DEMAND FLOW Objective One: Save Critical Resources: Time and Money! Objective Two: Remove silos and develop a unified data driven supply chain operation Objective Three: Introduce and sustain standard work and lean processes that drives

continuous improvement1. What improvement was needed and why? Transform Mercy Hospital’s supply chain operation

into a competitive advantage by building visually managed kanban/distribution system that is focused on Total Cost of Ownership and waste elimination. The previous distribution program was very fragmented and poorly structured leading to the following challenges:

A Compartmentalized Supply Chain Operation (OR and Lab did their own thing) which led to a significant amount of rework, redundancies, and excess waste

High inventory levels that served as a safety net for poor inventory management – resulted in a waste of resources (time, money, and space)

No standard work or distribution process that supported continuous improvement Poor data/analytics (no metrics to measure performance)

2. What evidence was in the improvement? a. Reduced medical supply expenseb. The clinical end-user is completely removed from the supplies management businessc. Predictable / visual operation unified the supply chain

3. What outcomes were achieved?a. Clinical hours spent in supply chain reduced by 28,000 hours a year b. 30% less storage space required on nursing unitsc. New system supports all areas of hospital (not just impatient) with less resourcesd. 97% overall fill-rate (from 82%) for entire hospitale. Annual medical supply expense reduced by ~ $1 million f. Warehouse space reduced by 50%g. 33% Supply Chain staff efficiency (3.5 FTE savings)h. Removed risk for replenishment errors by replacing a manual par cart to visual

automated system4. Increase in staff satisfaction – 91% overall satisfaction rating5. Can this work be replicated? Yes Implementation Process:

1. Item Master Readiness2. House wide program introduction 3. 5S work area4. Data review/forecast5. Mockup event with clinical participants6. Installation 7. Training

8. Sustain (Metrics/Dashboard, Standard Work, and continued leadership support Describe the specific improvement:

1. Neat and orderly supply room (clinical and nonclinical)2. Concise reorder processes (no “eyeballing” supply quantities)3. Visual alerts trigger immediate action4. Eliminated excess and expired supplies from all work areas5. Stat calls eliminate, clinicians have everything they need to do their daily work6. Unified supply chain driven by standard work7. Significant reduction in time, space, cost, and other resources

What tools or people were key to success? BlueBin Inc. - a group of working consultants focused on providing best-in-

class supply management systems to healthcare institutions and medical centers across the globe

Clinical Staff Supply Chain Engagement Leader Demand Flow Tech Demand Flow Dashboard Various Kanban Bins and Racks

Measurement:

Results/Success:

1. What were the outcomes of this work beyond your metrics? Rapid 5 S (very clean and organized) High satisfaction from clinicians

Increase in supplies Easier to retrieve supplies More time to take care of patients Very clear instruction on use of the program

2. How were quality, service resources, etc. improved from this change? Average time to service a supply room was reduced by 30 minutes Average sku availability increase twice as much in same location Reduce/eliminate the opportunity for obsolete items 33% FTE efficiency improvement

3. Comment on key learnings and suggestions for replication elsewhere. Consistently communicate the changes and expected outcomes before, during,

and after project Create and uphold standard work to drive continuous improvement Data, Data, Data!!! Build relationships with the clinicians…their input is critical