Many small and large IDNs are considering use of Integrated/Consolidated Service Center (ISC/CSC) to improve service levels and reduce distribution related costs. One of the first steps in determining whether or not it is feasible to use such approach, our consultants have performed several such feasibility studies to help with decision support for our clients. Based on the scope of work, here is a list of questions that executive management is seeking answers to:

• What are the key drivers in determining feasibility of a service center?
• What are key risks in undertaking self-distribution specific to our organization?
• What are qualitative and quantitative factors leading to a best case scenario and worst case scenario?
• What is a timeline for such a transition given the current conditions?
• How to put together a detailed proforma and project plan for a sound decision support?
• Is Low unit of measure (LUM) picking or JIT the right strategy for our organization?
• What can we learn from some of the other ISC operations that are already installed?
• Where to find the right resources to coach and train the hospital supply chain management staff to improve productivity as part of self-distribution strategy?
• How to determine sizing of the new distribution facility along with staffing and IT needs?
• What additional services should be considered out of new service center to maximize benefits?
• Should we consider servicing other facilities outside of our organization?

Here are some key ancillary services for consideration while designing a service center (ISC/CSC):

• Case Cart picking
• Sterile Processing
• Centralized Pharmacy
• Physician Preference Supplies
• Laundry & Linen Distribution
• Sanitary Supplies
• Office Supplies
• Document Storage and Retrieval

Upon review and approval of business case from the executive team and/or board of directors, next step in life of Integrated/Consolidated Service Center (ISC/CSC) is to start implementation planning. Our consultants have comprehensive experience in complete design and implementation of new service center. Here is a list of initiatives typically involved with such plan:

• Complete project planning and timeline
• Resource planning and detailed budget for: Capital & Real Estate; Management; Labor; Equipment; Technology
• Functional programming & detailed facility design including CAD drawings
• Process design for each function
• Hiring and Training of Staff
• Design of Key Performance Indicators
• Transportation Planning
• Inventory Planning
• Shift Planning
• Rollout planning and communications with each hospital coming on board
• Change management as it relates to each hospital coming on board

Many organizations are considering outsourcing of service center operations using a 3PL provider. Our consultants have experience working for 3PL organizations and therefore have clear knowledge of how to pick a best service provider for your needs. Based on the
scope of work, here is a list of questions that executive management is seeking answers for:

• What are the capital needs required up front to launch an outsourced ISC operation?
• How to select short list of vendors for consideration?
• How to prepare comprehensive RFI and RFP documents to ensure all providers understand the requirements?
• How to evaluate short list of vendors as finalist using objective evaluation criteria?
• How to assess risks associated with outsourcing the logistics operation?
• How to draft a service level agreement (SLA) to ensure expectations management with a vendor?
• How to create a detailed contingency plan for insourcing the operation in case vendor is not performing at a desired performance level?
• How to create a comprehensive disaster planning strategy?
• What technology should be owned by the owner versus the vendor?

In some instances, the hospital organizations or IDNs realize that the service center is not performing at the desired level. This is typically the case when the financial performance is behind schedule. Our consultants understand both financial models related to ISC operations as well as the logistics performance. As part of our assessment, here is a list of questions that we can answer:

• What are the key cost drivers leading to lower performance?
• What are service factors leading to lower performance?
• How to reengineer processes to improve operational performance?
• How to evaluate short term and long term opportunities for improvement?
• What technology changes may be warranted to improve performance?
• What are new retraining needs to improve performance?
• What steps are necessary to improve sourcing and purchasing to improve financial performance?
• Is there a need for re-slotting or re-layout of the warehouse to improve functional performance?
• How to evaluate standardization opportunities to improve financial performance?

Our assessment report will have clear guidelines and plan to improve financial and service performance of the service center.

As part of implementation support for Integrated/Consolidated Service Center (ISC/CSC), it is crucial to have a clear understanding of what is expected from the service center and what is expected from the hospital customers. This is one of the most important steps in the life of ISC operation that is often ignored by many organizations. Unless there is a clear understanding of expectations, many operations experience service issues that are imminent especially from hospital viewpoint. Our consultants have comprehensive experience in drafting such agreements.