Effects of barcodes within healthcare supply chain management
In the history of innovation, much progress has been made by successful applications being adapted from one sector to another. The aerospace and automotive industries, for example, routinely introduce new technologies that were first tested in space, or Formula One.
The health sector is no different, where the NHS is currently applying a practice tried and tested for many years in sectors as diverse as retail, manufacturing and distribution. I’m talking about supply chain management, which is helping to save patients’ lives and realise huge cost savings in our cash-strapped health service.
It all starts with the humble barcode – a technology developed back in 1974. As any large manufacturing or retail company will tell you, barcoding plays a critical key part in effective inventory and supply chain management, enabling them to track and trace stock as it moves through complex logistical chains.
Up until recently, the NHS made little or no use of this track and trace principle, resulting in many Trusts having only a vague idea of the stock they hold. This could be anything from a common swab to a high-tech electronic implant. The result was vast amounts of waste, often resulting in over-purchased stock going out of date, or, more dangerously, stock not being available when needed.
Launched in 2016 the Department of Health’s Scan4Safety initiative is a major new initiative designed to tackle this. At its core, it is testing how barcoding can help acute trusts track and trace their medical supplies, from the point of receipt to the patient.
So far, the results are impressive. With tests now underway in six NHS Trusts, expectations about the savings that the initiative could deliver over a seven-year period have been increased from £800mn to £1bn.
But it’s not just about saving money. Scan4Safety, which sees barcodes placed on everything from breast implants to screws on knee replacements, aims to avoid a repetition of the 2010 PIP breast implant scandal, where poor record keeping made it difficult to track down some of the 50,000 British women who had received faulty breast implants.
As one of the companies whose technology is involved in the Scan4Safety trials, Genesis Automation has obtained first hand insight into some of the objectives the NHS hopes to achieve by using supply chain management technology. And we are also seeing some of the impressive results.
So, what are the main benefits NHS Trusts can expect?
1. Improved stock visibility and cutting waste
The recent story about the NHS being charged £1,500 for a £2 pot of moisturiser highlights the challenges facing NHS procurement and inventory management. The Carter Review estimated that better buying practices could save the NHS over £1bn.
One of the aims of the pilots is to explore whether barcoding all equipment, drugs and supplies makes it easier to simplify purchasing decisions and eliminate over-ordering by delivering a much clearer picture of what stock is available, including which drugs are nearing their expiry date and need to be used up. It is also expected that inventory management can highlight variations in prices paid for stock. Barcode enabled stock visibility especially around supplies used in theatres, harnessed to automatic re-ordering systems, should also mean Trusts can be more confident that essential equipment and drugs are available when needed, helping to avoid operations being cancelled unnecessarily.
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2. Reducing disparities in cost and quality of care
With The Carter Review uncovering a 20% variation in the cost in inpatient care between the most and least expensive hospital trusts, it’s not surprising that the NHS is on a mission to drive down disparities in costs and standards of care between hospitals and Trusts.
From this financial year, patient-level costing for the acute sector is set to become mandatory. Yet reducing disparities in cost and quality of care is impossible without accurate tracking and tracing of all items, equipment and even personnel involved with a patient during their stay.
From the minute a patient receives treatment, to the moment they leave hospital, barcode technology can identify and quantify exactly which medicines, equipment, food, bed linen and personnel were used in or involved with their care.
As the trials are finding out, this data has the potential to be used to deliver accurate costings at patient level as well as highlighting discrepancies in cost between hospitals/departments/shifts and even doctors.
Meanwhile, as trusts’ ability to track which inventory, procedures and professionals have been used for each patient improves, the resulting intelligence should enable new insights into how to eliminate unacceptable variations in standards of patient care. In the longer term this should result in much better outcomes for patients.
3. Improved safety and compliance
As we have seen, improved safety is a key focus of the Scan4Safety initiative. While product recalls are rare, currently an average of one patient a week in the UK dies a week due to being given the wrong medicine.
The use of barcode technology, with drugs and implants scanned and matched to patients, will make it much easier to ensure that patients are receiving exactly what they should be, making these tragic and avoidable errors a thing of the past.
4. Automating manual supply chain tasks
Using automated inventory management systems should mean that valuable hours which nurses and hospital admin staff currently spend manually re-ordering equipment and supplies are freed up to be reinvested in patient care or training. An estimated 4,000 nursing hours are spent each year on these manual supply chain duties – precious time that can go back into hands-on patient care.
The roll-out of inventory management technology in the NHS is still at an early stage and in many hospitals has been limited to trial areas – such as orthopaedics departments. From close observation of the trials, it’s clear that supply chain management technology is already having a radical improvement on cutting waste and costs.
Upgrading RFID and Automated Track and Trace Solutions
During the COVID-19 pandemic, global supply chains faced the challenge of rapidly adjusting their business priorities to new customer preferences. Local supplier backlogs, winter storms, and the Suez Canal backup in March underscored the need for efficiency and visibility across the supply chain.
According to Christof Backhaus, Digital Lead Product Supply and Smart Label Project Lead at Bayer, companies must now place critical importance on tracking and tracing their products. “All large enterprises in the world dealing with finished goods,” he said, “seek functional and technical solutions to real-time channel inventory.”
