As healthcare workers know well, hospitals require a myriad of supplies for patient care–everything from gloves and syringes to surgical supplies. As health care systems consolidate, they are trending toward self-distribution operations, which allows for greater purchasing power and efficiencies. Northwell Health, New York State’s largest health system, developed a consolidated service center model to streamline product-delivery logistics across its hospitals. The Integrated Distribution Center (IDC) on Long Island, staffed by 67 distribution associates, is an 88,000 square foot facility housing over 2,500 items, many of which are transported daily to each of Northwell’s 22 hospitals.
In late 2016, the IDC faced challenges including lower productivity, high overtime costs, some late deliveries, worker injuries, and strained labor-management relations. Labor and manager leadership met, reviewed IDC performance data, and agreed there was a mutual interest in improving employee performance to ensure the business’s financial viability and membership employment. With prior favorable experience utilizing the LMP’s services within the Northwell Health system, both labor and management endorsed the assignment of an LMP team to facilitate a change management process where data would drive quality improvement, business design and improve employee engagement.
LMP health systems manager Rodney Brown headed the work at IDC, assisted by consultant William Quintana. The LMP first interviewed managers and associates to better understand the IDC’s operational problems from both the labor and management perspective. The team then helped establish two labor-management committees and four process improvement (PI) groups, and trained committee co-leads in meeting facilitation and managers and supervisors in communication skills and interest-based problem solving.
The IDC’s labor-management committees and PI groups set out to identify work-flow inefficiencies. Using stop watches, distribution associates pinpointed process slow-downs, measured loss of productive time and suggested improvements, which were tested using the PDSA (Plan, Do, Study, Act) methodology.
Improvement teams redesigned systems to improve work-flow efficiency, implemented standard operating procedures, and reorganized sections of the warehouse to speed the packing of supplies. Management provided additional training to distribution associates to improve order accuracy and hired an ergonomics expert to teach safe lifting, picking and packing. Additionally, management started providing cash bonuses to associates who met productivity and accuracy targets.
Three staff huddles per shift and one huddle a week with leadership enhanced team effectiveness and communication, allowing staff and management to better manage workflow and to troubleshoot challenges in real time. The work environment at IDC became more improvement-oriented as labor and management relationships improved.
Productivity and on-time delivery rates began rising soon after PI efforts began. By July 2017, average picks per hour, a measure of productivity, surpassed the IDC’s goal of 40 and has remained above goal for ten months (see graph). On-time delivery hit 100% in August 2017. As productivity increased, overtime hours decreased, resulting in substantial cost savings. Moreover, with increased awareness of safety measures, fewer worker injuries occurred, leading to reduced use of sick time.
Worker engagement is critically important in PI work. “Some of the best improvement ideas came from distribution associates,” said Brown. A staff engagement survey shows substantial improvement. In early 2018, IDC achieved the highest possible level of staff engagement (Tier 1), up from the lowest level (Tier 3) in 2016. Empowering workers to be full partners in PI work has also been key to sustaining improvements for nearly a year.
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