Eliminating waste throughout the medical device supply chain
Helping Boston Scientific quantify the impact of digital inventory visibility on planning, sourcing, manufacturing, delivery, and sales
The challenge
Field inventory tracking manifests as a sales problem, but carries implications for the entire supply chain.
The outcome
Every actor in the supply chain understands how inventory tracking saves them time, money, and agony—and knows how to prepare for it.
Next Mile helped Boston Scientific focus an enterprise-wide inventory tracking initiative, spurring buy-in with quantifiable benefits for each member of the supply chain. Jump to the problem (field inventory management), solution (start together), or outcome (low ambiguity, high value).
Field inventory management
Scattered supply, immediate demand
Every day, good medical devices become scrap, being declared obsolete, expired, recalled, or no-longer-compliant by shifting regulations.
Medical devices live in hospitals as consigned inventory, warehoused at the hospital but only purchased when used in a procedure. Tracking inventory and purchases happens in manual cycle counts performed in person by salespeople or inventory specialists. Some inventory exists as trunk stock in sales reps’ cars.
In this world, getting patients and doctors the devices they need when they need them requires heroic effort. Planning new product production takes crystal ball wizardry.
Interventional specialists
As the world leader in specialty interventional medical devices, Boston Scientific knows how scrap affects hospitals, doctors, and patient outcomes. They also knew a digital solution could put devices exactly where they need to be.
Many solutions, one complicated problem
Inventory tracking technology isn’t new. Boston Scientific’s engineers had already tested multiple technical solutions, but choosing an approach required alignment to the business case that had the greatest impact with the least disruption.
It’s a complex choice with cascading consequences. Boston Scientific asked for Next Mile’s guidance in evaluating options alongside the needs of the global supply chain organization.
Start together, think digital
Kicking off with a workshop
To start, Next Mile conducted a two-day workshop that brought multiple representatives of the global supply chain together. Our group had three objectives:
- 1.Compose a collective understanding of the supply chain from planning to sale.
- 2.Decide what data is most valuable to know.
- 3.Describe who benefits from knowing that data when, where, and how.
Despite some groups being new to each other, the Boston Scientific teams established quick cohesion and rapport.
Mapping the supply chain
After introducing the premise and each other, Boston Scientific and Next Mile created the backdrop of the day’s discussion: a step-by-step map of the supply chain. Every expert and department defined their specific area, while senior executives tested the map’s integrity by walking a hypothetical interventional cardiology product through each stage.
Brainstorming the data we want
Next we focused on data classification, fleshing out the types of data that were useful against the types of data technology could realistically deliver. Groups began by arguing for data types based on intuition and expertise, zeroing in on four classes of inventory data that had real utility. Boston Scientific’s engineers had proven that different technologies could make any of these available, but that didn’t make them equally worthwhile.
Finding pains and gains
When you’re knee-deep in a problem and about to start solving it, it helps to step back and calibrate against what matters. To facilitate that, Next Mile directed a breakout exercise focused on pains and gains. Teams identified what would be gained, created, or lost by knowing a given data type at specific moments in their supply chain. Each came up with a shockingly large number of both pains and gains.
Targeting required data
Earlier, participants had argued for multiple data types. We directed each group to choose their top 5 pains and top 5 gains, asked clarifying questions about each, then mapped them to a diagram of the four data types. In a big reveal, our facilitator turned the mobile whiteboard around, and only one data type was a clear and obvious necessity...and we can’t tell you which!
Solution specifics
Inventory tracking—low ambiguity, high value
Quantifying savings
After the workshop, each team got a critical homework assignment: quantify the value of each pain and each gain in terms of potential savings. Equipped with this information, Boston Scientific calculated potential savings with realistic accuracy, far beyond estimated percentages of lost value.
Benefits across the value chain
Boston Scientific started with ideas and proofs of concept and emerged with a unifying picture of what to pursue and why. Now properly focused, Boston Scientific can design solutions that benefit the entire healthcare system:
- >Patients, hospitals and doctors could get devices they need when they need them.
- >Patients, providers, and insurers get lower device costs.
- >Salespeople, planners, sourcers, manufacturers, and delivery teams get the insight necessary to slash waste from beginning to end.
Internally, Boston Scientific’s teams received critical clarification
- >Brought forward the most likely set of benefits to each business team, providing clear goals.
- >Focused the required sensing/instrumentation approach.
- >Clarified future PoC requirements, gave direction to the likely long-term technical solution.
For Next Mile, this project embodies and reflects our raison d'être and our mission: increase value and actionability by reducing ambiguity, while simultaneously fostering digital self-sufficiency.
Zero touch, high impact
Reducing waste lowers device costs for patients on one hand, and placing devices in the right spot at the right time keeps patients healthy on the other.
Supply chain value identified from digital tracking
| Component | Gains identified | Pains alleviated |
|---|---|---|
| Planning | 17 | 19 |
| Sourcing | 7 | 12 |
| Manufacturing | 11 | 28 |
| Delivery | 9 | 15 |
| Total | 44 | 74 |
Total savings opportunity: $classified
Non-invasive IoT for doctors and patients
Decomplicate, activate, motivate
Boston Scientific began knowing how digital could improve inventory operations, but learned how digital should transform their supply chain. Next Mile helped create the clarifying insight needed to narrow the best options for their customers and themselves.
Digital must first do no harm
Today, Boston Scientific is investigating minimally-intrusive options that deliver the data required to empower their entire value chain. As they succeed in improving supply operations, they improve the lives of everyone who needs or may need a medical device.
Next Mile helped, but this is Boston Scientific’s success.
Read about our offerings and typical engagements to see how Next Mile can help you.