Ochsner Health’s Régine Honoré Villain and her supply chain team acted quickly to procure supplies amid the early surge of COVID-19 cases in New Orleans. What she learned during that time will help Louisiana’s largest healthcare provider for future planning.
For Régine Honoré Villain, MPH, senior vice president supply chain network, chief supply chain officer of New Orleans, Louisiana-based Ochsner Health, the squeeze on supplies started in early March 2020. “Almost overnight, we started to see a pinch on supplies,” she said.
COVID-19 cases were first being reported in the United states in Washington State, and then the next big surge that made the news was New York. “We were two or three days behind New York, so we were surging at basically same time,” she said. “We experienced a pinch that perhaps others did not experience because of that timeline.”
Very early on, Villain said she and her team realized that they needed to shift focus on the way that they were procuring supplies. “I knew that the only way to sustain the kind of demand was to make sure that we secured additional inventory, perhaps from places that we hadn’t before,” she said. “So, it changed the way that we did procurement.” In the past, the supply chain team was somewhat regimented by going through regular channels with distribution, the GPO and trusted partners. “It became very apparent that we needed to break from that because everybody was flocking to the same people.”
The Ochsner team thought a little bit more globally. Direct sourcing became a thing that they latched onto right away, Villain said. “No longer did we have the luxury of time to wait for somebody – a distributor, third party or middle person – to get to us; We basically jumped the line and went straight to manufacturing entities,” she said. “We started to transact with them at a level that we hadn’t before.”
Then came the idea of thinking about alternate sourcing. Not only sources used in the past, but in different ways. For instance, Ochsner went to people like plumbers, because plumbers had access to certain bags that they couldn’t find in other places. Ochsner went to people who manufacture plastics in order to get containers in order to get bottles, because they were now making hand sanitizer. “All of a sudden, we started to integrate supply chain operations in a way that we hadn’t before.”
Essentially, Ochsner became its own entity within all of those areas, along with other areas like 3PL, Villain said. They started to do third-party logistics because they couldn’t wait for couriers or for distribution. Ochsner established a warehouse in the course of 24 to 48 hours and decided on how to run a fleet of vehicles. They rented trucks and then started driving.
The entire supply chain was disrupted in a way that they hadn’t thought about before, Villain said. “But frankly, when I think back about it, I really appreciated the fact that this event was forcing us to think outside the box.”
One of the biggest revelations was when the supply chain team reached out to local purveyors to get products. The response was very positive. The local breweries became de facto hand sanitizer producers. At the time of the surge, the local couture dressmakers and stores that produced clothing for Mardi Gras were idle, because it was right after Mardi Gras. They were going to be in a lull for a while. “But we found out a way to partner with them,” Villain said. “They challenged themselves to create masks, and then they started making gowns. Meanwhile, we started making face shields and goggles. It was absolutely amazing. Everything that was traditional was no longer, and everything that could have been perceived as a taboo or questionable in supply chain became mainstream.”
Maintaining supply continuity
Villain said the warehouse built for the pandemic isn’t a full-fledged warehouse, “but it’s definitely an operation that will allow us to decompress the supply chain,” she said. “In the past, just-in-time was something that everybody aspired to. You wanted to be lean, mean and efficient. Well, there’s something to be said for having redundancies in a way that actually balances your availability to have supply on hand, because anybody who was truly entering into the pandemic saw themselves having difficulties riding through the waves.”
Fortunately, Ochsner was able to enter into the pandemic at a place of strength because they had started to ramp up before 2020. “We anticipated that there could be an issue based on the chatter that I was hearing out of China,” she said.
In October-November of 2019 the industry was dealing with disruptions to the supply of surgical packs. Then Villain said they began to hear chatter about a sickness in China. “My thought process went to ‘Well, if these people are getting sick, that means they’re not going to work. That means a factory is not producing.’ So if those factories are not producing, it’s likely going to be a while before they start ramping up. And then generally every year, it’s known that factories will close for the last two weeks of the year.”
Villain said she had a feeling that they needed to get their hands on as much as possible so that they wouldn’t be struggling at the beginning of the following year. “I call it a Spidey sense,” she said, like Spiderman. “My Spidey senses were tingling. I just had a feeling, an inkling that I needed to act quickly and make sure that I had people on board, and I needed to understand chain of custody. I started formulating the questions and forcing the issue with some of my suppliers. I would ask them ‘Where are you getting your supplies? If you’re getting your goods from China, I want to know, because if that’s the case, I want to ramp up and make sure that I have enough to keep me level for at least a couple of weeks.”
When COVID-19 started to hit, Ochsner was in a position of relative strength, because of the early accumulation. “It was almost unintentional, but the foreshadowing really helped us. It allowed us to create momentum in order to continue to supply the hospital and take care of our patients and caregivers.”
Future planning in the “almost” post-pandemic era
The future for supply chain will be centered around creating resiliency and redundancy, Villain said. “It may sound like those two concepts are the same, but they’re not.”
You want to make sure that you have options as a supply chain, she said. Strict standardization is gone. “We need to make sure that we have options, because if one line of products is compromised, then the entirety of the chain is compromised,” she said. “That’s why the future is also stronger collaboration with internal stakeholders, folks like our infection control specialists and our physicians. When it comes to technology and biomed, we have to make sure that we’re partnering with external stakeholders, so that we can understand how can we come together differently, and be able to execute quickly on decisions.”
But the speed to execution is paramount for the future. “You don’t have the luxury of time; you cannot wait to make a decision for a week.”
At the at the height of the pandemic, Villain was telling her team that when they entered the day with a question mark, needing to make a decision, she wanted them to exit the day with an exclamation point. “We’re asking ourselves a question in the morning,” she said. “But we need to be able to process it that same day, so that we have a plan to execute, because every day was the equivalent of losing a week. So, the speed to execution has to be there. The resiliency has to be part of the narrative, and ensuring you have redundancy is also important.”
As an industry, nearshoring needs to be explored, Villain said. “How do we make sure that as an industry, we don’t allow ourselves to be subject to the rigors of distance?”
Amid the height of the pandemic, Villain said at some point when you wanted to procure something, whether or not you were willing to pay for it, you couldn’t get it because it couldn’t get to you in time. Things were being shipped over the water because of the way they were bought – tons and tons of heavy items like gloves. “The quantities that we were buying you couldn’t put on a plane; You had to put them on a boat,” Villain said. “You’re waiting 4,5,6 days. Then custom issues arise. We cannot afford to be in a situation where we’re depending on that process much. Well over 75% of everything that we were getting was coming from overseas. So now we’re thinking about, what do we need to do in order to create opportunities to make sure that nearshoring is a reality?” There’s a lot of things that go into nearshoring, Villain said. “But certainly, it is something we’re thinking about as an industry. We just need to understand it better. We need to lean on each other a little bit more intentionally, and create those connections, so we can truly create a network of support, so that we can have the redundancy