Taking The Supply Chain Pulse
St. Onge’s Healthcare Hall of Famer and industry icon, Fred Crans, chats with leaders from all areas of healthcare to discuss the issues of today's- threats, challenges and emerging trends and technologies in a lighthearted and engaging manner.
ENGINEERING A BETTER HEALTHCARE SYSTEM
We provide comprehensive planning and design services to develop world-class facilities and highly effective support services operations. Our capabilities in hospital supply chain consulting include applied industrial engineering, lean methodologies, systems thinking, and operations research to enable improved patient care and staff satisfaction. We are proud to have worked with over 100 hospitals, including 18 of the top 22 in the US, utilizing diverse design strategies, post-construction implementation, and change management.
Taking The Supply Chain Pulse
Kids Aren’t Small Adults, And Your Inventory Should Know It
We explore how pediatric care reshapes supply chain strategy and why curiosity, clear KPIs, and real relationships drive better outcomes. We also dig into rural pressures, shifting reimbursements, and building a talent pipeline that pairs education with experience.
• Defining high mix, low volume for children’s hospitals
• Preparing for pediatric surges and limited vendor coverage
• Reviewing reimbursement more often to protect margins
• Choosing a small set of KPIs that guide action
• Building relationships that beat transactional networking
• Rural access risks and current-state assessments
• Growing homegrown talent and planning succession
• Balancing education with hands-on experience
• Mentorship, feedback, and the next generation’s path
Subscribe and connect with us online. If you have a topic you would like to discuss or want to be a guest on the show you can reach out to Fred directly at fcrans@stonge.com
This week, United Supply Chain's Hulk, Fred welcomes back a familiar voice and trusted friend, Fred Petty. Fred is a seasoned healthcare supply chain leader with deep expertise and consulting experience, particularly in children's hospitals. And this episode features practical insights and actionable strategies to help professionals thrive in today's rapidly evolving healthcare landscape. Grab your pen and paper because you won't want to miss these takeaways. And now future host, Fred Kranz.
SPEAKER_01:My friend Brent Petty is back to talk to us about his recent experiences as a consultant in children's hospital healthcare, some of his historical background at uh his previous uh places of employment, what he thinks about rural and uh underserved areas of healthcare in the country, and whatever other issues may come up. Brent, thanks for uh joining us.
SPEAKER_02:Hey, Fred, good morning. Uh thank you. It's always a pleasure to be with you. It's always a pleasure to have you on, brother.
SPEAKER_01:I know um you recently have had a foray into uh individual consulting and interim leadership in uh in supply chain again, and you've been working in children's hospitals. And I know that prior to in prior uh employment, you were in a I what I would call a traditional healthcare IDN in Welmont uh that didn't focus on children's issues. And I I just wondered if you could give us an overview of of some of the concerns or some of the challenges that children's hospitals have that are maybe different from uh the your previous hospitals.
SPEAKER_02:Uh yeah, it's a great, great subject. And um uh I think children's hospitals are not as well known from a supply chain challenge standpoint than what we you and I would call our traditional acute care hospital. So let me throw this out here. One thing, there's a couple terms I learned uh working in a in a children's facility is high mix, low volume. And I had not heard that before from a supply chain standpoint. So um, being the curio curious person I am, I looked over and I was like, I don't understand what do you mean high mix, low volume? And it's very simple, it's a lot of different items, but not as many of each. And I was like, take me a little deeper. And they're like, it's a lot of different items. So you go from a uh a newborn neonate up to a teenager that could be the size of me and you, but still a teenager. So you've got a lot of different items to serve a same disease set or a trauma or something like that, but you don't need as many of each one. So that that was a new term to me, and I thought a great way to start this. You know, I learned there are pediatric-specific SKUs. Children are not small adults. I did I learned that. Um they have to prepare a little bit quicker uh for seasonal uh such as trauma or or uh respiratory infections or flus or those type things. They have to prepare a little sooner because there is less available supplies in this uh children's hospital environment. So those are some of the things right off the bat that I learned working in uh in the in a true children's hospital environment.
SPEAKER_01:You know what's interesting about that, Brent, and what I what I've always liked about you, uh, and I've learned to do the same thing. When I when I came from healthcare supply chain into working with St. Ones where I'm working with folks that uh you know work in real supply chains, there were a whole bunch of terms that I had no clue what they meant. And what I always try to do is I'll write them down, and if I can figure them out, I'm okay. But after I've written them down, I will go look them up, right? Uh and you had the um wherewithal to say, hey, I don't understand what this high mix low volume is. Could you explain it to me? And I think if uh if you were to give advice to a new guy, if I just came into supply chain, what would you give to advice about uh someone about uh all the abbreviations and acronyms that people are going to hear? Uh that I have no clue what they mean.