Indeed, RFID’s real-time tracking data allows executives to make quick, well-informed decisions in moments of supply chain crisis - and rather than unfolding across days or weeks, it only takes a matter of minutes.
Why does RFID remain relevant despite digital disruption?
Essentially, RFID uses radio frequency waves to transfer data wirelessly between a scanner and a tag. In contrast to barcode technology, which requires a stationary scanner, RFID tags can be pinged from anywhere in the world, allowing companies to track real-time movement through the supply chain. RFID tags can also scan unique SKU numbers and distinguish between varying product sizes, colours, and styles: a critical feature for increasingly personalised end-user products.
Though the first patent for RFID tags appeared in 1973, higher accuracy rates, lower costs, and advances in sensor and data technology have made it newly accessible to a wide range of companies. Today, the technology is used in logistics networks, manufacturing and delivery networks in the pharmaceutical industry, and any business where efficiently tracking and monitoring product location is critical: raw materials, consumer products, cars, electronics, retail, and agriculture.
What are the key benefits?
Overall, automated track and trace solutions keep labour costs low, optimise operating costs, mitigate security risks, use capital effectively, and assist companies in adhering to regulatory requirements.
Below are three in-depth dives into how RFID benefits major industries:
- Pharmaceuticals: RFID tags help manufacturers safeguard sensitive products such as vaccines, tracking where they are and when they will arrive in real-time. Sensors closely monitor temperatures to ensure regulatory compliance. If anyone tampers with a shipment, the sensors alert the company.
- Logistics: RFID identifies process gaps and frequent anomalies by monitoring a product’s lifecycle from shipment to delivery. This data helps decision-makers predict the most efficient routes and therefore optimise their distribution schedules.
- Retail: Sensors help guard shipments against theft and provide critical intelligence when shipments go missing. Before adopting RFID technology in 2203, UK retailer Marks and Spencer relied on barcodes to scan inventory. When they made the switch, their productivity increased from a maximum of 400-600 items scanned per hour to up to 15,000 items scanned per hour. Building on their initial success, the retailer expanded the use of the technology and is still using it today.
Regardless of the industry, RFID promotes accuracy, immediacy, and efficiency. Companies reduce human error by automatically scanning products, keep track of inventory even in geographic locations with poor connectivity, and help streamline warehouse operations by identifying exact product locations.
Which recent innovations have changed the game?
With recent developments in cloud technology and IoT, a multitude of cloud-based alternatives have emerged to challenge traditional RFID technology. One of these cutting-edge solutions is Sony’s Smart Label - an intelligent shipping label that runs on AT&T’s global cellular network.
As with any good innovation, Sony’s proprietary technology started with a customer need ready to be solved: the Bayer Crop Science Division lacked an international IoT solution that could track seed products from start to finish throughout its distribution channel. Millions of dollars of revenue stood at stake, so Bayer turned to Sony to develop a smart label that would set the organisation up to manage its supply chain with end-to-end visibility.
Sony’s printable and disposable adhesive label allows companies to track the condition and location of their products worldwide and act upon the vast amounts of data it collects. The process is simple: the label activates when attached to the package, connects to AT&T’s secure LTE-M network, and sends data to the Smart Label Cloud in real time.
In sharp contrast to other smart label solutions that place trust in a patchwork combination of Wi-Fi, radio-frequency identification, and other limited coverage connections, the Sony Smart Label connects solely through a secure and universally-available cellular network. “Working with Sony,” says Robert Boyanovsky, the vice president of Mobility, IoT and 5G at AT&T, “we provide full visibility of every item shipped.”
Most importantly for companies on the edge, the Smart Label integrates with existing enterprise systems to achieve full visibility, thus adding value without disrupting supply chain process flow.
Why is this important now?
Companies that previously delayed introducing RFID and other automated track-and-trace technologies can capitalise on recent developments that lower costs, improve accuracy, and supercharge traceability.
Clearly the technology has value in today’s uncertain global marketplace, and can help decrease the costs of tracking goods. To quote Christof Backhaus, the Project Lead at Bayer, “the Smart Label indicates how much product is in the market, from the packaging line to the end customer.” Companies no longer have to spend a small fortune to take advantage of recent IoT developments. “Due to the technical composition [of the label],” Backhaus explains, “we don’t require additional infrastructure, manual scanning, or other expensive tools.”
Over the decades since RFID was first introduced, support for introducing it to company supply chains has also improved. AT&T’s IoT Professional Services Organisation, for example, supports companies through the end-to-end design and integration process--from installation to deployment and project management.
Companies that invest in traceable and visible supply chain solutions stand the best chance of survival, adjusting in real-time to natural disasters, shipping backups, and slowed-down supplier turnarounds as a result of the global pandemic. “Smart Label promises to help businesses like Bayer realise the full potential of the IoT,” says AT&T’s Boyanovsky. “[We can] deliver improvements in revenue and cost savings and make supply chains more efficient.”
Certainly, company executives will be hard-pressed to ignore recent innovations. In an age of uncertainty, RFID and its challengers herald a welcome sense of supply chain security. The next step? “Our sales team,” Boyanovsky adds, “is prepared to engage with prospective customers now.”