Do you Value your Regional Supply Chain?

While working in pharmaceuticals and healthcare over the 22 years in facilities, construction, design, purchase services and capital projects I ran across so many challenges in working with national Group Purchasing Organizations (GPOs). As many of you know, national contract buying agreements provide a number of opportunities to save money through volume based purchasing. While these programs often work very well for large multi-site organizations, GPOs struggle in the areas of purchase services and other areas where labor is required for the service. National GPOs do not appreciate regional purchasing because they do not have the technology necessary to manage so many contractors/vendors so they typically focus on large national vendors only.

It can also be costly to capture the GPO products within sub tier suppliers networks without costly overhead of someone dedicated to focus on capturing the savings. With all of the best intentions, my teams at Pfizer and Catholic Health Initiatives (CHI) through the years did our best to incorporate GPO vendors in our bidding process, but were largely unsuccessful, until I re-looked at the entire supply chain process and realized that we left vendors/contractors out of the solutions.

By focusing on all participants in the process; vendors, construction managers, internal staff and the typical owner/client bidding process we were able to create M6Connect. M6Connect enables each entity to work seamlessly together with each other. Many software companies can say they do this, but few actually have achieved it. M6Connect has several free features including; M6 Drive for online storage, lean way of connecting so that you can categorize your business and colleague connections for example, vendors have their own qualifications available to share with clients/owners, vendor web page, receive and respond to RFPs and many many more.

We provide a seamless way for vendors/contractors to register with our system and share their qualification information with those they typically do work for. What makes us very unique is that once a company registers they have the choice to share their information with other companies. Whereas the typical process, vendors are required to register with all respective client systems and provide the same qualification information over and over again. Being at the bottom of the food-chain, vendors are forced to use what ever system their clients have selected. Regardless of the inherent inefficiencies with the vendor being at the bottom-of-the-totem-pole, owners/construction managers/primes continue to select one-way systems where the focus is solely on their own needs. Hence, passing the burden of learning each new system to their vendors.

The trouble with this is that if you want better pricing you need to ensure you have adequate bid coverage. So by burdening the vendors/contractors with learning new software from each prime they work with then we are creating a double-edge sword. That is to say, we want to get good pricing on bid efforts and yet we cause contractors to spend too much time and money on the bid effort and tools used. We also learned that we could easily create a regional contracting methodology to improve bid coverage by simply building the right system.

There were other problems too, such as construction managers have to coordinate their work with supply houses if they were to do the purchasing of GPO products — including warranties and other issues that vendors rely on their vendors for — upsetting the normal approach to bidding. Suppliers provide parts, equipment, wire and piping to vendors/contractors during the bid effort on projects. Bid takeoffs are done by the suppliers typically and that’s where the product knowledge lies. What does this all mean?

It means that typical GPO product widget purchasing isn’t easy to do for things that require assembly (labor), because owners/construction managers/vendors have to do a great job in coordinating the GPO products purchasing at a fair price as well as transportation and staging. Also, there are different bidding approaches (games) that vendor/contractors play to manipulate the price to win the bid. Another option that has been tried is to have the Architect or Engineer provide the materials list to buy, but even they do not know the product specifics and exactly what the suppliers are providing.

M6Connect also has over 10 products that all work collaboratively together within the B2B platform. Simply choose your products and begin working. Your company or department has a cloud based software engineered to simplify the way you do business. We provide custom software development as well to convert your paper processes to full electronic and cloud hosted.

Would you like to be a part of developing an eGPO for your region?

M6Connect provides software solutions for vendors and owners to enable them to work together seamlessly. We serve multiple industries and all customer types from vendors, to wholesalers, owners, prime contractors, construction and commercial products up and down the supply chain. We greatly appreciate all participants in the supply chain and have devised a new approach enabling all companies to work securely and seamlessly together in the same system.