SPEAKER_02:Yeah, and you know, I don't care if you're you're two weeks into the the supply chain career or two decades, you need to ask, you need to be curious and ask for clarification. And I encourage everybody to one uh continue your education. It can be formal or it cannot be formal. It can be college, it can be a certification, it can be a certificate, but do constant learning, and these terms are a great great way to do that constant learning. I've never had a term, an abbreviation, or an acronym in healthcare that didn't lead to a good understanding of helping the patient care environment. Uh it really works that way.
SPEAKER_01:Yeah, a lot a big part of that is getting over your own ego because a lot of us a lot of us think we're supposed to know everything, and there's no way you can. Everybody speaks, everybody speaks in their own jargon. You know, the anesthesiologists speak in the anesthesiology jargon, the cardiologist. We don't know what half we're not supposed to know what those terms are unless we ask. Right. But we can't do our job unless we know what they mean.
SPEAKER_02:You know, but you know, healthcare people by by nature, by heart, by training, they're helpful people. Just ask. Go be curious and say, hey, show me what you're doing, show me what this means. Explain what you know, high mix, low volume means. I mean, I've been doing this for 30 years. I've never heard the term. Yep. And yeah, and it was simple enough and very accurate to summarize the situation.
SPEAKER_01:So um, as far as I guess urgency and the need to uh respond quickly for you know crazy demands as opposed to a a regular hospital system with sort of predictable uh supply needs. Is that something that uh children's hospital supply leaders face?
SPEAKER_02:Um absolutely. And it would it was it's always been tough, is what I discovered, that the the demand planning, the inventory levels, the different SKUs, um, even the manufacturers, some of them have a different call team for the children's hospital versus what I'm gonna call the adult hospitals. You see a total different set of reps. And I sort of got to understand that because when you're when you're doing an open heart surgery on a neonate or a teenager or a scoliosis surgery or a pacemaker, those are different environments for the physician and the nurses and the sales reps. So I did I did see that it does take um some different planning. And I don't, you know, I don't want to jump too deep into the uh you know the the one big beautiful bill, but some of the uh reimbursement changes that have been pushed down to the states where these children's hospital operates, they got to be a little more savvy in how they plan their inventories, you know, how they uh plan their capital purchases and and then manage their wages. Can they give raises and can they add to the benefits? But the one big beautiful bill has influenced that. And I'll give you just a quick example. Lots of times when we look at procedures that involve implants, we'll look at the average reimbursement, and then we may not look at that average reimbursement again for the length of that contract. The one big beautiful bill has now required us to look at those reimbursements more often, if not once a year, but at least twice a year instead of over that term of contract.
SPEAKER_01:Yeah, that that I wasn't gonna get into politics, but you can't you can't just you can't just no, you can't discuss our our job anymore without uh giving uh you know uh concern to politics. So the one thing that uh I I think is I've always admired about you is you you have a way of connecting with people and and uh you're not threatening to people. You have the sort of down home. I know it's all I know it's all an act. I know you're really smart. I you're I know you're really smart, but you don't act that smart most of the time. So that's good. Uh I I do the same thing myself. But um you were the uh chief relationship officer for Bluegrass Media, which which sponsors several uh conferences and reverse expos every year. Right. I'm the outreach ambassador for the Bellwether League, and over the years there's been one thing that's a craw under my uh skin more than anything else, and that's when I hear people talking about. You need to build a network, you need to go networking. And I tell people, and they would say, Could you talk to me about how to build a network? I said, No, I can't, because I don't do that. Yeah, I I make friends, I build relationships, and I know that that's how you I know that's how you found out about uh the um the uh high mix low volume stuff by asking, by building relationships. I know you used to uh manage probably the same way I did, which is walking around knowing everybody and everything in the in the hospital. Tell us about tell us how you feel about the value of relationships versus the transactional thing of uh of building uh of networking.
