Renoir Case Study & Reference Letter Thomas Jefferson Hospital Usa

2004 © Renoir Consulting Limited

In early 2000, faced with a spiraling supply cost per case, Tom Lewis, President and Chief Executive of Thomas Jefferson University Hospital (TJUH), Philadelphia, had a problem. He was reluctant to get outside assistance, as his experiences with consultants had not always been productive. Being an independent thinker, however, Tom decided to engage the Renoir Corporation, a company that had little experience in healthcare at the time.

Thomas Jefferson University Hospital

THE ASSESSMENT Renoir carried out a three-week survey of the supply chain on two sites (TJUH and Methodist) to understand the issues within the inventory control and distribution systems. It was felt that Methodist would not benefit sufficiently from a project but a comprehensive program was proposed for the main site, TJUH. The proposal identified improvement opportunities in: • Balance sheet inventories • Point of care inventories • Pharmacy inventories • OR inventories A review of the existing MIS was also recommended. FOCUS PROCESS™ & IMPLEMENTATION The selection and training of a TJUH Task Force was a key step in getting buy-in and ownership throughout the hospital. Results from specific areas included: Balance sheet inventories: • 36% reduction • 33% increase in stock turns • 98% all time high order fill rate Point of care (POC) inventories: • Borrowing from the manufacturing sector and developed with the nurses, a KanBan type system was installed to reduce and make more accurate, POC inventories, the results of which prompted a physician to say: "There should be a picture on the wall of whoever has come up with this idea!" Pharmacy: Measurable effects were: • 33% reduction in inventory

• 40% increase in stock turns Operating Rooms: The ambitious aim of standardizing and reducing general medical and surgical supply stocking points was achieved with no adverse effect on patients. OR staff readily took on responsibility and accountability for managing supplies through a highly consultative approach, a big change from previous consulting assignments. As Marie Moody, Supply Technician, OR explained, “This project has completely changed the hospital’s attitude to consultants.” CONCLUSION Project stakeholders were unanimous in their agreement that the project had delivered in excess of its original promise. Sustainable operational improvements from the project include: •Implementation of improved processes to optimize supply chain management for the long term • Implementation of new Management Control Systems to monitor processes, maintain compliance and continue improvements

• Creation of a core culture that understands the importance of managing the supply chain in hospital operations and acts accordingly • Development of taskforce members to carry on and expand

supply chain optimization efforts after project completion

“I am very impressed with what we have been able to accomplish with the dedicated assistance of Renoir. They have delivered on all of the commitments they made in developing the project schedule – often ahead of schedule – and turned around even those most skeptical about the ability of consultants to provide added value.” Tom Lewis, CEO

Key Results Stock down 36% 33-40% increase

in inventory turns 98% (all time high)

order fill rate Creation of a new

core culture

MORE CHANGE.GREATER DEMANDS.INCREASED PRESSURE.

The changes in our healthcare industry continue - more complexity in

technology and available treatment, changes to funding, reimbursement,

mergers and takeovers. Increased patient, physician, customer, regula-

tory and revenue demands. And added pressures from increased supply

chain costs, staff shortages, and competition. Prescriptions for failure or

opportunities for a healthier tomorrow and competitive advantage?

ENGAGING YOUR MOST POTENT ASSETS

A significant strength we have at our disposal in

addressing the issues and challenges that we all

face today, is the dedicated, committed and pro-

fessional workforces that typify the healthcare

sector. Paradoxically, these same people are

often poorly prepared to deal with the commer-

cial requirements that govern the day to day

operational success or failure of today’s health-

care providers and suppliers.

A DIFFERENT APPROACH.

Given the pace and pressure, the need for man-

agement assistance has never been greater and

yet the traditional management consulting

approach of delivering blueprints or prescribed

solutions derived from benchmarks and inter-

views often fails to deliver.

At Renoir, we understand and appreciate the

time constraints and

sensitivities that define

today’s healthcare

industry. We also under-

stand the need for financially sound decisions

involving consultants and the requirement for

predictability and success. Gone, therefore are

the endless interviews, questionable bench-

marks and wish list blue prints. Gone, too, are

the financial risks resulting from consulting

assignments that more often than not, fail to

deliver tangible results.

WHY IT WORKS

A Renoir project works for a number of reasons:

1. Our experiences are not confined to the healthcare industry, giving us

a broader perspective and access to diverse industry solutions, as

well as a critical objectivity.

2. We believe that in order for change to be effective and sustainable,

it must come from within, and we work with staff at all levels to get

buy-in and ownership of change program elements.

3. We always work toward specific, well-defined project objectives

and we commit to delivering them in full at the fee quoted.

4. Our people are selected for their ability to lead your people to desired

outcomes.

5. We are practical:

• IT enhancements are developed to resolve specific

issues, not for the sake of IT.

• If there are labor issues, we have the expertise (and the

common sense) to prepare the workforce before trying

to embark on a change program.

• We believe an organization should improve with

what they have, before buying in new technology.

• We never promise what we can’t deliver.

