Putting Process into Food Procurement with Artificial Intelligence

A Direct Supply® DSSI™ Case Study

Historically, healthcare providers have faced challenges streamlining their food procurement process. Manual product scanning, lack of data-driven insights and time-consuming optimization practices limited the ability to identify cost-saving opportunities and drive procurement efficiency.

Direct Supply® DSSI™, a cutting-edge healthcare procurement solution was designed to provide customers with a next-level procurement partnership driven by artificial intelligence and 35+ years of healthcare food procurement expertise. Let’s discuss a real Direct Supply DSSI customer experience to show the true power of the partnership between providers, Direct Supply DSSI and artificial intelligence.

Problem: Lack of Standardization in Food Procurement

A 50 location Skilled Nursing organization needed to standardize their food procurement process and find opportunities to save money. Prior to partnering with Direct Supply DSSI, this organization was missing out on table stakes savings opportunities due to lack of contract compliance and effective order guide management. In addition to missing out on food cost savings, the internal team was missing out on operational efficiencies because of the lack of process and visibility into food procurement across the organization. 

Approach: Technology Driven Food Procurement

The organization enlisted the help of Direct Supply DSSI to put a process in place and drive cost and time savings for the corporate procurement and facility-level teams. After implementation of the best-in-class DSSI platform, the DSSI team started providing expert food procurement consulting services through the use of proprietary artificial intelligence and over 150 years of collective culinary experience. 

The food optimization process consisted of a team of skilled Culinary Consultants working alongside specialized AI technology powered by millions of lines of organization, supplier and industry data to find opportunities to save money and improve the process for procurement professionals. This process consisted of numerous steps to ensure the organization was presented with the best potential outcomes. 

Culinary Consultation

The first step in the optimization process was for the Direct Supply DSSI Culinary Consultant to meet with the organization’s procurement team to learn about their current practices, goals and other important information to consider during the process. The DSSI team and the provider’s procurement team met on a biweekly basis to stay aligned on the strategy, which provided a strong base for the partnership moving forward.

Activation of Proprietary OGM.ai™ Technology

Following the initial meetings to align on goals and expectations, the Culinary Consultant at Direct Supply DSSI reviewed the provider’s existing food order guides on the patented OGM® 3 platform to identify themes and note any points of interest to consider moving forward. The Culinary Consultant then activated the proprietary artificial intelligence tool OGM.aito begin the initial review process. 

AI-Driven Food Category Optimization

The OGM.ai technology reviewed all product data across food suppliers and other providers on the DSSI platform and cross referenced directly with their existing order guides, supplier contracts and rebates, and GPO programs to find potential product recommendations that would save money.

Human Validation

After the OGM.ai technology completed review of all the data in the DSSI ecosystem, the Culinary Consultant reviewed the proposed changes and validated accuracy and alignment with the organization’s goals. The Direct Supply DSSI team selected only the most impactful suggestions and used the unwanted recommendations to train the OGM.ai technology and make it smarter.

Food Procurement Recommendations

Following the recommendation validation, the Culinary Consultant presented all relevant recommendations to the provider organization for their internal review. The teams discussed the suggestions and determined which recommendations the customer wanted to implement.

Recommendation Implementation 

The Direct Supply DSSI team supported the implementation of the the accepted recommendations by updating order guides, allowing the internal procurement team to focus on change management at the facility level. These changes supported healthcare best practices in food procurement and made the organization’s procurement team more efficient, allowing them to focus on more value-adding priorities.

Continuous Monitoring 

The savings and efficiencies didn’t stop after the initial food optimization. The OGM.ai technology continued to scan the data every night, providing savings recommendations on a daily basis. The technology also identified discontinued products automatically and provided product substitutions, shifting these processes from reactive to proactive.

Result: Transformative Food Procurement 

This 50 location Skilled Nursing organization saw significant cost and time savings due to partnering with Direct Supply DSSI. Some notable results from their initial food optimization include:

  • Review of 1031 products across their food order guides (through the OGM.ai technology and the Culinary Consultant) – all work done behind the scenes.
  • Implementation of 737 of product recommendations provided by the technology and vetted by the DSSI team – a direct result of the partnership of the provider, technology, and Direct Supply DSSI. That is a 72% acceptance rate!
  • Savings of $105,126 annually in food categories as a result of the optimization.

Direct Supply DSSI supports procurement teams in driving healthcare cost savings and efficiency through the use of artificial intelligence and unparalleled levels of procurement expertise. Take a look at a similar case study for an Assisted Living organization to see the power of this solution.

Interested in learning more? Read our blog “Achieve Strategic Purchasing with Direct Supply DSSI“.

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