SPEAKER_02:Yeah, so so uh it's a it's a great piece of conversation, and I believe something that is being lost on the generation today that you and I have made careers on is building a relationship. Of course, when I think about networking, I think about IT and and wires hanging from the ceiling and and all that. So relationships are what successes are built on. I don't care if it's a personal relationship, a business relationship, those relationships really are the key to successes. You and I both attend several conferences per year, and we get the most value out of continuing our relationships and building new relationships. And that's how I find out things. You know, Fred, I sent out an email this morning to several people asking, you know, a CFO had asked uh a particular question, and I needed to weigh in on it. I didn't send it to a network, I sent it to relationships, and those are the people who are going to give you the stern advice, the correct advice, the advice that you need. They're the ones that you turn to during hard times, um, you know, when you've got something tough. Hey, Fred, I wouldn't ever not pick up the phone and say, hey, this is what I'm about to do. Is it the dumbest thing you've ever heard, or is it the best thing you've ever heard? Or is it somewhere in between? Never underestimate the value of a good conversation, and the only way you can have a good conversation is with a rela based on a relationship. And those take time. You and I both know that. We had to get to know each other. Um and that relationship development versus a network development is a lost art today. It really is.
SPEAKER_01:And and um, and I think it's been um something that has moved both of our careers along. And you know, you can't go anywhere without uh without running into people, and those relationships keep giving you more and more from from those things. I I think go ahead.
SPEAKER_02:Let me make you commit to a promise here in front of it in front of everybody. Let our next uh podcast topic include how a successful adventure came about between you and I having a relationship. Now that hadn't happened, the relationship hasn't led to the to the new endeavor I might take, but I want to cover that in our next podcast. Can't tell them about it today, but we'll tell them about it in the next one.
SPEAKER_00:Before we dive back in, you may be asking yourself, is my supply chain future ready? CNOC Company, we don't just optimize logistics. We engineer smarter, leaner, and more resilient systems from end to end, from manufacturing to retail to healthcare. Our experts bring decades of experience in cutting-edge strategies to transform your operations. Visit and discover how we're shaping the future of supply chain one solution at a time.
SPEAKER_01:Yeah, well, I I can tell them I can tell them about something that happened to me and to uh to a company I was working for when uh uh one uh one of the supply chain leaders called you and asked you uh who could handle a certain project, and out of the blue you called you called me. And I never would have had, I would never would have I don't I I think I knew the guy, but uh I didn't know him well. I never would have had any idea that project was coming. And that that's it's years over year over year, and boom, the right moment comes up, and then the friendship and the relationship kicks in and can help each other. That's what we should that's what we should be looking for, in my opinion. Um the the another thing, you live in an area, we were talking earlier, I think you said you live you live in an area where you can very quickly get to um North Carolina and Kentucky and West Virginia. Uh so you live in Appalachia, really.
SPEAKER_02:Yes.
SPEAKER_01:And when we get back into that um big beautiful bill, you live in one of the areas that is going to be most likely negatively impacted as far as access to health care by that bill. Uh you have in there many smaller IDNs trying to survive. So, what kind of challenges do those organizations, those people, and those supply chains face uh today as opposed to before that bill came along?
SPEAKER_02:Well, I first and foremost, I think the biggest challenge in in Appalachian, where I live, and other parts of the company that have country that have true rural health care, and that's what we have here. We do have small occupants and um communities that depend on them. Okay, so you lose your local hospital, you may be an hour from from any type of urgent care or emergency care, and that that could mean disability or life or death. So, with that, I think the first thing these rural health care uh systems need to do is understand their current state as solid as they can. I, you know, I don't care if it's you know their contracts, whether it's a payer mix or a supplier mix, whatever contracts you're talking about, you have to first understand where are you today? And then from there you can say, okay, where do I need to be? And then you can develop the strategy or the strategic plan in between those two points. But where I see a lot of the smaller health systems, they're trying to dig in and either get a better payer mix, improve on the current payer mix, or better supply contracts to reduce the overall cost or planning to reduce those costs in some way, but they don't have a solid platform of where am I today? What am I spending my money on? You know, what did I do last year and did I meet my goals? And I know that sounds simple, but that's what I'm finding out in rural health care.
SPEAKER_01:Yeah, and and uh you get back to uh uh just the cost and the impact of uh of having revenues taken away. It's gotta be gotta be terribly scary for those folks. And right.
