The Value of DSSI™
Direct Supply® Procurement Services has a deep knowledge of healthcare and senior living experience. We’ve helped our customers with inflation, managing supply chain issues, and training. When DSPS steps in to help relieve some of those pain points, there’s a difference.
With our patented AI technology and dedicated procurement services team, we transform procurement services into a strategic advantage, saving our providers at least 10% every year. Time savings are also optimized with a dedicated team helping to reduce labor costs and lessening the burden of busywork.
We sat down with two of our subject matter experts who have had long careers in senior living: Eric Selvidge, Senior Spend Management Consultant and Spencer Beard, Spend Management Consultant for DSSI™ Procurement Services. Read on for our discussion on how Procurement Services sets itself apart.
How does DSSI Procurement Services set itself apart from an internal Procurement Department?
Spencer Beard: DSPS sets itself apart because of our scale and serving over 90 operators and 4,500 communities. Whereas a single operator may be limited to only their data, DSPS has access to billions of dollars worth of data, which in turn allows us to develop programs and find opportunities that a single operator may not be able to find. Additionally, DSPS has incorporated next generation tools like OGM.AI, which mines terabytes of data, empowering our team to find the most cost-effective solutions for our customers.
As someone who previously handled procurement internally for a large organization, how can a new organization benefit from the types of services Direct Supply provides within procurement?
Eric Selvidge: When I worked with Cardon out of Indianapolis for about five years as both Director of Purchasing and Chief Procurement Officer, I knew that size and time in business impacted the procurement strategy – there wasn’t always enough hours in the day to accomplish all that we needed to accomplish. If facilities in the senior living space have a Director of Purchasing, they could be wearing numerous hats, performing scheduling duties and providing Accounts Payable services; they could be new in procurement. There is great value in understanding different needs of residents and caregivers as well as understanding how to navigate the supply chain.
There could be a lot of things going on with a new organization, and that’s where Procurement Services could step in and be an extension of the procurement team. For example, DSSI could step in and act as Director of Purchasing if a customer needed that.
Groups that have a sophisticated Purchasing department can still get value of PS through data. An internal purchasing department only has a narrow view of what their contracts and vendor relationships look like; they don’t have the breadth of data that PS has access to with the DSSI platform. We can look at procurement through a different lens compared to an internal team, so I think that’s where PS will stand out. We can step in and measure what they’re doing against best-in-class benchmarks or the industry averages, because we have access to all of that data. With that data, we can help them make strategic decisions.
I experienced that myself. Doug Pickett [Vice President, DSSI Procurement Services] and I had a relationship for the last five years. It took me several years to become comfortable with the idea [of having help]. My biggest fear was the question of, “Would this service replace me?” That was so far from the truth. I needed help and the demand my company and myself had made it impossible for me to achieve everything we needed to do. DSPS came in and allowed me to scale, which in return delivered more results and greater outcomes. I needed help to get contracts connected and other things that I didn’t have the time or horsepower for. With Cardon, that’s where I signed up for DSPS. I was losing track of price increases, discontinued items and product changes. That’s where PS was able to step in as a supplement to what I was doing.
What are some of the main benefits of the Direct Supply Procurement Services team?
SB: Tenure, knowledge diversity, geographical location, data sharing, and more! We have DSSI PS Team Members who have been with DSSI for decades. We have team members who have been in the post-acute care industry for years as nurses, CNAs, Administrators, etc. We are not all located in one state or city. This allows us to understand what is going on in different parts of the US.
Additionally, with data sharing, our customers are tapped into a knowledge base that DSPS harnesses for the benefit of the operator. As someone who has significant tenure and experience in overseeing change management, this is a valuable bonus in the service that DSPS provides.
What are some of the guidance and resources we provide to customers?
SB: We provide national and localized data to measure against industry benchmarks. We link suppliers to providers in order to provide education on products, services, best-in-industry procedures, etc. We provide a new level of visibility into their spend across their organization, providing them actionable recommendations to deliver greater results.
ES: A lot of the audience we have, specifically in my role, are executives, whether it be a CFO, a COO (sometimes even a CEO), so their mindset is on one thousand different items, and they’re trying to run an organization from whatever seat that they sit in. What these QBRs do is to give them that glimpse of what’s going on at that moment, and they can expect that on a quarterly cadence. I think that’s why the executives appreciate it so much – they don’t have the ability or time to just track emails. It can’t just be a phone call every week or a monthly check-in. They want that presentation style (especially if they’re reporting to the board), so they can take it and show the rest of the team what’s being worked on.
Explain how we Take the Cost Out of Healthcare.
SB: We reduce the cost by streamlining procedures using DSSI, identify opportunities to reduce spend by optimizing their formularies to take advantage of their supplier and manufacturer contracts, and we provide visibility of purchasing behavior across their organization through our Spend Management reporting.
ES: Driving the cost out of healthcare is really important now, especially with inflation. Food is a big part of what drives expenses up in long-term care communities and if there’s no one paying attention to that. This spend can have a huge impact on an operator’s bottom line .
Anyone in a long-term care community can have five thousand different items on their order guide for food alone. That’s not an exaggeration – it’s likely an understatement. Think about the contracts and discontinueds that are changing daily; maybe a provider has to find another item, and maybe the item that they spend the most money on – we’ll call it bacon – maybe that SKU is not available, and they have to go find another bacon product. If they choose the wrong bacon, we’re talking $100k+ that could be impacting them. If someone’s not keeping their finger on the pulse of what’s happening, that’s where cost can get really out of control.
That’s where we step in and help. We’re trying to prepare customers for 2023 budgets and get them to understand what’s about to happen with inflation. We can’t beat inflation – that’s not our job. But we can minimize the impact of inflation and better prepare our customers for the future.
How do we help providers save thousands each year?
SB: By sticking to our principles as an organization. We provide outrageous customer service by committing ourselves to quality, excellence and integrity. By doing these things, we are often seen as a team member of our customers’ organizations. When we can help our customers improve efficiencies, uncover savings opportunities, and help them scale, that all has a positive impact on their caregivers and their residents.
ES: Again, it is our focus on fully utilizing the DSSI technology to drive efficiencies, using our AI and next gen tools to optimize formularies, and identifying change management opportunities through our Spend Management data. Additionally, we can help with that tailspend on contracted or purchased services. It’s that 20% that no one’s paying attention to: telecom, technology, waste management or insurance spend or all these other things that are outside of the Procurement department and may fall within Risk or Legal departments. We’re developing programs to mitigate this, because we have the team to do it. Providers and suppliers can take advantage of these programs as a procurement customer to drive savings.
