Matt Brennan, formerly the director, Surgical Support Services, Supply & Logistics at a large academic institution, developed this presentation to share the story of his experience working with a combined team of emergency department nurses and supply chain staff to develop a new, lean approach to supply management in the ED. Matt reviews the benefits that can be achieved using a Lean Six Sigma approach to continuous improvement with nursing staff, including: - Significantly increasing nurse satisfaction and reducing nurse turnover - Measurably reducing labor and supply costs - Ensuring the optimal match between inventory management approach and the unique needs of each department, specifically, identifying less expensive methods of commodity product replenishment - Working with a black belt consultant, this team of ED nurses, supply & distribution and administration staff held a Lean Six Sigma Kaizen event to redefine and redesign processes. Their results included: - Fewer SKUs ordered on a daily basis - Reduced staff touches - Elimination of cycle counts within PAR areas - Elimination of data entry errors - Reduced nursing time spent on supply management - Reduced restocking time for staff - Fewer stock-outs (1.5%) - Improved cabinet-system compliance (74% to 97%) - Improved nursing engagement This presentation is designed to help supply chain leaders in hospitals create effective partnerships with nursing teams, leveraging the unique strengths of both nursing and supply chain leaders in designing systems, and avoiding pitfalls that cause delays in making improvements to your supply management programs.

1. Welcome to the Webinar
1
Build a Lean Six Sigma Process for Inventory
Management to Drive Nursing Satisfaction and
Supply Cost Reduction
Presenter:
• Matt Brennan, healthcare supply chain expert;
• Senior Healthcare Supply Chain Consultant to Jump Technologies, Inc.
Questions?
• Q & A will take place at the end of the presentation
• To submit questions at any point during the webinar, please use the “question” function
CPEs
1.0 AHRMM - accredited Continuing Professional Education contact hour

2. Learning Objectives
• Identify benefits that can be achieved by implementing a Lean Six Sigma
approach to continuous improvement with nursing staff
• Understand inventory management approaches and determine how to
select an approach that meets the specific needs of a department or area
of your hospital
• Evaluate less expensive methods of replenishment for less expensive /
commodity products

3. Emergency Department Background Information
• Level 1 Trauma Center
• 52 Beds
• 12 Observation Beds
• Suburban MSA
• Academic Center
• ~ 200 Visits / Day
• 72,000 Visits / Year

4. The Problem
• Became the primary Level I Trauma Center within 75 mile radius
• Space / Clutter
• 52 Pyxis cabinets
• 42 supply carts
• Supply boxes in patient rooms
• Poor Pyxis compliance
• Hoarding of supplies
• Little confidence in Supply Chain support
• Highest RN turnover rate in the Medical Center

5. The Cost
• Average of 2hrs 14mins spent by nursing (per 12 hour
shift) stocking rooms and carts
• Approx. $353,000/year paying nurses and ED techs to
stock
• 52 Pyxis machines in the ED
• $300,000 / year equipment leases
• $70,000 / year line charges

6. What We Did
Lean Six Sigma Kaizen Event:
December 2012
Design & Evaluate Methodology:
January 2013
Conduct Pilot:
February thru April 2013
Team Included:
Nursing
Supply & Distribution
Administration
Black Belt Consultant

7. What is a Kaizen Event?
Kaizen, also known as continuous improvement, is a long-term approach to
work that systematically seeks to achieve small, incremental changes in
processes in order to improve efficiency and quality.
In a typical Kaizen event:
• Team members meet 5 straight days to overhaul a core work process
• The week begins with just-in-time training in Kaizen methodology
• They map out the current state of the process, analyzing every step to find
all forms of waste: over-processing, delays, loopbacks, handoffs, excessive
inventory, work arounds
• They use their findings to develop a new process that is simpler, faster,
better and more cost-effective
• Action plans address all aspects of implementation, including training and
communication

8. How Do We Make it Better?
“If you can’t measure it,
you can’t improve it.”
Peter Drucker

9. RN Satisfaction Survey
Agree,
92.54%
Neutral,
5.97%
Disagree,
1.49%
The current stocking process NEGATIVELY
impacts patient care
Agree
Neutral
Disagree

10. Supply Tech Satisfaction Survey
Agree,
9.00%
Disagree,
91.00%
I am content with the current format of stocking the
Pyxis machines in the ED

11. Flow Chart of Current State
Supply & Distribution
Emergency Department

12. Operational Adjustments
• Chargeable supplies redefined
< $25 = Non-Chargeable (Kanban) 85%
> $25 = Chargeable (Closed Pyxis) 15%
• Non-chargeable supply amount was built into the visit acuity charge
• Pyxis lease was renegotiated

13. Kanban Choices Evaluated by Team
• Kanban cards
• Divided baskets
• Left to right
• Front to back
• ‘Flipper’ dividers in metal baskets
• Two colored reversible bins (blue/orange, black/red)
• 3 Bin (One in front of the other) empty bin returned to supplier
• 2 Bin (One in front of the other – neither ever leave the location) *
• Watermarks (accommodates items too large to fit in bins) *
* indicates methodologies chosen

14. KISS - Keep It Simple Solution
• Pilot Study (Busiest of 7 care areas)
• 60 days, starting in February, 2013
• Remove 11 of 13 Pyxis cabinets in the pilot area
• Replace with closed 2 Bin cabinets
• Scan empty bins by 11 AM, replenish by 10 PM
• Successful interventions will move to entire ED

15. 2 Bin Flexibility

16. Kanban Types
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Watermark 2 Bin

17. Bin Refill of the Kanban System
Used the last item in a Bin? Place empty bin on TOP shelf
Pull second bin
from the back
to the front of
shelf
Empty Bin?

