Financial Impacts of Strategic Automation

Take a centralized approach to automation for substantial business benefits.

CBORD’s recent customer research clearly shows that automation is key to overcoming current market pressures for healthcare food and nutrition operations.

But there is an important distinction to make. Automation for the sake of automation is not the answer. Using disparate systems across your health system will only serve to compound operational inefficiencies and weaken performance.

On the other hand, automation approached strategically at the enterprise level can have far-reaching and fiscally important impacts.

Take centralized procurement for example. It drives volume purchasing of the same products across the health system for better purchasing power, maximized incentives, and improved GPO compliance.

So, rather than having each location handle menu planning and purchasing individually, manage these functions centrally for a surprisingly significant impact on costs and revenue.

The Power of Centralization

What impact can centralization actually have on the bottom line? Consider this real-world example showing the monetary impact of centralizing food and nutrition services at a 15-hospital health system.

The first-year net savings were approximately $1.5 million. The five-year impacts:

  • Revenue increased $1.5 million (14%)
  • Rebates increased 53%
  • Operating cost decreased $1.7 million
  • Cost net of cash decreased $8.62 per patient day
  • Food cost savings of more than $1 million year over year

This health system started with site-based operations, isolated reporting, and no system-wide standards. To meet strategic health system initiatives, the food and nutrition services organization implemented a plan to centralize operations and was able to achieve their results by:

  • Leveraging automation by moving to a standardized technology platform
  • Aggregating volume for better pricing
  • Standardizing recipes for patient and retail menus
  • Evaluating system-wide pricing in retail to enhance revenue
  • Standardizing policies, procedures, and best practices

 

Infographic showing financial benefits after 5 years

Benefits Beyond the Financial

Looking past the tangible cost and revenue benefits, centralization offers other advantages that are difficult to quantify, yet are crucial to the overall success of the health system.

A centralized approach gives you the agility you need without sacrificing efficiency or accuracy.

The current supply chain challenges are a prime example. According to CBORD’s research, 80% of healthcare professionals surveyed say they deal with supply chain problems on a regular basis1. Without the right system, substituting ingredients on-the-fly can have serious consequences for patient safety and the bottom line.

With centralized procurement, the system helps you anticipate and manage the cost impact of substitutions. Built-in compliance connects with allergen information directly from the manufacturer, so you can ensure patient safety and mitigate risk regardless of the changes taking place.

Of course, this is only one example of how a strategic, centralized approach to automation can transform operations. With an enterprise platform, improvements can be achieved across your food and nutrition organization.

To learn more about the advantages of centralizing healthcare food and nutrition operations, read our e-book and watch our on-demand webinar.

Find out how CBORD can help you design a seamless, connected health system experience. Complete a brief form and let’s talk!

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1 CBORD Insights proprietary research, Customer Priorities Survey, September 2022, n=276. 

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How We Help Throughout Your Healthcare Campus

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Foodservice

Operate a lean, agile foodservice program with an integrated, leading-edge technology solution. Use smart tools for everything from menu and recipe planning to nutrition analysis, food production, inventory management, and more.

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Patient Nutrition

Manage the complexities of safely feeding patients with smart tools and leading-edge technology. Provide a personalized meal ordering experience that ensures compliance and patient safety for every meal you serve, every time.

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Retail & Point of Sale

Streamline and modernize your POS processes with the latest in hardware and software. Offer online ordering and payment options that support social distancing in all your food service, gift shop, and convenience store locations.