Artificial intelligence (AI) is the use of computer programming to imitate human behavior by analyzing data to create technology systems that have the ability to understand, think and learn. In the hospital procurement process, artificial intelligence can help combat some of the largest challenges faced by health system supply chains.

How can AI help in healthcare procurement?

By integrating the use of AI in procurement, healthcare purchasing teams can drive greater cost savings, lower operational costs and drive strategic sourcing with preferred suppliers. AI in sourcing and procurement can optimize processes so hospitals can focus on having the optimal patient care in their healthcare setting.

How does DSSI use artificial intelligence technology?

A few years ago, DSSI began its journey from automation to optimization, striving to help healthcare procurement experts utilize technology in a way that humans can’t do. And now we’re taking that a step further with AI programming and development. DSSI uses artificial intelligence in procurement and supply chain management to help healthcare organizations by:

1: Boosting efficiency with hospital procurement software

One way in which DSSI leverages AI to boost efficiency is through its swap-and-save algorithm, which analyzes product swaps that have been made by healthcare customers in the past to predict which product they should switch to.

Andrew Novotny

Vice President,
Product Development and Engineering

“If you look at humans, they couldn’t efficiently process all that data to choose from a high volume of products that are available across multiple distribution centers in the United States, along with the fact that some of those products go in and out of availability,” says Andrew Novotny, Vice President of Product Development and Engineering for DSSI. “It’s an arduous problem for a human to solve. The only way we as a society are going to solve that problem is to look at technology – specifically the use of artificial intelligence and the processing power of computers – to be able to make those changes in an optimized way that wouldn’t be cost-effective for a human to do.”

When it comes to healthcare food procurement, there’s constant volatility with products. DSSI uses procurement technology to ensure supply continuity. DSSI’s real-time, AI-developed order guide management (OGM) tool allows for greater efficiencies by grouping items and giving you the best available price based on your closest food supplier. OGM AI is focused on cost savings by directly integrating with supplier stock prices to replace unavailable products with the best available option. You can truly swap-and-save with DSSI’s healthcare food procurement!

2: Driving cost savings with machine learning in procurement

DSSI’s AI engine examines customers’ ordering behaviors with machine learning technology to identify recommended products for healthcare based on their individualized ordering algorithm. The system learns user tendencies to make itself smarter, which Novotny believes is in the spirit of AI.

“We’re looking for optimizations where we can make it easier for end users to do what they need and get back to their jobs faster and more efficiently,” Novotny says.

DSSI’s machine learning in procurement constantly learns from users’ purchasing behaviors. DSSI’s AI system’s machine learning works to understand what works best for hospitals and healthcare organizations to deliver personalized procurement savings for every hospital system’s supply chain.

3: Using AI in spend analytics and procurement cost savings

From a DSSI perspective, Novotny says the two top priorities are enhancing efficiency and helping customers pinpoint savings opportunities. DSSI is using AI and algorithms to aid in rebate processing, a complex relationship between manufacturers, purchasing organizations and distributors. Optimized rebate processing can aid in greater procurement contract compliance.

Novotny says depending on volumes and contract lengths, it may be better for healthcare customers to swap from Product A to Product B because Product B is actually a lower total cost. Even though the initial price might be higher, the rebates based on volume end up making it lower. He says when healthcare procurement experts evaluate these types of purchasing decisions holistically, AI can look at all the variable factors that may even change on a daily basis to help determine a lower overall price point.

It’s hard to understand procurement cost savings if you can’t visualize them. DSSI’s comprehensive data visualization tools allow hospitals and healthcare organizations to actively see their procurement patterns and sourcing processes. Their spend analytics can help connect cost, spend and purchasing for optimal procurement and hospital supply chain management. Learn more about DSSI Analyze’s spend management software.

“Our tagline is always ‘Taking Cost out of Healthcare,’” Novotny says. “How can we find unique, novel ways to remove cost for our end users? AI is just one of our tools to do that.”

The future of the healthcare procurement process

Still in the early stages of the journey, Novotny anticipates there will be many future AI-related additions to help DSSI add even more innovation value in every aspect of the healthcare procurement process and help customers make more streamlined purchasing decisions. Procurement teams and AI researchers are constantly developing procurement software so the future of AI in healthcare procurement is continually evolving. 

Integrating AI into your healthcare procurement process can enhance your supplier relationships, operations, decision-making and data acquisition. DSSI’s artificial intelligence technology can solve your largest healthcare procurement challenges

Contact us today to learn more or for a free demo!