Lean Six Sigma Review of Stores Management Process

Identified annual savings of c. £400k per annum as a result of improvements to the Stores Management process for an NHS Trust

How we helped...

Continuous Improvement Projects Ltd were asked to carry out a 10 Day Lean Six Sigma review of the stores process, including purchasing and inventory management, on behalf of a large London-based NHS Trust. An internal audit was carried out within the organisation that identified a number of risks and issues that concluded that there was limited assurance relating to the management of stores. There was an inefficient stock inventory and purchasing process with a high amount of waste, and poor financial control that did not demonstrate Value for Money (VFM). The review identified a number issues relating to how the stores were managed and recommended a process review and redesign.

We carried out a Voice of the Customer survey to understand feedback and requirements from Customers of the stores process, i.e. the individuals who purchase or use the stock. We categorised the feedback into common themes: lack of standardisation, significant process delays, purchasing system challenges, and lack of consistency of both the process and roles and responsibilities between the teams. We facilitated a workshop with a variety of key stakeholders to map the “as-is” process and captured estimations of process timings which was then plotted into a Value Stream Map. This activity identified significant variation in the process cycle time dependant on whether stock had to be purchased and the delivery time of this. We found that 99% of the total process time was delay time, and 95% of the total process time specifically was “waiting”. Within this workshop and subsequent meetings, the feedback was analysed further to identify the root cause of the problems. To provide further context and supporting evidence, we also visited the sites and storerooms in particular, and held meetings with the stores staff to understand some of the challenges. Photos from the site visits were included within a storyboard to the Leadership team to provide supporting evidence of observations and further recommendations. We carried out a 5S review on the stores and provided a copy of the completed checklist and also a blank version of the template to the stores staff so that they could continue to carry out the review on a regular basis, identifying areas for improvement and implementing corrective actions on an ongoing basis. There were concerns regarding the system functionality to enable effective inventory management, and so we carried out gap analysis between the functional requirements and system capabilities, which flagged that there was not a significant gap between the two – albeit there are more advanced systems for stock control in the market.

Further external considerations were identified and flagged within the review including adjacent processes that would need to be considered alongside the new solutions, limitations with the purchasing system and a review elsewhere in the business that should not be carried out in isolation.

Following from the as-is review, we identified a number of short, medium and long term recommendations that could be implemented. The short and medium term recommendations resulted in a conservative estimated annual saving of £272k per annum cost reduction and a further £39k per annum of process reduction time. Details of the cost saving calculations were provided as part of the review, with demonstrable examples including reduction in annual spend on stock, reduction in stock price variation, reduction in approvals and duplicated purchasing activities. The long term recommendations provided further estimated annual savings of over £100k per annum through implementation of automated stock control, reduction of over-purchasing and alternative solutions to stock control. Upon completion of the review, we also included a proposed “to-be” process, and implementation roadmap so that the client could easily implement the solutions provided.

Read more about our Service Packages here.


Read more Case Studies here…

Lean Six Sigma Training at Bouygues Energies & Services

Delivered Lean Six Sigma training across several operating units, covering all levels from graduates to senior leadership, equipping their staff with the tools, principles and methods to drive continuous improvement in-house. Read More..

Portfolio Management Tool Implementation at Johnson Matthey

Led the global implementation of a Project and Portfolio Management tool across a £1m+ Capital Projects Portfolio, allowing for precision measurement and continued growth. Read More..

Service Relocation & Improvement at London School of Economics

Relocated core operational activities from New York to London and repackaged the portfolio of services, improving the process cycle time by 20% and the overall customer experience. Read More..

Pin It on Pinterest

Share This