HOW IT WORKS

It all begins with a low cost Assessment that allows us to define the

opportunities, develop an implementation plan and proposal, and allows

you to see us in action with your people, to demonstrate how the rela-

tionship during a project will work.

A Project brings into play our powerful Focus Process™. This employee

engaging technique not only ensures buy-in and ownership, but also

examines and enhances the connectivity between strategy, vision mis-

sion and goals with day to day execution. Positive changes begin very

early, bringing not only confidence, but financial improvements, as well.

Finally there is an extended AfterCare period to ensure that the improve-

ments achieved are not only sustainable, but actually improve with con-

tinued proactive efforts from your people.

‘We believe that for change to be effective it must come from within’

‘Renoir’s experience in change management wasclearly evident. They displayed keen perceptualskills that allowed them to understand thecomplexities of our organization. Renoir wascommitted to delivering tangible, sustainable resultsin a timely manner. In their time in our institution,Renoir helped put into |place processes andbehaviors that have led to dramatic supply chainimprovements. The Renoir Group exceeded ourexpectations in every way.’

Anne Madden-Rice, Associate Director & ChiefOperating Officer, University of Iowa Hospitals and Clinics

Real solutions for the

healthcare industry

‘Truman MedicalCenters was mostpleased withRenoir’s Assessmentof our Supply ChainFunction. Byimplementing yourfindings, we areprojecting savingsof $300,000 (onetime) and $645,000(annually). Renoirwas also one of thecatalysts for amajor culturechange within theorganization.’

John W. Bluford,President & CEO, Truman MedicalCenters

‘I am very impressedwith what we have

been able toaccomplish with the

dedicated assistanceof Renoir. They have

delivered on all of thecommitments they

made in developingthe project schedule –

often ahead ofschedule – and turnedaround even this most

skeptical about theability of consultants

to provide added value.’

Thomas J. Lewis,President & CEO,

Thomas JeffersonUniversity Hospital

‘One of the greatest attributes that Renoirbrought to the table, was that they taughtthe skills and behaviors required to besuccessful, so that their client can takewhat they learned and apply it to othersupply chain opportunity initiatives.’

Pat Krier, Director, Supply Chain Optimization, UniversityHealthSystem Consortium, Chicago

T H E C A P A C I T Y T O S E ET H E P O W E R T O C H A N G E

T H E C A P A C I T Y T O S E E

T H E P O W E R T O C H A N G E

JO IN THE FAST GROWING L IST OF RENOIR CL IENTS

Wherever you are on the industry’s value chain, Renoir can assist you in improving your organization’s performance.

Whether it’s issues with manufacturing, claims processing, charge capture, supply chain management, distribution chan-

nels, overtime, or operating room programs, our approach engages and enables your "resident" experts to ensure prac-

ticality, achievability, and sustainability, in time frames and dollars that will surprise you.

RENOIR NAMED SOLE SOURCE SUPPL IER TO UHC

Renoir Corporation has signed a three-year agreement with University HealthSystem Consortium (UHC), Oak Brook,

IL, to provide supply chain consulting services to UHC member hospitals and health centers. The agreement took

effect April 21, 2004.

Roberta G. Graham, UHC Senior Vice President, stated that "Renoir is offering UHC members expert supply chain

assessments that will identify and document opportunities for cost reduction and business process improvements.

As part of the assessment, Renoir will create and propose a detailed implementation plan to address these identified

opportunities and will work with the UHC member, at their request, in the implementation of identified opportunities.

Renoir has proven themselves in a number of engagements with UHC members."

THE RENOIR GROUPRenoir is one of the world’s fastest growing consulting groups. Founded as Rembrandt Consulting Ltd in the United

Kingdom in 1994, the Renoir Group now employs more than 100 highly trained consultants and operates through-

out Europe, the USA, south east Asia, and India. The Group also includes a specialist oil and gas consultancy, Renoir

Oil & Gas, and an IT/e-enabling arm, Renoir Technology, offering software/hardware evaluation, systems integration, IT

security, b2b and e-commerce opportunities.

Renoir offers a low risk approach and investment that delivers real results to the bottom line because we plan the achievable.

The solutions we develop produce measurable financial results that have a lasting impact on the competitiveness and

performance of client businesses, because together we develop new systems, processes and behaviours that allow this to happen.

We pride ourselves on delivering every project within the budget originally set and will stay with the project until the origi-

nal objectives are met.

For further information, contact us at [email protected] or visit our website: www.renoirgroup.com

United KingdomRenoir Consulting (UK) Ltd7200 The Quorum, Oxford Business Park, Oxford,Oxfordshire OX4 2JZ

Tel: +44.1865.481446Fax: +44.1865.481546e-mail: [email protected]

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Tel: +1.703.234.7851Fax: +1.703.234.1201e-mail: [email protected]

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Tel: +91.22.2282.1923Fax: +91.22.2282.8477e-mail: [email protected]

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Sep2004 © Renoir Consulting Limited.

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Renoir Case Study & Reference Letter Thomas Jefferson Hospital Usa