Why inventory management is integral to healthcare efficiencies
Author: Monika Nott is inventory management improvement project lead at Taunton and Somerset NHS Foundation Trust, and participant member of the Southern GS1 and Scan4Safety adoption group
By making sure every penny spent delivers the best levels of care and clinical outcomes, one of our key principles at Taunton and Somerset NHS Foundation Trust is to run as efficiently as possible, at a cost of 10 per cent less than the average hospital in England.
With 700 beds, 30 wards, 15 operating theatres, more than 4,000 staff, and an annual budget of £246.7 million, ensuring the trust works safely, efficiently and productively is essential. Our financial savings plan pushes the idea of discovering better ways of working - ways that do not impact clinical staffing levels or quality of care, and improving how we manage the products we buy and consume is an integral part of this. To do this, our inventory management improvement plan was developed to review and modernise processes. This proved an enormous success and triggered implementation of our chosen inventory management software solution.
The key outcomes of this project were to improve efficiency, secure cost savings, and ensure better patient safety and experience; targets which have been achieved. However, the journey to reach these outcomes was a challenge, working to overcome issues inherent and typical to every NHS trust.
Inaccurate data, excessive inventory, no reliable automated system to record stock transactions, poor stock visibility, and a shortage of storage space, for instance; issues which together had a cumulative effect leading to inefficiencies and waste.
Following comprehensive research, visits to early adopter sites, meetings with suppliers and a mini competition on an existing NHS framework agreement, we selected Ingenica Solutions 360 to help transform the way we manage inventory.
Beginning an implementation of this type in a high-value, busy area, such as operating theatres, as we did, was fundamental in providing an organisation-wide view of inventory levels. It provided an opportunity to transform processes, improve data and gain greater control over purchasing and inventory.
The cost of supplies forms a very significant part of expenditure here, so significantly improving the way in which healthcare inventory was acquired, stored and managed was critical to operational improvement. Equally, understanding the costs of products used on specific patients moves us towards demand-led, outcome-based procurement. Enabling effective inventory management delivers good data which now drives all our purchasing decisions, and supports accurate patient level costing by tracking and tracing product usage throughout the supply chain.
One of the most notable improvements is staff efficiency. As our old labour-intensive, manual process to manage stock has been eliminated and replaced with the online system, there has been a 90 per cent reduction in the time spent by clinicians on ordering, replenishing, or locating products. This time is now spent face-to-face with patients.
It has also been possible to change our relationship with suppliers and with improved data, gives an advantage back to our procurement team; facilitating accurate usage information that can support contract negotiations, and manage supplier performance. What’s interesting about a project of this nature is that it not only benefits our frontline clinicians, procurement and supply chain teams, it has benefits trust-wide, for finance, patients, managers, everyone. It has been a collaborative approach, making a difference to the roles and responsibilities of the whole workforce and has really opened our eyes in terms of what technology can really provide and where using it can really generate results.
The scale of efficiencies that has been achieved through improved inventory management is compelling, with sustainable benefits which are yet to increase further as our project continues to be rolled out across the trust. We have cut costs, reduced wastage, gained operational efficiencies, and improved patient safety. In fact, over £1 million since 2016 has been saved from automating ordering, reducing wastage and optimising stock levels to what is required to meet the needs of the patients we treat.
Driving change through the adoption of new innovative supply chain practices is integral to healthcare efficiencies, and to meet key government requirements such as the e-Procurement Strategy and the Scan4Safety initiative. Inventory management plays a key role here, and is bringing significant long-term benefits to organisations in the NHS. Isn’t it time that all trusts maximised healthcare back-office efficiencies?
This opinion piece was first published on NHS Voices, the NHS Confederation's blog for NHS leaders.