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Ensuring Inventory Accuracy is Stiffest Challenge Facing Today's Linen Managers (Part 1 of 3)

What aspects of inventorying and securing linen pose the biggest challenge for textile care managers like me? With proper controls in place, what percentages of losses (through shrinkage/theft and ragout) do you consider to be acceptable? How can an insufficient linen inventory impact the rest of my operation – labor, equipment, etc.?Healthcare Linen ServicesCindy Molko, RLLDCindy is the director for Linen and Central Services at Mayo Clinic, Rochester, Minn. She is a director for the National Assn. of Institutional Linen Management and a member of its Education Committee. Cindy was NAILM’s 2000 Manager of the Year.
Textile managers dread the call from the customer who says they do not have enough of a certain product. The reasons can vary, but the manager who has a firm handle on their inventory will rarely have to deal with this type of call.
Knowing how much of each commodity is in the system is essential. Annually conducting a physical inventory will provide textile managers with the infor-mation to help them better meet the customers’ needs. Frequently, institutions find inventorying to be a hassle. Inventories that are well done take time to plan. This planning should involve departments that are affected and provide education to help all involved support the process.
Inventorying is a significant challenge for our organization. Due to the size, we rely on assistance from other departments as well as our current textile supplier. A good physical inventory can help determine loss of inventory, support purchasing needs, determine the value of the existing inventory and also determine where excess linen is being stored. The well coordinated, routine inventory of textiles provides the laundry manager with information necessary to maintain an adequate supply for the customer.
A scrub suit is a challenging commodity for our organization. Purchasing is difficult to forecast. It also is one of the most challenging products to inventory. Frequently, the items are kept in lockers or are seen departing the organization with the wearer. It is critical to calculate the loss of such an item to determine product replacement rates. One common solution that a number of organizations use is an automated dispensing unit.
Another method we found effective in controlling the loss of scrub suits was to secure the distribution center. Several years ago, we encountered medical students in our distribution unit. It was discovered they were coming in to help themselves to their “supply” of scrubs. Misinformation from previous medical students was creating a shortage of inventory. As a result, we were fortunate to have the support to begin locking the distribution center.
The unit is considered a secured location in the organization. Individuals must request permission from a linen distribution manager to gain access. Linen distribution staff members have access through their electronic key cards. Reports are prepared routinely that list those individuals with approved access and highlight those who have attempted to gain access to the distribution center.
Insufficient inventory of textiles can impact any laundry manager’s operation. An inadequate par of any product will result in needing to reprocess the item quickly. This has the potential to force overtime for staff, to require operating washers and dryers with smaller loads, and to cause textiles to wear out at a faster rate.
Textile managers should be knowledgeable of the quantity of products needed to support their customers’ needs. This includes knowing the expected product usage, par needed for the specific organization and the addition of a safety measure (our organization uses 10%). One product that we need to monitor continuously is the patient sling (a denier product used with equipment designed to weigh or move a patient). The number of slings used per day, soiling of the product, as well as the circulating inventory all impact whether we experience a shortage.
If the nursing units are in need of the sling, they make a special call to the distribution center. The center determines if the sling is available. If it is not, it contacts the laundry. The laundry must find the product and make arrangements to process/finish it. This may require changing the sequence or schedule for other items that need to be laundered.
Depending on how many times this will occur in a day, this could create delays in other products being returned in a timely manner. If the slings found in the laundry weigh less than the recommended washer’s capacity, this also becomes a less efficient and more costly product to process.
These are just two examples of products that may create challenges for our organization to manage. Each organization has specific products that can create the same type of opportunity. Maintaining adequate inventory and effectively managing that inventory can assist the textile manager in balancing the needs of the customer as well as controlling the overall department expenses.Healthcare Linen ServicesRick Massey, RLLDRick is manager of Linen Services for the Lakeland, Fla., Regional Medical Center. He holds a master’s degree in health administration.
Ensuring the accuracy of an inventory is probably the biggest challenge that managers face. Engaging staff within the organization and impressing upon your own staff the need and importance of linen inventory is the most critical part of the process.
Accurate inventories identify losses from theft and provide purchasing information for maintaining sufficient quantities of each item.
One method I have used to overcome this problem is to have each unit manager draft an inventory representative in advance of the inventory. On inventory day, the reps report to a classroom for a brief in-service session on how to count patient rooms and carts properly, plus they’re served lunch. The inventory forms are then distributed, and the counts are completed and forms returned within about three hours for a 650-bed hospital.
One nationwide database for hospitals has statistics indicating that up to 80% of total inventories are being replaced annually for all reasons, including ragout, wear, damage and theft. There is no truly acceptable or normal percentage of loss due to mysterious disappearance or theft of linen. The lower this percentage, the better your operating costs.
The best way to determine your percentage requires tracking and data entry from inventory to inventory of all linen added to the system and all items ragged out of the system. Because of this involved process, it can be difficult to identify the exact percentage of loss due to actual theft.
If you are located in an area with average security and a large transient population, or in an economically depressed area, losses will be much higher than in a middle-income, resort/tourist area or rural area.
Security can play a large role in reducing loss by reserving the right to inspect belongings, suitcases, backpacks, etc., as people exit the institution. This should be done after discussion and consideration by marketing and public relations.
Another way to reduce loss is to provide an item to serve as a “souvenir” for an area such as obstetrics. A blanket featuring the baby’s name that is given to new mothers leaving the hospital can reduce the taking of “mementos.”
Another important area to consider when identifying losses is emergency services and patient transfers. Does ambulance staff routinely stock its vehicle with linen from your emergency department? Do these services take emergency cases to more than one hospital? If so, your linen is probably at another institution.
When a patient is transferred to another facility or to a nursing home, what are they wearing when they leave? Is it your gown, or are they covered with your blanket? It is sometimes helpful to establish agreements with other laundries and facilities to exchange each other’s property.
Inventory is critical to operating a laundry efficiently. Par levels should be set to provide linen for your operating plan and customer satisfaction. High-usage items should be kept on hand for injection to the inventory “just in time” so no delays are caused in completing the day’s production demand.
Sometimes senior management sees reducing linen purchases as a cost-reduction method, but this is a misconception. Inadequate inventory levels result in less productivity as sorting and production staff wait for regular work, and this can lead to overtime as they struggle to finish the day’s work.
Wash and dry equipment can be underloaded, resulting in lost utility efficiency. Delivery schedules can be disrupted when timed cart deliveries are kept waiting for patient linen items. An item’s life is exhausted more rapidly as it is turned around for immediate use, resulting in further reduction of existing inventories. This cycle leads to higher costs and even greater need for significant inventory purchases than if the system is operated on a planned periodic purchasing plan.
Inventory accuracy and control of losses, while time-consuming, can prevent or help greatly reduce critical inventory shortages. These tasks should be considered an important part of operating your plant in an efficient, cost-effective manner.
 

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