SPEAKER_02:And you know, when people reach out to me in rural health care, which I grew up in, I grew up uh working in rural hospitals, I grew up working at community health systems, which at the time had all rural health hospitals, and they look at me and they say, you know, what should we do first? And I was like, first, let's set up some KPIs. And these key performance metrics, your benchmark, your scorecard, whatever you want to call them. I said, you know, you can't change anything if you don't understand where you are today. And I tell these people, don't come out here with 10 or 12 KPIs. I mean, you're just, you know, back to the relationship thing. You want to ruin a good relationship, yeah. Confuse somebody. And that's what you're gonna do with too many KPIs. You can certainly build up to that, but I encourage you to pick two or three that you can really set a baseline, understand where you were this year and last year, and where you need to be successful next year. And one of those things is uh your Medicare and Medicaid, the CMS reimbursements. You know, are you making, and I'm not gonna say, I'm gonna let me rephrase it, are you breaking even on those patients?
unknown:Right.
SPEAKER_02:And do you know that from a supply chain standpoint?
SPEAKER_01:You know, that's interesting because I used to try to build uh uh KPIs into uh clinical areas, and what I would always do is go to the director and say, look, we want to measure your performance, but you pick the key metric that you want to measure that we can measure, and we'll use that metric. And we're not gonna measure you against the rest of the country, we're gonna measure you against you so we can see how we're improving. When we when we make a change, we can see the impact of that change. And by doing that, by by giving them the uh opportunity to pick what they wanted to measure, and then by not measuring them against the whole country, which I've seen, I've seen that's a that's a way to just kill your credibility with uh with uh your the folks you work with when you measure yourself against the Cleveland Clinic, because it ain't gonna work, okay? I agree. And and and that that worked out well, but you get to another point about the rural IDNs and stuff, is how do they attract the talent they need to survive? Because uh, you know, nobody wants to live uh in in many of those areas. How do they how do they find the the uh the quality of uh supply chain leaders that they need to uh to go forward successfully?
SPEAKER_02:You know, that's that's a tough question, and I'd love to hear some of our our talent uh acquisition experts, you know, weigh in on that. But from my perspective, you've got to recruit the homegrown talent. You've got to look around and see who is locally, and when I say locally, you know, within a hundred miles, you know, it doesn't have to be down the street because we're small communities, but we are all connected. So you gotta look for, you know, same thing with the uh the local colleges recruiting their football guys, and then they're looking at the local talent. You have to look at the local talent, and Fred, unfortunately, I'm won't say outside of healthcare industry, you know, because we do have some. big industry our coal mines uh you know it's it's a big industry uh some very expensive uh supplies and equipment needs there so we can we can borrow from other industries but we're gonna have to grow our own talent and look at our own talent yeah and that's a that's a very good point i uh I'm talking to Ed Hiscock uh from Trinity and uh he just retired and someone from Trinity got the position to replace him.
SPEAKER_01:And what's always bothered me is that we'll bring we will bring in some hotshot from the outside to to take the supply chain leader position and then the whole place will be um messed up as we convert to that person's uh leadership style and stuff for four or five years and we'll have people that have worked there forever that there's no career ladder and there's no hope of having an opportunity to uh to actually win the the the position of leadership and and I think that's wrong. I think that uh one of the things that a supply chain leader should be doing is uh assessing his or her talent and developing them so that there's an opportunity for them to uh you know uh grab the uh the key role when that person retires or moves on I couldn't agree more friend you know because section planning is sort of lost in the healthcare industry right now there's a lot of uh folks who are aging out and then there's not a plan to replace them internally and it's very expensive and often not as successful as you would like.
SPEAKER_02:Yep I know I know that uh back in 1983 when I left Miami to go to Canton Ohio um I was fortunate there the guy that was running the supply chain was a Latvian guy named Leonard Poodles P-U-D-U-L-S and he hired me as the associate director of materials and I worked as the associate director for a year before he retired so that by the time he finally retired I was I was ready I knew people you know it's way different than uh than the way we uh do things today perhaps you know you bet what what do you think about the talent pool today you know uh it's strong it's just real thin uh the ones that are available and eligible um I think are going to make good leaders one of the biggest things I see today is not putting the time in um put your time in before before you become the director or the associate director or the VP or whatever the tip of the spear may be in that health system I see a lot of talent that is raw and has very good potential but they want to be the boss today. They don't want to put their time in. You know and I get it you've invested in your education so now take the same resources and invest in your experience. I don't think uh education is a substitute for experience at all I encourage you to get your education but I also encourage you to get the experience and take the time to get the experience and you know how much time did you spend in the hallway talking to the director whether it's the nursing or respiratory or or the medical director of a service line take put your time in get your experience and then you'll become a much better leader but it there it is very thin in numbers.
