Lean Six Sigma yields big pharmacy inventory savings


Bill Owad

Senior Vice President
Operational Excellence
Cardinal Health

As Zanesville, Ohio-based Genesis-Bethesda and Genesis-Good Samaritan hospitals prepare to combine into one completely renovated facility in 2015, one of their key goals is to gain efficiencies. And one place they're starting is by unifying their two pharmacies.

Construction and renovation projects usually offer an opportunity to design new processes, improving those that may have been hindered by physical barriers. But with the Genesis pharmacies, challenges involved more than just physical space, movement and flow. As Genesis’ Lean Six Sigma experts analyzed the pharmacies’ operations, they uncovered a contrary set of numbers that presented an even greater opportunity to improve efficiencies.

As medication inventory turn rates had fallen from 14 turns in 2012 to 10 turns in 2013 (approximately a 25 percent inventory increase), patient volumes had decreased by about 10 percent over that same period.

With more than $1.6 million in pharmacy inventory, tackling this contrary set of numbers would certainly enable the hospitals’ Lean Six Sigma experts to improve efficiency and reduce unnecessary costs. But doing so would be no small challenge.

So, how did Lean Six Sigma experts from Genesis implement an inventory control system for more than 3,000 drugs at five different hospital locations?

To find out, check out this white paper from the Academy for Excellence in Healthcare. And, if you're a health care professional who's interested in learning how to apply operational excellence principles to solve challenges like these, check out educational opportunities at the Academy for Excellence in Healthcare. The Academy is a unique partnership between The Ohio State University Fisher College of Business and Cardinal Health. It brings together a unique combination of academic and industry experience to help health care professionals identify and solve their greatest operating challenges.