Lerch Bates Inc. Building Insight

Global Leaders in Technical Consulting for the Building Industry

The Logistics Labyrinth

I love puzzles. Especially the maze type puzzles. You know the ones that have endless branches and pathways that lead you into dead ends. I seem to have a natural instinct to visualize the correct path from the start all the way to the finish line. The greater the complexity of the maze, then better the personal challenge.

I felt this way until I visited a client who had a hospital nearing the century mark in age. Like a multi-tentacle monster, the hospital had grown from a central building into a large, multiple armed (building) complex. Trying to insure good horizontal circulation, the owner had linked all buildings with tunnels, sky bridges, covered walkways, connecting corridors or a combination of all of the above.

Hospital expansions had been opportunistic over the years. Meaning; if the hospital had money, then they could find someone to build onto the existing structure. Expansions are typically dictated by the following criteria:

  • Available Funding
  • Available Property
  • Plot Size
  • Building Code Constraints
  • Profitability (operations within the proposed expansion)

Back to my story:

In most hospitals, my client, the Director of Facilities, resides in the back of the hospital on either the ground or basement floor.  I decided to park in the back of the hospital to shorten my walking distance. After entering the facility I found that I was in the wrong building. No big deal!  All I had to do is to follow the horizontal linkages going back to the main hospital. After about fifteen minutes I thought that it probably would have helped if the facility had invested into some better campus wide way finding. But I didn’t care, I love mazes.

After meandering around the campus for another twenty minutes I decided to look for the cafeteria to pick up some bread slices and water.  (I could leave bread crumbs along the way in case I got lost again. The water was to insure that I would not get dehydrated during my long arduous journey). It wasn’t quite that bad, but I did miss my scheduled appointment. I finally cried uncle and call my client asking for some friendly assistance. I gave him my coordinates and within minutes he was escorting me back to his office.

We finally got down to business and the topic was of no surprise. The opportunistic expansion of the hospital over the years had exceeded the capability of the original hospital infrastructures. (Elevator capacity, support services capacities, etc.).  Elevator wait times could be as long as five minutes.  In addition, everything that had to move (food, supplies, linen, waste, pharmaceuticals, etc.) followed long scurrilous routes through the campus. Transport labor costs were high and kept increasing.  All of this while employee and patient satisfaction kept declining.  He asked “What could be done to help alleviate this problem?” This is not an unusual issue faced by long established and successful hospitals.

The answer was simple. The hospital needed a “Master Transport and Circulation” study. This study examines everything that has to move within the hospital and the existing systems assisting in their movement. The study identifies if the needs of the hospital were being met.  In the case of this facility the answer was a resounding “No”. However, once the deficiencies are identified, then a range of solutions can be identified. The range of solutions can include:

  • System / equipment modernization
  • System / equipment additions
  • Changes in operational schedule and hours
  • Architectural alterations
  • A combination of any and all of the above

The most important advice I can give is:

An owner should understand how a proposed expansion will impact the functions of the existing facility.  These issues need to be resolved before the expansion is built and not left until someone complains.  Not everyone loves a puzzle.

Want Greater Success in Life? Become a Better Sales Person.

I have noticed throughout my life that success is tied directly to how good a person can sell.  I first noticed this in my children when they would ask for toys or food when we were out shopping.  I would say “NO.”  First came the temper tantrums, then the crying fits, then the bouts of verbal anger and, finally, the kisses, hugs and “I love you.”  I must say that they were quite quick to learn how to sell their ideas and get what they wanted.  Persistence and change transformed them into successful sales persons (Success at getting what you want).

We all can remember dating when we were teenagers.  This, again, was a process of selling yourself to someone you wanted to date.  The better you were at selling yourself meant the higher the probability of getting the date you wanted.  This is also true of marriage.  The individual who can’t sell the idea of a better life to a potential spouse is bound to be single for the rest of their life.  Continual trial and error will help develop an individuals’ skill to become a successful sales person (Success at getting a date and getting married).

Job hunting meant submitting a resume and hoping for an interview (A resume is a device used to sell yourself to potential employers).  The interview allows you the opportunity to sell yourself to the interviewer.  Like dating, continual trial and error will help you develop the skills necessary to become a successful sales person in front of interviewers (Success at getting a job).