SPEAKER_01:We are fighting but I know that from uh from a technical standpoint or from an educational standpoint uh the folks that are that are coming uh into the business today are way ahead of where we were I started out as a nursing assistant after I got out of the military so I went from nurses aide to supply chain leader but by the time I had uh one day of management experience I'd had seven years of uh of uh uh doing the work knowing how it gets done the these guys don't have that they come out with uh with the uh degree and then they have to learn what goes on uh they have they know a lot of buzzwords and they're very bright very very bright people yes I mean the uh I've met so many of them so many of the young folks really are gonna have great careers and I I think part of our job is those of us that are the older folks that are still uh in the industry through places like Aram and through the various conferences is to sort of become sort of soft mentors for these people to folks that they can relate to to help them learn. And you've done you've done a good job about that. I mean I I I watch the way uh you interact with people and and um you know it's it's something it's a responsibility we all have I think you bet.
SPEAKER_02:So what what else do you want to talk about that I haven't asked today buddy well you know uh we just completed uh from I'm gonna call it the April to August uh conference tour yeah and what you know we're seeing a little different um uh uh uh attendance let me put it that way and you know I've I've worked with the different conferences you know and and I've I see you at at many of them I see a lot of uh relationships that I've built at these but I'm real concerned about the younger generation is that how they want to build their relationships or gain additional learning is coming to these conferences and I'm I'm thinking probably not um I think they they want to develop a different way and I think we may lose the relationship development that you and I already talked about but also um the additional education learning from your peers I mean it's the best learning you you've discussed it already I think this younger generation is not conference goers and that's one thing that uh we've got to replace so it'd be interesting to see how we approach that.
SPEAKER_01:Yeah I I I uh I never uh looked at it that way but I think you're probably right um it is going to be interesting there are a lot of bright folks out there I mean I do uh a lot of work with the Bellwether League so I've I do uh I do know a lot of the future famers and uh the ones that the best of the young folks are doing the right things or they're going to be doing the right things if you know what I mean but the the other folks need to learn and I don't know I don't know if the mentors are around that we had. Right I I was fortunate enough to have had people uh bring me into the room and close the door and tell me what I was doing wrong and what I needed to do better. And and I don't know I don't even know if today's today's management world people have the courage to do that without having to worry about the possible consequences of the person that you're talking to going to someone saying that you were uh doing terrible things to them. So it's it's harder to do it now than it was then.
SPEAKER_02:Yeah see I had a couple of great mentors that allowed me to fail and fail miserably and then bail me out. They let me get in the ditch and then they got me out of the ditch. And and that's invaluable Fred yeah but um you know I congratulate like the Bellweather league and the future famers ARM's got the uh YPAC the young professionals but I'm worried is it enough I mean the talent that those two groups have are very notable talents but it's not enough to replace in my opinion today the old gray haired folks leaving.
SPEAKER_01:Yeah yeah it we'll see and and I think things are only going to get more difficult as time goes by you know I mean I I think of that whole uh rural rural health care and I go back to Vietnam with me and if you were a soldier getting shot in a jungle in Vietnam you got better and quicker care than if you're some uh if you're a woman going into labor uh a terrible labor somewhere in the middle of Montana where there are no hospitals around today 100% same way we're out with your husband's got to get in the car and hope that he can get you 200 miles to a place of treatment in time uh in time to save your life and the babies where we had that guy in a helicopter that guy was the next best place in 20 minutes the next best place after that an hour later and maybe back in the continental United States tomorrow. Yeah uh that that's way way different than what we're looking at now so so times are uh times are challenging out there I know that uh one of these days we're gonna see Brent Petty back in the uh in the regular flow of things because in my opinion uh your best place is doing the job of running the supply chain somewhere and I'd like to see that happen again.
SPEAKER_02:Well Fred I appreciate the kind words and always the opportunity to to share I don't I think that's one thing that we've got to keep doing is is sharing our experiences and our knowledge is and just stay in front of the people and and bring them along.
SPEAKER_01:Yep well hey dude uh it's been great having you on the podcast and we'll have you back again sometime to talk about uh talk about that one thing you wanted to talk about that we didn't talk about today I'm gonna hold you to it friend okay brother have a good one all right thanks take care well that's all for today thanks again for joining and as always don't forget to subscribe and connect with us online where you can find all of our episodes if you have a topic you would like to discuss or want to be a guest on the show you can reach out to Fred directly at F C R A N S at S T O N G E dot com.
SPEAKER_00:See you next time
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