A degree in business or healthcare administration is still a good bet for those seeking a future in healthcare supply chain management. How about a supply chain degree?
It’s 10 years hence. 2028. You’ve got an opening in supply chain, and you’ve narrowed it down to two candidates. One has a degree in business, the other in supply chain management. Which one do you choose?
Jamie Kowalski, a Whitefish Bay, Wisconsin-based supply chain consultant, has an opinion, based on a career working with hospital clients, observing trends and conducting surveys of hospital/provider senior and supply chain executives.
Supply chain management has gained traction among the public, and there’s a growing interest level in it, says Kowalski, who served on the advisory board of the Marquette University Center for Supply Chain Management. Universities that are strong in the discipline are counseling students that accounting, finance and IT degrees are still valuable, but “there is a lot of opportunity in supply chain, as companies now recognize it as a key contributor to customer service and profitability. For healthcare providers, that also means sustainability.
“The challenges facing supply chain leaders, and the complexity and scope of supply chain, are such that we may get to the point where, if you don’t have a degree in supply chain, you won’t be a candidate,” he adds. A talented, hardworking candidate with a supply chain degree may beat out an equally talented competitor who has a degree in business, but not the supply chain specialization.
Christopher O’Connor
Christopher O’Connor, president, Acurity and Nexera, notes that traditionally, people have come to healthcare supply chain management with expertise in another discipline, such as accounting, a clinical area, or business in general, “That will change as the number of [supply chain] degree programs grows,” says O’Connor, who has served as an adjunct professor at Cornell University, Iona College and SUNY Binghamton, where he has taught undergraduate and graduate courses in healthcare and supply chain management.
And that’s exactly what appears to be happening.
Degree programs growing
“Before the early 2000s, academic programs for supply chain were rare, so most supply chain professionals were trained in areas such as finance or engineering,” says Abe Eshkenazi, CSCP, CPA, CAE, FACHE, CEO of APICS, a provider of research, education and certification programs in supply chain. “However, the field is gaining traction as a career path for students, and there has since been a significant uptick in supply chain management degree programs across the country.
“Institutions such as Michigan State University and Arizona State University offer undergraduate departments exclusive to supply chain management, while many other schools have combined supply chain with departments such as marketing, logistics or information systems. MIT, The University of Texas and the University of Maryland, among others, even have doctoral programs specific to supply chain management.”
Mike Schiller, CMRP, senior director of supply chain for the Association for Healthcare Resource & Materials Management (AHRMM), says that “supply chain degrees are absolutely applicable” for those pursuing a career in healthcare supply chain management. And there are plenty to choose from.
“There has been incredible growth in the number of supply chain programs available, with 74 colleges offering a business degree in supply chain, transport, or logistics – up from 56 four years ago,” says Schiller. Since 2010, enrollment in Southern New Hampshire University’s online MBA in Operations and Supply Chain has grown from 12,000 to 72,000, he says, sourcing a June 15, 2015, article in Fortune.
On a mission
The W.P. Carey Department of Supply Chain Management at Arizona State University is consistently ranked among the nation’s Top 5 for undergraduate and graduate programs by U.S. News & World Report, according to the school’s website. ASU offers undergraduate and graduate degrees in supply chain and logistics. Eugene Schneller, PhD., has been on a mission to incorporate a healthcare perspective into the programs.
Schneller arrived at ASU in 1985 to develop its healthcare management program. “One day, I was sitting with a friend – Larry Smeltzer – in the supply chain department, and I asked him, ‘Why don’t we do some research together? So little is known.’”
They sought and received funding from the National Science Foundation to explore the healthcare supply chain, and they spent the better part of a year talking to executives in hospitals, distributors, manufacturers, GPOs and others, to learn more about it.
At the time, Schneller knew of no healthcare management programs with a supply chain track, but he knew the need existed. “Supplies are usually the second largest cost after labor in the hospital, and yet CEOs knew very little about it,” he says.
“Larry and I started to see strategic aspects to supply chain management,” he continues. “Given my background in sociology and healthcare management, I found that really interesting.” (Smeltzer died in 2004 at the age of 57.) One of those aspects – and one Schneller continues to study today – is the role of physicians in healthcare procurement. Another is the role of group purchasing organizations in the healthcare supply chain.
Today ASU’s supply chain management program maintains strong ties to industry, including companies such as John Deere, says Schneller. The university is also a partner in the Center for Advanced Purchasing Studies (CAPS Research), which Schneller describes as a marriage of academia and industry working to solve supply-chain-related problems, some of them healthcare-specific.
Supply Chain Initiative
Ten years ago, Stonehill College in Easton, Massachusetts, launched the Healthcare Supply Chain Management Initiative. It did so with the help of a $30,000 grant from Kimberly-Clark Corp., as well as the efforts of alumnus Bob Simpson, DeRoyal and AHRMM. (Simpson retired last year as president and CEO of LeeSar, a Fort Myers, Florida-based healthcare supply chain company.) The Initiative is led by Mitchell Glavin, Ph.D., Stonehill’s Associate Professor of Healthcare Administration and Chair of the Healthcare Administration Department.
