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Inventory management may be a basic function for supply chain professionals, but it always helps to learn new tricks to perform better. Healthcare Purchasing Nexos asked a variety oi experts tor sure-fire best practices - beyond the obvious - for successfully managing inventory. Here's what they shared.
Create a mindset that inventory is a hidden cash reserve that should be in your hospital's bank account if it isn't needed to support your operational requirements. A typical 400-bed hospital has $6.5 million, or 7 percent of their total supply spend, tied up in hidden cash reserves in its officia] inventories at any given time. This money can't be used for any other purpose· if it is on your hospital's shelves or in your cabinets. Consequently, we need to educate our department heads and managers that their inventory assets need to Iv thought of as cash on their shelves and cabinets. If stock isn't needed or can be reduced, then let's return this cash to our bank account where it can be readily used to pay salaries, benefits or other hospital operating expenses.
Remember that inventory expands as the space to hold it is made available to store it. I know this truism is accurate since 1 have successfully managed a 168-bed hospital's storeroom inventory out ol three· very small storage closets. I've also visited a client's 350bed hospital where their warehouse was the size of a football field, enabling them to store one-year's worth of inventory on almost even thing the\ bought. V- 1 ounterinluilive as this might seem, your goal shouldn't be to have more storage space at your hospital, but just the precise amount of space to enable you to be operationally efficient with your time, labor and resources - no more or no less!
Inventory turns shouldn't be the only measurement you use to lock down your inventory cost. Traditionally, healthcare organizations only use one measure tor their inventory performance - inventory turns. While this metric is a good rule of thumb to measure vour inven to it efficiency, it can be misleading. Our clients have found that it is helpful to have more than one measurement to help them triangulate their ideal inventory levels. The second inventors' measurement they employ is percentage...