I got my first job and after a short period of time decided that management was the place I wanted to be.  After much work and determination I finally got here.  Know why?  Yes, I became better at selling myself.  Here’s how.  I learned the job responsibilities of the position on the next rung up on the ladder.  I would then assist higher-ups with their job responsibilities until they relied on me week in and week out.  After becoming competent at these duties, I asked management for the higher position when it became open.  I had sold myself to management by doing the job, without being asked.  (Success at getting the position I wanted).

At a certain employment level within a firm you will be working on teams.  These may be project teams, research teams, company committees, etc.  This is when you need to learn how to sell your ideas to a group.  One of the fastest ways to a promotion is to sell your idea to a committee that impacts the bottom line (profitability) of the company you work within.  I now work in a position that compensates me well enough so that I can do the things I want to do when I am not at work (Success to live the way I want too).

I want to remind everyone of this fact.  You may have more knowledge, experience, or longevity than anyone else in your company.  These things don’t mean a thing if you can’t sell yourself and these attributes.

If you think I’m wrong, then sell me on your idea!

Are Healthcare Insurance Costs the Real Problem?

As an operational and design professional, I have provided expertise which enables our healthcare clients to reduce operational costs and improve operational efficiencies. For the past thirty years, and working with hundreds of healthcare clients, I have found that pharmaceutical and medical/surgical supply costs represent a greater percentage of operational expenses than healthcare insurance.

This belief was strengthened after attending a recent healthcare conference. At this national healthcare conference, a well know healthcare speaker noted the current costs associated with hospital operations.  Costs were broken down into several categories and included:

Hospital operational costs, including such areas as:

  • Equipment Lease Costs
  • Supplies Costs (Medication, Med. / Surg. Supplies, etc.)
  • Physician Related Costs
  • Laboratory Testing Related Costs
  • Insurance Costs

This keynote speaker also noted that supplies represented the greatest opportunity to reduce operational healthcare costs and not healthcare insurance. I believe that our government should be challenging the healthcare industry to control supply and not insurance costs.

We should be improving healthcare operational processes in many areas: clinical operations, support service operations, procurement operations, physician practices, vendor relationships, business office procedures, etc.  Improving the economic performance of these areas has more potential than reforming the healthcare insurance industry.

Supply Storage in Healthcare Facilities

Proper supply storage in healthcare facilities help to increase work efficiencies and decrease nursing and materials management workloads.

Supply storage options in Healthcare facilities can include pallet racks, flow racks, standard and wire shelving, horizontal and vertical carousels, specialized wall bins, nurse servers or automated dispensing machines. How do you know which options to use within your facility? The determination of which option to use is easier than you think. First, establish the criteria that will be used to make your decision. We would recommend first to identify the different type of storage locations within your facility. These areas include patient room, decentralized clean utility room, centralized supply room, surgery, emergency, materials management and warehouse. Different supply areas will have different needs and thus require different equipment. (A Supply Chain manager would not put pallet supply racks in a decentralized clean utility room). Build a matrix to indicate which storage options are appropriate for each supply area. Click the link below to see an example of a storage chart matrix.

Supply Storage Chart

Please note that the cells containing a red dot indicate where the storage option is appropriate for that hospital operation.

The second criteria for deciding the appropriate storage option is using a financial analysis model to evaluate the cost impact of alternative under consideration. (An example is evaluating standard shelving, wire shelving, wall bins or automated dispensing machines for central supply rooms.) The financial model would take the following costs into consideration:

  • Labor (Supply Chain Technicians, Nurses, etc.)
  • Restocking
  • Equipment
  • Leasing
  • Inflation
  • Associated Construction
  • Repair and Maintenance

A life cycle costing model will indicate which option has the greatest financial justification. The third, and last, criteria is how flexible is the configuration of the storage option. Some facilities use built-in shelving and bins since these areas will not be remodeled. However, housekeeping becomes more difficult trying to reach under the lowest shelves. In addition, built-in units do not have the ability to adjust shelving up or down. Both of these issues do not arise when using mobile (wheeled) shelving.