18. Data Collection
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19. Key Fob Scanner
• 1 Scan / Second
• Micro USB
• Communication
• Charging (Lithium Ion Battery)
• $96 / each
• No keyboard (no data entry errors)
• Single button scan
• Audible and visible ‘good scan’ verification

20. Mistake Proofing
The 6 Most Common Errors Solved by 2 Bin Kanban:
1) Decision making (eyeballing)
2) Counting
3) Transcription
4) Data entry
5) Math errors
6) Stock rotation
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21. New Key Performance Indicators (KPIs)
ARV vs. PRV
• When Actual Replenishment Velocity (ARV) is added to KPIs, and compared to historical
or Projected Replenishment Velocity (PRV), supply staff can focus on the 10-15% of the
stock moving more quickly than expected (greatest chance of stocking out)
• The other end of the spectrum, the 10-15% of stock moving more slowly than expected
• This is the stock that sits idle, with greater chance of expiring
• When managed, it can provide space to increase the quantities of the rapidly moving
stock
• Remaining 70-75% of stock being consumed at the projected rate only needs a simple
barcode scan to trigger an error free order
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22. Simplifying the Data
22

23. Supply Categorization

24. Visual Item Management
Shelf Labels Examples
Visual Item Management

25. Visual Cart Management
Cart Signage
Visual Cart Management

26. Visual Bin Management
Visual
indicator
linking bins
with Item
categories.
Visual Bin Management / Labeling (Kanban)

27. Efficiencies Gained
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- Fixed quantity replenishment
- Fewer SKUs ordered on a daily basis (40% fewer)
- Reduced touches by staff
- Eliminated cycle counts within PAR areas
- Eliminated data entry errors
- Reduced nursing time
- Reduced restocking time for supply staff
- Fewer stock-outs (1.5%)
- Improved Pyxis compliance (74% to 97%)
- Improved nursing engagement

28. Bin Capacity Plan
• 2 days / bin X 2 bins = 4 day supply
• Typical Med/Surgical nursing unit
• 3 days / bin x 2 bins = 6 day supply
• Critical Care nursing units
• 1.5 days / bin x 2 bins = 3 day supply
• Monday – Friday, 8 hour clinic locations

29. Nursing Engagement
Communication Plan for 2-Bin Kanban Implementation
Unit: Leadership Contact Name:
Timing
Dates
Assigned
Tasks/Events Supply & Logistics Ownership Nursing Ownership
Date
Completed
Completed By
Week 1
Meeting - Introduction to Kanban and Assign Ownerships A.R. required required required
Appoint Key Nursing Contacts for Item Layout Assistance P.B. required required required
Week 2
Meeting - Kickoff Meeting with Nursing Team J.H. & S&L Install Team required required required
Meeting - Obtain Approval for GO-LIVE Date (layouts
reviewed)
M.B. required required required
Communication - Post signage of GO-LIVE Date M.B. required required
Communication- Email staff of up coming install M.B.
Communication - PowerPoint is pushed to Nursing Staff M.B. required required
Week 3
GO-LIVE J.H. & S&L Install Team required required required
Communication - Post signage for NEW PROCESSES M.B. required required
Meeting - Post GO-LIVE J.H. & S&L Install Team required required required
Week 4 Data - Reviewing/Updating PAR's P.B. required required required
Nursing Approval for GO-LIVE: Date:
S&D Approval For GO-LIVE: Date:

30. Before and After
Measurement Before
(PAR Cabinet)
After
(2 Bin)
Customer Satisfaction - 93% +91%
Compliance 74% 97%
Stock Out % 4.7% 1.6%
Lines (SKU’s) ordered / day (avg.) 167 101
Lines (SKU’s) put away / hour (avg.) 68 125
Time to collect replenishment data 14 minutes / location 5 minutes / location

31. Results
• Decreased number of Pyxis machines
• Decreased line charges
• Decrease clutter in rooms
• Eliminated overstocking
• Improved efficiency of stocking process
• Increased nursing and tech satisfaction
• Improved patient care

32. Lessons Learned
• Strong executive sponsorship
• Pilot was too successful
•Initial concern that there are “An awful lot of empty bins”
• Orientation for new nursing hires
• Top shelf for empty bins only
• Supply staff scanning partially empty bins – “Just to be safe”

33. Frequently Asked Questions
• Why don’t you like Point of Use cabinets?
• Why didn’t you just use RFID throughout?
• What impact does 2 Bin have on supply consumption?
• Does your Days On-Hand inventory change?
• Do you have 7 Days/Week deliveries?
• Why do you visit each supply location twice/day, is that lean?

34. Q & A
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35. Thank You
Learn More About JumpStock™ Inventory
Management
Confidential. Copyright 2016 Jump Technologies. All rights reserved.35
Product Education Webinar
Thursday, March 3 – 11:30 AM ET (8:30 AM PT)