19 / 10 / 2015
A constant fluctuation of stock levels, lack of product visibility and traceability, and evidence of wastage indicated that Portsmouth Hospitals NHS Trust’s supply chain was not performing to optimum capacity.
By adopting an innovative inventory management system, the trust has revolutionised the way it spends money, realising significant cost savings, reducing waste and improving efficiencies.
The organisation is keen to share its experiences with other trusts to help them achieve comparable success.
This case study is most relevant to:
- Acute trusts
- Foundation trusts
- NHS trusts
The challenge and the context
Inventory management, and existing systems unable to respond to the demands of modern hospitals, remain an issue at national level. To address this, the government has mandated all trusts in the country to implement inventory management and adopt GS1 coding standards to improve patient safety and outcomes; savings and efficiencies; data standardisation, reporting and visibility; and management information and costing.
To meet these requirements – and as part of Portsmouth Hospitals NHS Trust’s (PHT) mission to incorporate innovation into all aspects of its services, to remove outdated practices and achieve additional cost-savings – a review of its supply chain practices and procedures was undertaken.
The initial analysis flagged several areas of concern. This included poor product visibility, lack of product traceability, inadequate storage space, weak data, and processes heavily reliant on manpower from clinicians.
What they did
After much research, the trust selected Ingenica Solutions, the organisation behind the first GS1 certified inventory management solution in the NHS. The team is highly experienced in this area and the system is a simple yet powerful tool that is intuitive for staff to use.
The project began with implementing the inventory management solution across a 27-theatre complex and 40 supporting locations. A number of other areas, including cardiology, audiology and wards have been completed, with full roll out across the trust currently in progress.
The most significant challenge faced was the management of change and new processes, asking people to transition from a way of working they were familiar and comfortable with, to a new, better way of working.
Commitment and engagement of staff across the trust was essential with a project of this size, and everyone, regardless of their role, had an important part to play in its success.
Results and benefits
Through the joint support of the trust's internal team and Ingenica Solutions, PHT has exceeded government requirements such as those in the eProcurement Strategy. The new processes have enabled consolidation of orders, monitoring of supplier lead times, and data to support rationalisation and standardisation of products, all aiding an enhanced procurement process.
Subsequently, this has helped secure cost savings, provide patient-level costing and improve supply chain efficiencies and management information.
The benefits have far exceeded early forecasts, and include:
- Cost savings
- More than £1.78 million in balance sheet savings
- Consignment stock savings of £350,000
- Releases clinical time back to the front line
- Three whole-time equivalent clinical posts, saving £108,000
- Provides accurate real time data, stock valuations and usage, per speciality
- Improved management of consignment stock creating in excess of £200,000 savings
- Increased contract coverage
- Manages expiry dates
- Reduces and records wastage:
- £885,000 stock reduction – 13 per cent
- £31,000 space savings
- Reduction in product lines by 1,300
- Waste reduced by £75,000 through negotiation with suppliers and through a rigorous prioritisation of short life stock
- A cleaner more organised environment
In terms of GS1 standards, the trust scans all products with barcodes.
PHT is one of the first trusts to roll out a single inventory management solution, trust-wide, in the UK. It is also leading the way with its adoption of GS1 standards, setting the benchmark for others.
While rolling out the inventory management solution across theatres, PHT discovered that most products on the shelf did not have a unique identifier –13 different types of barcode were found, and there were multiple codes from suppliers, distributors and manufacturers leading to a lack of clarity and poor data. What this did was highlight the need for GS1 standards and ensured a focus on this at the same time.
- Be prepared for a huge challenge! It’s hard work, there will be other challenges that arise and further issues that may be discovered during the process, yet being part of such a change programme is rewarding.
- Physical volume and range of stock found in a trust along with inadequate storage.
- Data is key: most trusts' data will not be as good as they think it is. Without data you can’t get meaningful information.
- Ensure you have staff engagement and open communication. Keep staff regularly up to date with project news and developments, and ensure they are all part of the process.
- Select a flexible, long-term solution – PHT chose to work with Ingenica Solutions not only because of the team’s hands-on approach and expertise, but also because they have developed an incredibly advanced solution that supports the trust's long-term plans. Avoid any short-term fix: it will cost more in the end.
- Visit other trusts – learn from trusts that have already implemented these systems. Visit the trusts, see the systems in action, understand their experiences and ask questions to find out more about the entire process.
- Choose carefully who is to both sponsor and lead of the project – this can make the difference between success and failure.
- Start looking at data requirements early, don’t assume anything.
Want to find out more?
Please email Jackie Pomroy, head of supply chain at Portsmouth Hospitals NHS Trust, at Jackie.firstname.lastname@example.org
You can also find out more in Jackie's NHS Voices blog post: 'Innovative technologies are key to tackling the NHS cash crisis'