Medical device manufacturers must manage loaner kits effectively and efficiently to drive down inventory costs and better support surgeries. Here are four common pitfalls of loaner kit management and how to overcome them.
Tom Williams, Millstone MedicalManaging surgical loaner kits at the highest level can be a huge pain point for medical device manufacturers. Not only is the process of turning loaner kits highly demanding and complex in itself, but it can also easily consume the precious resources of staff hours and free cash. While not a core competency like product development and marketing, loaner kit management is critical to supporting surgeries, meeting demand, and growing a medtech manufacturing business.
Success in loaner kit management is a combination of these four capabilities:
- Knowing exactly where kits and their contents are at all times.
- Ensuring that every kit contains all required SKUs and is fully ready for surgery.
- Having the ability to respond quickly to demand, especially of an urgent nature.
- Maintaining an inventory pool that is neither too small — inhibiting the ability to respond to demand — nor too large, which can trap free cash.
By managing loaner kits effectively and efficiently, device manufacturers can drive down inventory costs and better support surgeries. The process, however, tends to succumb to four common challenges.
Here are the four pitfalls and how to overcome them:
1. Lack of visibility and traceability
Without accurate visibility, manufacturers cannot be confident that they know what product is ready for surgery and where that product might actually be. Is it in the field? If so, who has it? And where?
Traceability can be even more critical for risk mitigation and the assurance it offers, especially when a product has been recalled. Regulatory inspections and requirements for documented evidence of inventory inspections can also spell trouble for manufacturers that can’t trace their loaner kit inventory.
An appropriate tracking system can help medtech manufacturers solve visibility issues and comply with traceability requirements. When each part in a loaner kit is traceable via a lot number, and that traceability translates into visibility, suddenly a manufacturer has a transformative birds-eye view of its inventory landscape. That means manufacturers can quickly and accurately identify where every part is in every kit and, if the kit is in the field, pinpoint who has it.
2. Incomplete precision inspection and replenishment
Consider the downsides of shipping out a kit with a part that doesn’t meet functional requirements. Delays in surgery cause frustration for surgeons and patients, generating friction that can be difficult for manufacturers to overcome.
Precision inspection is a critical part of successful loaner kit management. Yet it should not stop at gross visual checks of the parts. Precision inspection involves examining each part for damage and to determine that it still meets its functional requirements.
The end goal is to ensure that every part in the kit is in its correct location and is 100% ready to perform in surgery exactly as it is intended to.
3. Inefficient processes
The loaner kit process cycle also includes decontamination at the beginning and packout at the end. It’s a demanding and precise process that requires dedicated resources and focus for maximum efficiency.
When staff is also juggling other priorities, process efficiency suffers as workers shift attention to loaner kit management from other needs. When this happens, cycle time can easily balloon and delay response time, which affects the ability to meet demand and support surgeries.
Creating process efficiency involves designing and implementing a repeatable process and ensuring the right labor resources are available. Without dedicated labor, it is difficult to flex and scale with demand as needed, but dedicated labor can also drive up fixed costs. Often, outsourcing offers the right resources at a lower cost.
4. Failing to bring it all together
Without the ability to quickly and efficiently turn precision-inspected and perfectly replenished kits, medical device manufacturers need a larger loaner kit pool, which can siphon off free cash needed to innovate and grow the business. Outsourcing with an expert partner can prove the best investment of resources to create visibility and build efficient, repeatable processes to support demand while preserving free cash.
Striking the right balance is all about having a loaner kit pool of the optimal size — big enough to support demand, not so big that it’s underused — and turning it quickly and precisely. Manufacturers that can turn kits within 24 hours of receipt, provide same-day service and expedited weekend, holiday, and emergency shipments while knowing exactly where every piece is will succeed in loaner kit management.
Tom Williams is general manager of Millstone Medical. He joined the company in 2008 and has managed Millstone’s packaging facility in Fall River, Mass., and loaner kit and distribution facility in Memphis, Tenn. He works closely with customers to develop new service offerings and to enable speed and efficiency to market.
The opinions expressed in this blog post are the author’s only and do not necessarily reflect those of Medical Design and Outsourcing or its employees.