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Arnold Palmer

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Arnold Palmer

Case Overview:

Arnold Palmer Hospital specializes in the treatment of women and children, and is renowned for providing one of the highest quality medical services and records of high patient satisfaction. This, however, requires costly inventory, most notably of custom surgical packs. In line with this, the hospital tied up with a major distributor partner, McKesson General Medical, which provides them with one-quarter of their medical/surgical inventory. This reduces their expenditures and helps them keep the quality of their inventory just in time for the scheduled operations that need them.

Case Analysis:

The hospital has managed to form a JIT partnership with one of its major supplier, McKesson General Medical. To ensure coordinated daily delivery of inventory, McKesson has placed a full time account executive and two service personnel to the hospital. This has reduced daily in-house inventory from 400,000 to 114,000.

Arnold Palmer and Mckesson has designed a system for custom surgical packs. A packing company assembles the customs packs with the order requirements of McKesson. The surgical packs are packed in a way that each item comes out of the pack in the sequence it is needed. Problems may arise if the items are not in order when opened for operations. The hospital has 10 custom packs being used in the system. Surgical Staff of the hospital work with the hospital to identify and standardize and reduce the number of custom packs.

Recommendation:

One of the problems with the system for custom surgical packs is that the packing company which assembles them is different from the one who manufactures them. This poses a problem in case there are misunderstandings about the orders between these two key players in the delivery. To solve this, the Hospital should ensure that there is mutual understanding between the

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