Reducing Stock-Outs in MD Anderson Cancer Center’s Outpatient Clinics David Bivens, Caitlin Byler, Rachel Douglas, & Kaycee Wilson Speaker: Kaycee Wilson, Quality Engineer

Supply Availability Project Teams Steering Committee Office of Performance Improvement Materials Management Melanoma & Skin Center Susan Ferguson Cynthia Powers Jeremy Viles Byron Main Jimmy Sherman David Bivens Rachel Douglas Kaycee Wilson Caitlin Byler Antonio Odems Pete Verdone John Morgan Travis King Carl Crofton Mimi Brooks Oguna Taylor Cynarra Osborn Oletha Jones Rosa Rodriguez

Collect Supplies from Staging Area Deliver Supplies to each Par and Restock Identify Supplies that need to be Reordered Reorder Par less inventory on hand by putting the count left in the bin in the handheld. Supplies are Used Current Inventory Management Process Note: Those orders arrive the next evening 2 Note: Items Received were Ordered Night Before Clinic Close Clinic Open

New Supply Process Objectives  Quantitative Objectives Minimize: Stock-outs ( Patients Denied Care ) Subject to: Available Space Available Labor Inventory Cost  Qualitative Objectives Ease of Use Ease of Implementation Ease of Sustainment

Process Observation and Analysis Four inventory process areas were identified for improvement efforts Level Setting Reorder Signal Reorder Quantity Business Roles

Baseline Analysis Level Setting

Pilot Solution Level Setting 1. PAR Level 2. Reorder Point There are two numbers important for level setting Reorder Point Based on a one day delay between order and actual delivery Calculated with historical ordering data by material reps Calculated based on items pulled from the warehouse Derived using statistical analysis yielding stock-out risk PAR Level Based on current workload

Baseline Analysis Reorder Signaling

Pilot Solution for Reorder Signaling

Baseline Analysis Order Quantities The materials rep will have to put the number remaining in the bin in the handheld.

Pilot Solution Order Quantities Always order the same amount Always order about ½ bin size

Baseline Analysis Business Roles Materials Management Responsible for responding to clinic requests for par changes Responsible for order and delivery of supplies Clinics Responsible for setting the inventory level of each item

Daily Clinic Usage Nightly Replenishment Pull the card when the supply level is at or below the tapeline 1 Place the card in the low stock bin 2 Deliver supplies & make sure that the waterline holds the “reorder point” quantity 1 Put all cards in the ordered bin back on delivered item bins 2 Pull out all of the cards in the “low stock” bin 3 Scan the barcode on the back of the card and enter the handheld # in handheld. If you have to pull the quantity from the warehouse, pull the warehouse # amount Back of Card 4 Place scanned cards in the “ordered” bin 7 Pull the card when you use the item 1 Ordered Low Stock Pilot Resupply Process and Business Roles ! Note

PAR Setup Process and Business Roles Card Slot Clinical Team Materials Management Team Approve/Disapprove suggested removal of items 3 Reset levels 1 Request approval for removal of low usage items from Par (Red Tagging) 2 Put in waterlines and adjust preset levels 4 Reorganize closet with nursing feedback 5 Relabel 7 Create Stock Cards 8 Reset Par in handhelds 6 **Blue boxes represent steps requiring tool created by OPI

P59 Melanoma and Skin Center Baseline

P59 Melanoma and Skin Center Pilot Setup

Tapeline Setting & Fixed Ordering Methodology (R,s,Q) Model

Tapeline Setting & Fixed Ordering Methodology Reorder Point

Tapeline Setting & Fixed Ordering Methodology **See References Slide

Reorder Point Setting & Fixed Ordering Simulation DEMONSTRATION

Stock Card Template

Summary of Assumptions Objective – stock-out minimization Carry a minimum of two days on hand Constraints – labor, space, and budget Increase the days on hand to meet labor standards Distribution of daily demand - normal Set reorder points according to a normal distribution Daily supply usage Estimate daily demand using work days between ordering instances

Pilot Issues

Future Work Pedi – Child & Adolescent Center Cardiopulmonary Center Breast Center Leukemia Center Clinical & Translational Research Center

References Junior, M.L. and M.G. Filho Variations of the kanban system: Literature review and classification. Int. J. Production Economics, 125: Chan, F.T.S Effect of kanban size on just-in-time manufacturing systems. Journal of Materials Processing Technology, 116: Kumar, C.S. and R. Panneerselvam Literature review of JIT-KANBAN system. Int. J. Adv Manuf Technol, 32: Bijvank, M. and I. Vis Lost-sales inventory theory: A review. European Journal of Operational Research, 215: Johansen, S.G. and R.M. Hill The (r,Q) control of a periodic-review inventory system with continuous demand and lost sales. Int. J. of Production Economics, 68: Bijvank, M. and I. Vis Inventory control for point-of-use locations in hospitals. Journal of the Operational Research Society, 63: Baganha, M.P., D.F. Pyke, and G. Ferrer The undershoot of the reorder point: Tests of an approximation. Int. J. of Production Economics, 45: Silver, E.A., D.F. Pyke, and R. Peterson Inventory Management and Production Planning and Scheduling. 3 rd Edition. Hoboken, NJ: John Wiley & Sons.