Tim Nedley
Tim Nedley
- Vice President, Materials Management, UPMC
- UPMC consists of 5,100 licensed beds; $2 billion in annual supply chain management spend; $12 billion in annual revenue.
Tim Nedley joined UPMC in 2008 as an assistant director of distribution. A series of promotions – from director of materials management to senior director – saw him to his current position in 2015. Today, he is responsible for two distribution centers, which supply UPMC’s 22 hospitals with med/surg supplies, specialty equipment and moving and storage services. In addition, he oversees over 400 UMPC employees across materials management, logistics, transportation and freight, as well as the organization’s 450 fleet vehicles.
The Journal of Healthcare Contracting: What has been the most challenging and rewarding project you have been involved in recently?
Tim Nedley: A challenging and rewarding project has been our inbound freight reduction project. Freight and handling expenses are not easily identified, but – together with a tenured group of professionals – we have been able to pull it all together into comprehensive and actionable reports. Along with our freight team, Bart Wyss (retired from UPS) and Frank Bertucci (a 22-year veteran of FedEx), we’ve uncovered an industry trend, where vendors are grossly profiting from freight charged to their customers. At UPMC, we’ve taken a very stern approach, and [permit our vendors to] only charge us what it actually costs to ship the product. In some cases, we’ve exposed huge amounts of freight abuse; in others, we’ve partnered with vendors to reduce shipping and processing costs on both sides, creating a win/win proposition. True freight management is more than just the pricing of the shipments. It includes mode management, dimensional weight and using a sensible approach to getting our products when we need them. This approach has saved UPMC $1.9 million in freight costs over the past 14 months.
JHC: Please describe a project you look forward to implementing in the next year or two.
Nedley: We are working on a major velocity slotting project to further increase our picking productivity and quality. By grouping items together for like departments, we will reduce the number of steps required to complete an order. This will lessen the fatigue on the staff and increase the number of lines they are able to pick in a shift.
JHC: What are the most important qualities you look for in a supplier partner?
Nedley: Of course, we look for a great product. In addition to that, honesty, business ethics and open-mindedness are important to help us meet our needs.
JHC: What is the greatest change we can expect to see in healthcare contracting in the next five years?
Nedley: The continued consolidation of hospitals and IDNs into mega-IDNs will increase the centralization of supply chain contracting and services. This will create further opportunities for savings in support staff, volume discounts, standardization, freight and real estate costs. By consolidating these services, space should be freed up for revenue generation at the individual hospitals. Additionally, effective supply chain organizations will likely find themselves being asked to get more deeply involved in areas beyond their current focus.