Managing unofficial inventory: a piece of the materiel management foundation

The implementation plan will remain the same: target an area of opportunity, measure and document the amount and value of the unofficial inventory, establish PAR levels, implement the use of hand-held terminals to assist in inventory control, and integrate inventory control with the implementation of new programs that will impact ordering, receiving, distribution, and invoicing. It is anticipated that the inventory in the main OR alone can be reduced by $1.5 million if we move forward with a stockless JIT system. This would reduce the days of inventory on hand from approximately 100 days to between 7 and 14 days. This could also mean a holding cost reduction of $150,000. The merit of reducing unofficial inventory is evident. Managing unofficial inventory is merely one piece of the successful materiel management foundation. The other foundation pieces include contract compliance and price negotiations, systematic methods of ordering products, and timely distribution of products to the end user. PHS cannot effectively move forward to a new, innovative materiel system for the future until we first measure, analyze, and document the present conditions. Once the foundation is laid by improving present business practices, then the framework of the structure can be designed and constructed. The goal is to implement a system that utilizes the full potential of people, equipment, logistics, and information so that our customers, the patient caretakers, do not have to worry about anything except the delivery of quality care.(ABSTRACT TRUNCATED AT 250 WORDS)     

The materiel manager-chief financial officer alliance.

There is a gold mine of potential inventory reductions, expense reductions, and revenue increases in most hospitals that can be tapped by more intensive materiel management. The first step is incorporating the necessary ingredients for a strong materiel management effort--the right people and a state-of-the-art computer program. Reorganization may be necessary to establish a more unified, consolidated approach to materiel management. Second, conduct an audit of the entire hospital to identify opportunities for improvement and to establish baseline management data. Finally, push forward the process of system changes (which also establishes necessary controls) until results are accomplished--a process that usually requires one to three years. The alliance between the materiel manager and the CFO is definitely beneficial to the hospital and to the individuals involved.     

Purchasing: a necessary partnership

According to a recent survey published in Hospital Purchasing News, a Mcknight Medical Communications publication, the average hospital in the United States spent $16.7 million, not including equipment purchases, in 1994. This represents an increase of 41.6 percent over the amount spent in 1990, $11.8 million. The hospital's objective of having year-end revenues exceed expenses largely depends on the ability to purchase materiel at the best price, not necessarily the lowest cost. This goal can be achieved by partnering with suppliers and customers (hospital administrative and surgical staff, as well as patients) through open communication and trust. Reducing costs by a percent on the dollar could return $167,000 to the average hospital. Partnering can assist in achieving these savings!     

The materiel manager's role in executive management

The ability to achieve advancement for materiel management is a potential that few have challenged and achieved. Reasons for this lack of growth vary in degree, but the opportunities in the 1990s will be tremendous. The political skill and team leadership ability expressed by materiel managers throughout hospitals will ultimately result in whether this challenge is met or not. Materiel managers will need certainly to change their perception of their own role, as well as the perception of hospitals, in order to achieve this. The road will be challenging, but with the winning attitude, skill building, and proven management ability, I believe that materiel managers will become successful in hospital executive management in the 1990s.     

CEO expectation: the Star Wars materiel manager of the 1990s, or C-3PO as role model

Materiel-intensive expenditures account for a significant portion of all hospital costs, second only to salaries and wages, yet materiel managers may often be overlooked as key members of the management team. This is alarming since the potential exists for materiel managers to impact annual savings of hundreds of thousands of dollars by operating efficient departments. Materiel managers have a tremendous opportunity to enhance their image and improve hospital productivity in the coming decade. The challenges of the 1990s will stretch materiel managers' skills toward enhancing their professionalism and achieving the expectations of themselves and top management. If materiel managers will effectively utilize (C3)PO they will increase their educational levels, continue to learn new skills, maintain a customer-oriented management style, exercise creativity, develop and adhere to standards, and be proactive in their responsibilities. The benefits of their success will be felt by patients, hospitals, the industry, and materiel managers everywhere.     

Restructuring materiel management functions: a method for prioritizing changes and reducing costs

The success of any manager depends highly on the ability to seize on opportunities that will achieve the organization's goals. Hospitals are currently searching for ways to reduce costs while maintaining or enhancing the quality of services. Quality services are increasingly being defined as those that are most responsive to customer needs. It is important, as hospital management restructures materiel systems or methods of operation for reduced costs, to focus on the user departments as the customers. The consolidation of materiel management activity should not be seen as a loss of control at the user department level. Instead it can be seen as a new way of providing service with higher quality. User departments should see concrete benefits on a weekly basis, including reduced time spent on materiel management functions; increased planning of purchasing, inventory, and distribution functions; and assistance in meeting restricted supply budgets.     

Efficient materiel handling and distribution: a design perspective

This article offers a condensed examination of facility design and the interface between owners, hospital managers, and architects in planning for hospital materiel handling and storage needs. A brief history is given of the evolution of materiel management and progress today in efficient ordering, storing, distributing, and inventory and billing. The article closes with a discussion of work redesign and personnel vs. equipment concerns. Two case studies exemplify similar goals from different approaches.     

Materiel management reengineering: value creation through innovation

By reengineering their department's core processes, materiel managers can expand their role in the health care setting while realizing significant cost savings. Using a team model, Inova Health System materiel management staff integrated their processes for vendor selection, purchasing, inventory reduction, and utilization across three hospitals and ancillary services. An integrated approach at all levels of the organization gained buy-in from administrators and staff systemwide.     

