Cleaning Up the Mess, Connecting the Pieces: The Value of an Integrated ERP System

January 11, 2017

Healthcare supply chain decision-makers often have to cobble data together from multiple people, locations and systems just to answer basic questions.

  • How much am I spending in this category, facility or department?
  • What’s my market share in this category?
  • Where are there rogue purchases outside my contracted or preferred vendors?
  • Who is purchasing non-preferred supplies?
  • How do different supplies impact my quality metrics – length of stay, complications, infections, mortality, etc.?

Information is rarely formatted, standardized or integrated across the different systems and technologies. Point-of-use supply data is not always collected accurately or maintained in EHR systems.

We continue to ask clinicians to manage supply data collection tasks without understanding why. So it’s not unusual for a circulating OR nurse to enter “implant plate” in the OR system with half the item number or MMIS number missing. Failed processes create tons of extra work. Data inaccuracies equal poor decisions.

Multiple stand-alone systems are common

Multiple technologies don’t help. Many are inherited in mergers or acquisitions. It’s not uncommon for an IDN to have several MMIS systems, EHRs and operational systems. Pulling basic information for a simple value analysis or contracting project is tough.

Systems are rarely integrated. Analysts must pull transactions into Excel, match data, clean up descriptions and item numbers, and delete incorrect rows – all by hand – just to make data presentable. The process consumes valuable time from a shrinking supply chain staff. Heaven help you if you need internal IT support. It might take weeks just to get in a queue for even a simplest request.

Once this process is done, an analyst then must update each system with new pricing, items and charge codes. Typically a multi-step processes for EACH system. More time wasted on transactional drudgery. Is loading price changes into item masters the best use of staff time?

Automated ERP interfaces are a better option

There’s a better way to move data and standardize it into one location. An automated ERP interface.

An automated ERP interface enables machine-to-machine data routes between an ERP and other HIT systems. Unfortunately, many ERP systems don’t include interface functionality. Instead, users must use the manual interfaces described above. Or use an IT-intensive process to force a system to deliver this functionality. Neither is sustainable.

Fortunately, a savvy buyer can now evaluate a new ERP system purchase on its ability to integrate with other HIT systems. We encourage an ERP buyer to look for a system with these three qualities:

  1. Does it include integration technology? There are many formats and standards for a modern healthcare enterprise. Interfaces may need to leverage EDI, HL7, flat files formats and APIs. Data may need to flow in real time, micro-batch or batch. An ERP must include advanced, healthcare specific integration technology that is both HIPAA compliant and secure.
  2. Does it have a list of system connectors? An ERP should include a resume of healthcare specific integrations that have been implemented at previous health systems. Ensure the HIT systems in your organization are on this list including your EHR, MMIS, surgery, financial, billing and other clinical systems.
  3. Does it include out-of-the-box ERP interfaces? While some ERP systems include integration technology, using the technology to create interfaces may require too much time, training and resources. It’s far better that the ERP system you select includes pre-built interfaces not just the technology to build them. Some ERP vendors offer pre-built interfaces as a managed service that will avoid extra IT effort and accelerate ERP implementation.

Again, manual processes are not efficient ERP interfaces. MMIS and ERP systems can no longer exist as islands. In health systems today, ERP systems must integrate seamlessly as part of an ecosystem of HIT applications. As you evaluate your next ERP system purchase, integration should an important criterion in your decision. Please comment below if you need help.


Matthew Shimshock, product director, Premier, Inc.
I am a supply chain analytics expert living in Asheville, NC who educates, implements and delivers value to healthcare systems’ procurement life cycle. When I’m not working, you’ll find me spending time with my wife and 4 teenage children. I also like traveling and cheering on my kids during their many sporting events. Connect with me on LinkedIn.
Previous Article
Hive-minded Healthcare
Hive-minded Healthcare

“Collaborative” is a good word for a hive of bees, but not a compliment you usually hear describing traditi...

No More Articles


Like what you see? Get fresh content by subscribing to our blog.

Thank you! We post 1-2 times per week.
Error - something went wrong!