“Supply chain management wasn’t my background,” says Glavin. “But I had done work in somewhat related areas, such as performance evaluation and benchmarking, so I volunteered to head up the Initiative.” For 16 months he researched the field, familiarizing himself with pertinent literature and organizations, including AHRMM. He devised an undergraduate course in healthcare supply chain management – one he continues to teach today while incorporating active supply chain management professionals as guest speakers.
The Initiative sets up summer internship programs for students in medical products manufacturers and distributors, including LeeSar. Providers ramping up their internal supply chain capabilities have also been a source of internships. The Initiative over time has developed a strong link with the New England Society for Healthcare Materials Management. Halyard Health and MedAssets (now Vizient) have also provided financial support.
“We have also tried to ‘bake’ supply chain concerns and challenges into the healthcare administration curriculum, so those students are exposed to supply chain as a critical competency and potential career path,” he adds. He estimates that Stonehill already has produced eight to 10 graduates who are working as healthcare supply chain professionals.
A career choice
“Over the past 10 to 20 years, APICS has seen the supply chain function greatly evolve and grow in importance across the enterprise,” says Eshkenazi. “It has emerged as a revenue driver and competitive differentiator for corporations.
“While supply chain managers used to primarily operate in the back room, driving cost and efficiency, they are now filling executive roles, meeting aggressive performance goals and leading business strategy. Holding on to technical and subject matter expertise is still essential for supply chain managers, but we’re seeing that those who develop more advanced management skills and adopt an enterprise-wide mindset are rising in businesses.
“As this evolution has progressed, supply chain professionals have become more consumer-focused, having to consider not only the demands of supply chain partners – suppliers and customers – but also the end consumer.”
Healthcare supply chain management is evolving as well.
Supply chain students see opportunity in healthcare, says Schneller. “My first job was at Montefiore Hospital. Then, supply chain was in the basement. But in many healthcare systems today, it’s part of the executive suite. So you increasingly find hospitals and IDNs looking for vice presidents of supply chain. And those jobs tend to pay fairly well.”
Says Kowalski, “Since some IDNs are now as large – revenue-wise – as Fortune 500 companies, the compensation for supply chain leaders in healthcare and other industries is likely to be comparable. There are good career opportunities because of expected significant turnover in the leadership ranks, as established in the most recent survey.”
With more salary, of course, comes more responsibility.
“It takes a professional with strong leadership skills as well as technical supply chain skills to achieve the highest performance,” says Kowalski. “There is still a certain portion of the population in healthcare organizations that doesn’t get what supply chain is all about, or what their role is related to supply chain management. They will need somebody to educate them, persuade them – somebody with the people skills to lead them.
“The industry is just begging for this.”
Credentialed
How many healthcare supply chain executives do you know who actually have a degree – undergrad or grad – in supply chain management? Probably not many.
But meet Jim Szilagy, chief supply chain officer at UPMC in Pittsburgh, Pennsylvania. He received a bachelor’s degree in procurement/materials management from Arizona State University in 1985.
“While in my sophomore year at ASU, I read an article featuring a new program within the W.P. Carey School of Business,” he recalls. “The article described how procurement and materials management was a growing field, and only two other schools in the country offered this program to prepare students for this emerging profession. I immediately became intrigued by the abundance of opportunities that would be awaiting graduates with this exclusive degree, and changed my field of study from accounting.”
He started his supply chain career with a power tool company, then consumer electronics, and then joined Alcoa Inc. before landing in healthcare at UPMC 12 years ago.
“I have witnessed tremendous advancements in the healthcare supply chain since I joined UPMC,” he says. “This is in part due to the level of talent that has been infused from other industries, but also largely from the professional growth driven by new talent entering the workforce with supply chain degrees.
“Several years ago, [UPMC] created a very robust and competitive summer intern program, where we recruit students from schools with strong undergraduate and graduate supply chain programs. We literally have hundreds of applicants and select around a dozen highly qualified students to manage a variety of supply chain projects throughout the summer.
“We find this program to be tremendously valuable. It is critical for our sustained success to continue to nourish the organization with fresh talent at the entry level and to mentor and advance these professionals to increasingly higher levels of responsibility.”
Guess who’s coming to class?
Check out the person sitting next to you in your supply chain management class. Is a stethoscope hanging from his or her neck?
“Clinicians love supply chain,” says Christopher O’Connor, president, Acurity and Nexera, who also teaches undergraduate and graduate courses in healthcare and supply chain management. “They’ve always touched it, but never worked with it as ‘boots on the ground.’” Healthcare’s current emphasis on the connection between cost, quality and outcomes (or CQO) resonates with them, he adds.