After modernizing the finance and supply chain, SSM Health is set to achieve positive ROI in less than two years. Learn tips and best practices from the IT team VP for driving disruptive change that delivers value-based business impact.
SSM Health has a storied, colorful history. Started in 1872 by five Catholic sisters, the not-for-profit health system has expanded to 23 hospitals serving the comprehensive health needs of communities, especially the underprivileged and vulnerable, across the Midwest. The organization employs 40,000 professionals and supports 11,000 clinicians —all committed to delivering exceptional health care services.
When the first COVID patients entered SSM Health’s doors, memories of the historic institution’s experience during the smallpox pandemic resurfaced. In decades past, people exposed to smallpox rang a bell to alert people that they had the disease. The staff transformed that memory into a positive experience during COVID, playing “Here Comes the Sun” when COVID survivors were discharged. This practice both inspired and motivated healthcare staff and patients.
It’s difficult to imagine that during the global pandemic, SSM Health had a finance and supply chain modernization program underway. Even with the challenges that COVID raised, the project’s team managed to stick to its timeline of launching in November 2021. Led by Ernst & Young, Intel, and SAP, SSM Health is implementing SAP S/4HANA on Intel® architecture powered by Intel® Xeon® Scalable processors and Intel® OptaneTM Persistent Memoryto modernize its finance and supply chain and support a shift to value-based healthcare.
Edward de Vries, Vice President of IT Business Consultancy at SSM Health, names multiple reasons for the move to SAP S/4HANA. From a financial perspective, SSM Health was facing margin compression, further impacted by a revenue decrease during COVID. The complexity of managing multiple types of technology and systems was also a factor. SSM Health needed to simplify the frustrating overload of supporting 25-plus disconnected systems with siloed data that was unsustainable and expensive to maintain. Looking long-term at healthcare’s trajectory, the executive management agreed that healthcare is shifting from reimbursements based on number of procedures to reimbursements based on value of care provided. All these factors led to the decision to overhaul SSM Health’s finance and supply chain and upgrade to S/4HANA.
With the implementation underway, de Vries offers real-world guidance for other healthcare systems facing similar situations.
Insights and Tips for Modernizing Your Finance and Supply Chain
Don’t fear rapid implementation. Once you decide to lay down a new foundation and implement a greenfield system, you will realize you are no longer held back by past decisions. This lets you ride the wave of change and get to a better place. Moving onto the launch ramp quickly also compresses costs.
Be prepared to face cultural issues. Technology isn’t the hardest part when moving to new business processes. Managing cultural change is the real struggle, and it requires communicating the guiding principles to all, and breaking old habits. SSM Health, for example, had always made decisions based on consensus, which delayed implementation and limited innovation. Once the organization moved to smaller groups, SSM Health began consistently executing and delivering results that will lead to high value outcomes.
Rely on tools and resources that create success in Fortune 500 companies. The healthcare industry views itself as unique, and healthcare technology companies have played that to their advantage, creating specialized platforms. SSM Health wanted to avoid that trap and find a solution that supported the most successful organizations in multiple industries. Executive management chose to leverage the same tools that many Fortune 500 companies rely on every day so they could implement industry-independent leading practices. Invoicing, general ledgers, accounts payable, and other business processes are familiar across industries, and SSM Health wanted to benefit from broad, cross-industry expertise.
Focus on benefits, not implementation. While launching a new system is definitely an achievement, it’s not the end goal. Focus instead on what the organization can achieve now that the new system and technologies are in place. A big part of that will be creating a disciplined practice of identifying metrics of success and tracking business outcomes. If you set a goal that the new system will reduce P&L by X amount in 12 months, be accountable to track and measure the results. Dashboards with real-time visibility are critical to monitoring metrics and costs that help you understand organizational successes and problems.
Healthcare Is a Business
U.S. healthcare is on a trajectory toward value-based healthcare, putting volume-based care behind us. It’s a fundamental shift in how healthcare systems operate. Healthcare leaders like SSM Health know that legacy systems and processes don't match today's emerging value-based healthcare needs, and they are modernizing their systems to support less complexity, enable technologies like predictive analytics, automate processes, and gain visibility into each group’s successes and challenges. As de Vries says, “We have invested in the best medical and research technologies to deliver premium healthcare services, but we have a business to run too. Ernst & Young, Intel, and SAP have helped us optimize how we run our business.”
Register and watch the full webinar here. Looking for more insights and support in your healthcare transformation strategy? Join healthcare leaders and share business knowledge, best practices, and resources for enabling value-based healthcare in the Healthcare Business Transformation Consortium (HBTC). Apply now.
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