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The supermarket technology set to save the NHS billions

The involvement of the private sector in the NHS can be a highly contentious subject – particularly in the heat of a general election campaign. But private sector technology experience from perhaps-unexpected sources such as the supermarket sector could have a hugely beneficial effect in reducing waste.

Lord Carter’s recent keynote report on unwarranted variations in productivity and performance in the NHS looked closely at the £55.6 billion spent each year by acute NHS Trusts, and at the urgent need to resource more efficiently to improve the quality of care.

One particular area of focus is procurement. By radically and rapidly modernising procurement using technology solutions, it is estimated that the NHS could save approximately £5 billion over five years that is otherwise lost through waste resulting from each Trust operating separately in their own supply chain ecosystem.

However, NHS Trusts historically operate independently. They have not tended to look to technology businesses with existing solutions that have been tried and tested in the commercial arena, such as the retail sector, which can be readily adopted for procurement purposes in the healthcare sector.

For the likes of Tesco to adopt localised procurement systems and protocols across the country would be unthinkable – corporate negligence of the highest order. However, we tolerate such variations in our NHS, with all the consequences for taxpayers’ money and front-line budgets. The need is for Trusts to adopt tried and tested modern technology solutions, so that there is harmonisation across large groups of Trusts that will enable them to leverage the advantage of harmonised supply chain data and drive the savings and efficiencies identified as being essential for improving service delivery.

Things are changing, though. A recent examples of best practice can be seen at Guy’s & St Thomas’ NHS Foundation Trust, a member of the Shelford Group of leading NHS academic healthcare centres. This group of ten leading Trusts, together accounting for 10% of the entire NHS England budget, have adopted the digital procurement platform provided by Virtualstock Ltd. The technology has been developed, tried and tested in the retail procurement arena for large scale volume procurement by the likes of Tesco, John Lewis and numerous other large scale commercial operations. Learning from the experience of highly streamlined and costs driven procurement environments gives the group of Trusts a digital procurement solution that enables it to structure its supplier universe in a coherent manner.

More to the point, when considering the often black and white debates about private sector efficiencies or profiteering, depending on your political viewpoint, by turning to an existing, retail standard, commercial solution, the Trust has been able to adopt the technology at no cost. In this example, the suppliers fund their participation in the structured digital marketplace, recognising the value that this technology brings in modernising their own business operating models. The same technology is now being deployed across many others NHS trusts.

This is counter intuitive to those who assume – perhaps understandably given the cost and contract issues that have bedevilled many public sector procurement and tech projects – that the use of commercially available technology solutions by public healthcare providers will invariably be complex to deploy and incur great costs for the NHS, with the commercial sector being the net beneficiary of any such technology project.

Advanced technology platforms are also being deployed by the NHS and their outsourced solutions providers in the staffing arena. The NHS spends £33.9 billion each year on staffing so there is significant scope for technology to delivery very significant savings.

I’ve been working with and advising a large US healthcare technology solutions provider now making its vendor management digital platform available for use by the NHS and the wider healthcare sector in the UK.

Through both NHS Trusts and private health businesses adopting similar technology platforms, a wider visibility of resources and staffing opportunities becomes available, providing a cohesive view of resources available and enabling a joined up approach to delivering efficiency and savings. The potential for more joined up planning of current and future staffing and skills requirements is clear, as is the opportunity for reduced inefficiencies and increased savings.

The challenge is to move away from individual Trusts using either their own bespoke systems or systems that are built at great expense and do not render the savings and efficiencies anticipated.

The harmonised adoption of proven, existing commercial platforms adapted for the healthcare sector is already underway. These tried and tested technology solutions can be made available on a subscription basis without the need for capital expenditure and with nominal initial configuration costs. By allowing groups of Trusts to share common suppliers, the technology can be introduced at very little or no cost to the NHS, while delivering significant efficiencies. Adopting this approach is set to improve procurement practice and dramatically reduce waste, with savings able to be directed to where they are really needed – the frontline services we rely on when we need the NHS.

Lawyer Mark Blunden manages Boyes Turner’s commercial and technology group