Supply Chain Efficiency: Go Beyond Two-Bin Kanban

Wendy Werblin, Director of Industry Solutions

August 9, 2016

I recently attended the Association for Healthcare Resource and Materials Management (AHRMM) conference to hear what's on the mind of hospital supply chain management leaders.

Hospital supply chain

I listened to supply chain leaders talk about their struggle to keep up with cost cutting efforts, clinician preference, and staff that hoards supplies. These leaders are navigating the many new technologies designed to address these problems while trying to make sure that the right items are available in the right place at the right time, whether that item is a bottle of lotion or a high-cost implant.

Many of the solutions presented at the conference talked about using LEAN principles and involving clinicians in the solutions; for example, letting nurses define what items are named in IT systems.

Two-Bin Kanban systems were often discussed as a solution to inventory management and to reduce the number of times items are out-of-stock. A Two-Bin Kanban system is an approach where there are two containers of inventory. When the first container is empty this signals that it is time to replenish the supply. The system relies on a defined timeline for using up the contents of the second bin and coordinating the replenishment process to have the empty bin refilled before the second bin is emptied.

The Two-Bin Kanban system is successfully used in many industries, but does it work for healthcare? In a hospital, when a bin is empty it is typically placed on a high shelf in a supply room. Supply staff make rounds throughout the building several times each day with a cart of supplies, looking for empty bins to restock. There is little visibility of what needs restocking until the supply technician arrives at a given supply room – if they don’t have what’s needed, it means a trip back to the basement to get it.

Impinj partner VUEMED who works with Beth Israel Deaconess Hospital (BID) in Boston revealed the complexity in hospital supply chains that makes a Kanban approach more challenging . BID has implemented VUEMED's VueTrackRF system that uses RAIN RFID technology to monitor and track high-value supplies coming in to the hospital and to identify when they are taken from the supply room.  By combining Kanban principles with RAIN RFID technology BID has been able to achieve real benefits that wouldn't be measured by LEAN and Kanban principals alone.

BID’s primarily goal was to limit expired product by making sure that the oldest products were used first and flagging expiring or expired items. They also needed to limit overstocking of key, high-value products like implants and catheters. And, they wanted a hands-free system that could use the existing storage areas they had and not require purchasing anything new, such as an enclosed cabinet.

BID worked with their suppliers to tag items at distribution centers so they arrive ready to manage in the VueTrackRF system. VueTrackRF keeps track of UDI-compliant item information such as expiration date so that supply technicians and clinical staff have visibility into which items to use first. The system also connects to the BID patient records system so that the patient can be charged automatically – and accurately – without any barcode scanning.

With this solution, BID now knows when items enter inventory and are used or returned. They can manage inventory PAR levels based off highly accurate data about use. Staff doesn't feel like they need to keep "extra" supplies on hand because the workflow enabled by VueTrackRF means that products are always stocked. And they have reduced inventory carrying cost and increased revenue.

BID has seen significant savings since deploying this hands-free supply system that employs automation to go beyond the traditional Two-Bin Kanban system. Read more about the VUEMED and Impinj solution.

For more information on how you can build your own RAIN RFID solution, talk to an expert about your application.


Impinj (NASDAQ: PI) wirelessly connects billions of everyday items such as apparel, medical supplies, and automobile parts to consumer and business applications such as inventory management, patient safety, and asset tracking. The Impinj platform uses RAIN RFID to deliver timely information about these items to the digital world, thereby enabling the Internet of Things.

© 2012 - 2019 Impinj, Inc. All rights reserved.,