Medical equipment project improves delivery cycle time, reduces back orders, and saves $13 million in inventory costs
Medical equipment delivery performance is critical to customers.
When sophisticated medical equipment – such as a CT scanner, X-ray machine or MRI system – is inoperative due to an unavailable part, hospitals are unable to provide the best diagnosis for a patient.
Further, diminished utilization of the equipment affects a hospital's bottom line.
The metric for parts delivery of this Six Sigma project was defined as the time between order receipt and parts delivery.
Prior to the project, the process averaged 12 hours. But when variation was taken into account, the process was failing to meet customers' needs – often by days.
As measured at the 95th percentile (P95) level, delivery time was 102 hours. In other words, 95 percent of deliveries were completed within 102 hours.
This Six Sigma DMAIC project was initiated to improve delivery performance and reduce inventory, resulting in a reduction of back orders by 51 percent and reduced inventory by $13 million.
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