Career survival strategies for materiel managers

The skill sets and attitudes required for materiel management professional survival continue to change. Just as the industry has evolved for calculators and three-part forms, so too must today's managers evolve into facilitators and information-oriented management. While these new skills are being perfected, three focused strategies initiated right now can enhance your chance for survival. First, get to know your customers intimately. Go to their meetings. Tour their departments. Second, assume responsibility and report materiel cost data that has meaning to senior management and customers. Fill rates and inventory turns offer little value to other managers, but supply cost per discharge can be of value. Third, be proactive in competing with outsourcing competitors. Do not wait until they are on your doorstep before developing a strategy to compete.     

Pressure ulcers and materiel management: cost-effective prevention and care

In summary, it's important for the materiel manager to have an understanding of the clinical aspects of pressure ulcers. By understanding how ulcers are staged, treated, and prevented, the materiel manager will have a better idea why certain products are needed and how they are used to reduce overall patient costs. Specialty beds, replacement mattresses, and high-end overlays represent a significant cost--approximately $500,000 to $1 million based on studies cited in this article. Further proven by research is the fact that these costs can be reduced by carrying out utilization plans with specific criteria for patient selection. Finally, materiel managers can be key coordinators in the entire process since they are often on the front lines in any institution's cost containment efforts.     

A new focus on inventory performance and bottom-line profits

This article is about a new way to measure inventory performance and about putting a dollar focus on inventory management priorities. It reviews the financial impact of inventories and shows how the information from any materiel requirements planning (MRP), MRP II, ERP, DRP, or orderpoint system can be used for setting individual objectives for inventory reduction, measuring performance by inventory segment, and monitoring continuous improvement. It will also consider the merits of paying performance bonuses to materiel planners and review some inventory reduction results.     

Hospital material management in Taiwan: a survey

The new insurance policy that began in 1995 for all people in Taiwan and severe competition within the health care industry are some of the pressing issues forcing hospitals to improve their operational efficiency. A primary productivity improvement for hospitals is the reduction of the cost of material management because the materiel function on average controls 30-40 percent of the operating dollars in a Taiwan hospital. In this article, a fuzzy clustering method is used to classify the different types of materiel management systems within Taiwan hospitals. Inventory turnover rates and fill rates are compared among those different types of systems by using multivariate analysis of variance. The results show that the differences in both inventory turnover rates and fill rates are statistically significant among different material management systems.     

Developing rapport between materiel management and surgery

A materiel management system, developed into an efficient organization, seems to be the most practical solution to solve interrelations between two complex operational departments, the CPD and surgery, be it for supply acquisition, inventory, processing, or distribution. The goal is to develop the most intelligent and efficient method so that the materiel management facility renders the required service to the surgical department, which in turn, services patient needs at the lowest possible cost.     

Materiel executives and the managed cost continuum in a capitated environment

Strategies that involve supplier partnerships and pose high risk for both hospitals and suppliers are an increasing trend. The materiel management professional who is proactive and able to assess risks in a managed care contractual environment will be the winner as materiel management becomes a network function rather than individual hospital function.     

How is your materiel management audit program?

This article has provided a view from the auditor's eyes of some key components inherent in a sound materiel management system. Every system, however, has its own unique characteristics, some of which may contain internal control situations that are not addressed herein. Although most will apply, not every comment contained in this article will be practical to all systems. The hospital size, utilization, patient mix, service mix, physical outlay, organizational structure, financial condition, and management philosophy will all have an influence on the role of materiel management. Automation of various materiel management functions can be beneficial by providing informational and control enhancements not feasible in a manual system. However, automation also raises new internal-control concerns that need to be addressed. Strong internal control techniques and compliance with adequate policies and procedures will prepare materiel management for its role in future hospital operations.     

A mutually beneficial supply partnership at Columbia Hospital for Women Medical Center

Columbia Hospital's variation of the JIT system to support its repetitive-type surgical procedures performed by the L&D and OR departments has proven to be the right system for this specialty care hospital to ensure that the right product at the right price is available at the right place and time. This system established by the cooperative efforts of the three partners involved (the hospital, manufacturer, and distributor) has been a win-win system for all. The manufacturer and distributor receive a profitable return for their products and services, and the hospital receives reimbursement for the products it utilizes to provide quality care to its ultimate customer, the patient. Columbia's supply flow system, as described herein, is a creative example of the many variations of the stockless or JIT supply systems being established in the world of hospital materiel management today.     

Empirical comparison of just-in-time and stockless materiel management systems in the health care industry

Despite the limitations, this study is the first comparative empirical investigation of two relatively new materiel management systems applied in hospitals. The results show that hospital managers have significantly rated the possibility that more effective use of some materiel management resources can be achieved by adopting either a JIT or stockless system over conventional materiel management systems.     

装甲装备周转器材多级库存控制优化研究

分析了我军装甲装备周转器材库存控制现状,借鉴供应链管理环境下的多级库存优化控制思想和美军先进的速率管理理论,采用联合库存管理和多级库存优化控制策略对周转器材库存进行优化控制。     

Materiel management in the operating room: a case study

The hospital continues to be pleased with the progress of our material services program in all areas, but especially surgery. It took a few simple, basic methods, such as exchange carts and inventory control, mixed them with people who actually care about doing a good job, and the whole program moved forward dramatically. People, both in materiel services and surgery, have accomplished a tremendous amount in the past two years. They have made, and will continue to improve, an already excellent program.     

A simple process for controlling operating room specialized inventory

As with any new system, success would not exist without team efforts. Cooperation from the materiel service department played an important role in its success. Prompt purchase orders and a prompt delivery system are a must when PAR levels are kept at a minimum. The new manual inventory system became an efficient and effective alternative to controlling products within the surgery department at Tampa General Hospital. And now for automation!