Picking 52 Million Pieces A Year Is No Small Task ForChildren’s Hospital Colorado

Managing the supply chain in any organization can be a tough job, but at Children’s Hospital Colorado in Aurora, CO the materials management department is directly related to patient care; making it a critical function within the hospital. With 298 beds, getting supplies to the right place on time takes coordination, teamwork and a little technology. With the help of three KardexRemstar horizontal carousels integrated with pick to light technology and FastPic order processing software, the materials management stockroom picks over 141,000 pieces a day, delivering them throughout the hospital and on time.

Founded in 1908 in Denver, Colorado, Children’s Hospital Colorado set out to be a leader in providing the best healthcare for children. They have consistently landed in the top 10 children’s hospitals in the nation and have become a place parents across the Rocky Mountain region trust. With more than 1,000 pediatric specialists and 3,000 full-time employees Children’s Hospital Colorado is dedicated to caring for kids at all ages.

Recently,Children’s Hospital Colorado moved from their original location in downtown Denver to a new hospital facility in the suburb of Aurora. From private patient rooms to progressive medical technology to organized material and process flow; every detail of Children’s Hospital Colorado was built to maximize the patient experience, helping kids get better faster and reducing stress on the whole family. Children’s Hospital Colorado has grown with the community from 30 beds in 1908 to 298 beds today with plans to add another 124 beds next year.

Don’t Change a Thing

Strting from scratch was a perfect opportunity to restructure the materials management stockroom to improve processes and materials flow to maximize efficiency. “Our research determined that the horizontal carousel system we were using in Denver was the best solution for us. It was proven technology that had supported our materials management operations for over 15 years. We chose to replicate the system in the new Aurorafacility,” says Richard Hire, Director of Materials Management. The Denver facility and the Aurora facility had to operate simultaneously for a three month transition period, so the Denver horizontal carousel system could not be relocated.

In Aurora, Children’s Hospital Colorado installed three 52 foot long horizontal carousels from KardexRemstar, integrated with pick to light technology and FastPic order processing software to manage all low units of measure inventory(broken case pieces).The bulk case inventory and larger supplies are stored in an adjacent shelving area. With 1,700 SKUs, all of the stockroom inventory is managed by PeopleSoft software. The stockroom is responsible for three types of orders: automated supply cabinet restock orders, clinician orders and ambulatory cabinet restock orders.

Processing Orders For Everyone with One System

The hospital has 147 automated supply cabinets located on the patient floors that the stockroom is responsible for restocking. As needed nurses access the cabinet with a password, take the supplies they need and identify the patient receiving the supplies. Three to four times a day an automated ERP system inventories each cabinet and sends a replenishment order to the stockroom. The stockroom receives the order at theFastPicorder processing workstation for picking and fulfillment.

The clinicians on the floor can also place orders for supplies that are not inventoried and stocked in the automated supply cabinets, such as diapers. The clinician places the order through a PeopleSoft portal on the floor and the order is sent to the stockroom. The stockroom reviews the order and sends it through to the FastPic order processing software to be picked.

The stockroom also supports the non automated ambulatory cabinets, storing low usage supplies. The stockroom sends a runner in the morning to physically inventory the ambulatory cabinet and create a restock order. The stockroom enters the order into the PeopleSoft software and it is processed through to the FastPic software for fulfillment.

Dynamic Picking & Fulfillment

No mattr how the order is received, the process is the same. Once the order is released to the FastPic software the order picker can start to fill the order immediately. With the click of a button the three horizontal carousels spin and position for the first pick. Directed by pick lights, the order picker picks from the correct location the exact quantity of a specific item the order requires. The order picker confirms the pick by pushing a green task complete button and places the item on the delivery cart. As the order picker is picking the first item the other carousels are spinning into place, positioning for the next item to be picked. The FastPic software organizes the picking keeping the horizontal carousels working one step ahead of the order picker, so there is very little wait time between picks.

The entire horizontal carousel system occupies 1,690 square feet and is operated with one order picker. To replicate this system capacity using shelving would have required 42% more floor space (4,131 square feet) and more order pickers. “Without the horizontal carousels we’d have at least 8 more order pickers running around and searching shelving for items and it would take 10 times longer,” says Hire.

Once the delivery cart has all necessary supplies from the horizontal carousel area, the cart is moved to the runner. Approximately 70 % of the order is picked from the horizontal carousel area, leaving 30% to be picked from the bulk area by the runner before delivery. When the order has all required supplies the runner takes the order up a few floors to restock the automated cabinet or deliver the supplies to the clinician or restocks the ambulatory cabinet. The inventory is reconciled and the process continues. As a department standard, all orders are filled and delivered within two hours of when the order was placed.

Supplies… Stat!

If a clinician requires an item immediately, they can request stat delivery. The stockroom immediately releases the order to the FastPic software and the runner goes to the horizontal carousel area to retrieve the stat item. Using the hot pick feature in the FastPic software, the order picker is able to pause the current order they are fulfilling to pick the stat item. The stat item is handed to the runner who immediately delivers the item to the clinician while the order picker easily returns to the order they were fulfilling.

24/7 access to all supplies is required by hospital stockrooms. If the power goes out or the machine fails it is critical to still be able to get the supplies to the floors to care for the patients. “We deliberately had the horizontal carousels installed far enough apart so that in case of a power failure we can still access the supplies by walking up and down the aisles like shelving,” says Chris Houk, Logistics/Distribution Manager, “With the exception of our scheduled parts and maintenance on the carousels, we’ve had 100% uptime.”

Replenishment Made Easy

Replenishment reports for the stockroom are run twice a day. A replenishment report is sent from PeopleSoft software to the stockroom for review. When additional product is needed for the carousels, the order picker picks from the bulk shelving and is directed by pick to light technology as to where in the horizontal carousel to put or restock the item. For supplies that need to be reordered, the replenishment request is sent to purchasing and received into either the horizontal carousel area or the bulk area when the supplies arrive the next day to be replenished in the carousels.

Expanding The Stockroom

Children’s Hospital Colorado is building a new 10 story patient tower that will increase the number of beds to nearly 500. The state of the art medical tower is expected to be finished by late 2012. The East Tower will be home to an expanded specialty service: The Colorado Institute for Maternal and Fetal Health. The tower will also house several other specialty services including the Heart Instituteand Neonatal , Pediatric and Cardiac Intensive Care units.

With these new programs the stockroom will need to add new SKUs as well as increase the minimum inventory level of some existing SKUs, leading to more inventory in the stockroom. They plan to purchase two additional horizontal carousel to accommodate the increase in inventory. “Expansion isn’t a problem for us, one of the reasons we bought the system is that it’s scalable and easy to expand as the hospital grows,” says Houk. With the expansion the stockroom plans to run the five horizontal carousels with one order picker, increasing productivity without increasing labor requirements.

As with all major projects, Children’s Hospital Colorado calculated an ROI for the project. “Ultimately, the ROI for the stockroom horizontal carousel system wasn’t only a dollar ROI, we saw it as a patient value investment,” says Hire, “The stockroom is part of the value chain and our main focus to keep the nurse at the bed with the patient ensuring we provide the best patient experience possible, and the horizontal carousels in the stockroom help us do just that.”