for preparedness.

 

Sedlak has partnered with clients to mitigate the risk of supply chain disruption. Using scenario planning and “What If” algorithms, our experts have helped to create fluid Business Continuity Plans that keep the business going forward even in the face of the unexpected. To learn more, complete the Contact Us form below.

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