CLIENT:
Large South-East Hospital
OBJECTIVE:
To develop an analysis methodology and reporting framework focused on procurement expense for a large hospital so they could better manage a large and growing expense category.
APPROACH:
An analytics methodology was developed to decompose increases in expense into volume, price, and product mix changes. A database tool was developed that automated the analysis methodology for the client, including data capture and formatting, so that the analysis could be updated and the results reported on a monthly basis. The tool also reconciled the supplies expense to the client’s general ledger.
RESULT:
The analysis methodology enabled the client to understand the drivers of procurement expense and decompose cost changes into the source components.