What do automotive manufacturing and healthcare material handling have in common? More than you would think. In the late 1980’s the use of a two-bin system for inventory management started showing up in healthcare supply rooms. The two bin system allowed hospitals to implement the lean manufacturing process – Kanban.
Developed at Toyota to achieve JIT (just in time manufacturing), Kanban was modeled after grocery store inventory management. A grocery store only stocks what they think they will sell in any given period, using signage and way-finding to help the user locate the items they need. (The word “Kanban” literally translates to “signboard” in Japanese). The barcode located on every item in the store is scanned and signals when the item needs to be reordered. This process aligns inventory with actual consumption. As opposed to pushing product on the stores expecting them to sell, the Kanban system uses a pull methodology to monitor and set inventory levels.
The logistics of maintaining hospital inventory and making sure items are at the right location at the right time can cost anywhere from 30-40% of a hospital’s operating budget. The reduction of those costs with increased efficiency is often at the top of hospital executives’ lists. There have been many solutions proposed to hospitals to manage inventory. However, most don’t increase efficiency or reduce costs. Some methods require action on the nursing staff’s part; like scanning a barcode every time an item is retrieved. And others require significant investments such as purchasing automated cabinets that need a patient ID and access code to retrieve items.
The Kanban system is passive. It requires no work on the nurses’ part and very little time for supply chain management staff to count inventory. The two bin system has the same items in each bin (Bin A and Bin B). The nursing staff retrieves items from bin A and when bin A is empty, the nurses then retrieve the items from bin B. When the supply chain management staff comes around to count inventory, they only reorder the items where Bin A is empty. The “back-up” bin (Bin B) always ensures that the nurses will not run out of inventory.
The advantages of Kanban are numerous.
- The workload for both the nursing staff and supply chain management staff is reduced.
- The amount of time the nursing staff spends on operational errors or locating out of stock items is decreased.
- The amount of time non-medical staff (supply chain management staff) is on the patient floors is reduced, thereby reducing infectious control hazards.
- The actual amount of inventory kept on hand decreases in turn reducing costs.
Due to the reasons listed above and others, it’s no surprise that many hospitals are moving towards Kanban. For storage geeks like us, this makes us want to throw a party. We are 100% on board with helping healthcare facilities become more efficient in storing and managing their supplies. And if you let us get our hands dirty, we can help do it in less space.
With our FrameWRX shelving we can implement the two bin system by using vertical and horizontal dividers in our wire shelving and plastic bins. Large, clearly marked, color-coded labels will quickly direct nursing and supply chain management staff to the items they are looking for. FrameWRX also maximizes vertical wall space while minimizing floor space – allowing for more items in less square footage. On top of all of that, it’s modular. As things change, or new items are brought into the mix, the supply chain management staff can quickly reconfigure the shelving.
Hospitals aren’t making cars, but they are fixing people. Operating at top efficiency is key when someone’s life is at stake. For more information on designing Kanban-ready supply rooms, contact your local Patterson Pope representative today.
