Do More with Less Come to ASCA 2015 to learn how to maximize your supply spend BY CHRIS KLASSEN AND KEN FLAHERTY

Chris Klassen Ken Flaherty

How can conti- nuous improve- ment in supply cost manage- ment improve your facil-

ity’s bottom line? Did you know that supplies make up greater than 30 per- cent of ASC’s annual expenses? Find- ing savings on supplies can be one of the most effective means of improving your ASC’s financial performance. Learn how to use Lean strategies to minimize waste and manage inventory effectively during our presentation “Supplies Optimization—Make Fewer Resources Work Harder for You” at ASCA 2015, May 13–16, at the Orlando World Center Marriott Resort & Convention Center in Orlando, Florida. We will discuss common supplier contracting questions and simplify some of the complex terms and conditions involved. We will talk about how to create velocity within your supply chain by identifying and eliminating waste within processes— waste that spawns complexity and increases both inventory and overhead cost. Reducing variability enables all of the supply chain flow to operate with low levels of inventory. It also enables quality improvement processes to operate without interruptions, which enables continuous cost reductions and quality improvements. Additionally, we will have fun learning about how to minimize variability within a supply chain using proven tools in a group challenge.

Contracting for supplies can be

frustrating, and contractual terms and conditions can be confusing. In the first part of our presentation we will break down key terms and spend some time talking about ways to determine


the best terms for your facility. We will talk about negotiations and the power of negotiation strategy. Reducing waste is a proven method for reducing supplies expense. The key to effective value management is examining the process that goes through your value chain. A value chain is the full range of activities that businesses go through to bring a product or service to their customers. In order to achieve this we use five Lean continuous improvement principles. 1. Specify value from the stand- point of the end customer by product family.

2. Identify all the steps in the value stream for each product fam- ily, eliminating whenever possible those steps that do not create value.

3. Make the value-creating steps occur in tight sequence so the product will flow smoothly to- ward the customer.

4. As flow is introduced, let cus- tomers pull value from the next upstream activity.

5. As value is specified, value streams are identified, wasted steps are re- moved, and flow and pull are intro- duced, begin the process again and continue it until a state of perfection is reached in which perfect value is created with no waste. The core idea is to maximize customer value while minimizing waste. Simply, lean means creating more value for customers with fewer resources.

For an ASC, it is important to understand how you can look at that value chain, find where the process waste is happening, and then identify the steps to eliminate the waste using the least amount of resources. A pro- cess is susceptible to seven types of waste. So what does that process waste look like within a supply chain? ■

Inventory: Receiving quantity greater than needed

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