MEDICAL IMPLANT COMPANY

Summary

This global leader in musculoskeletal healthcare provides creative and cost-effective solutions that enable orthopedic surgeons and clinics to restore mobility and treat arthritis and traumatic injuries.

Prior to engaging with DHL Supply Chain, the company maintained separate distribution centers (DCs) in the United States for its Reconstructive Products and its Surgical Products divisions. Recognizing the business value of integration, the company selected DHL to consolidate products from the multiple divisions in a single DC. The new facility, which features a customized warehouse management system (WMS), has allowed the manufacturer to accept overnight orders later in the day and expand the number of bundled solutions available.

    • Products to same customer base being distributed through multiple distribution centers
    • Need to accept late orders for next-day shipment
    • Outdated WMS without lot traceability capabilities
    • Newly designed distribution center capable of supporting expanded services
    • Customized WMS with lot traceability
    • Strategically located overnight shipping center
    • Consolidated shipments from multiple DCs for greater efficiency and improved customer service
    • Secured ability to accept next-day orders later in the day
    • Increased number of product kits and services offered
    • Established strong technology foundation

Customer Challenge

Providing replacement joints and instruments to surgeons demands a supply chain that is sophisticated, accurate and responsive. With separate DCs in the Midwest for its Reconstructive Products division, which provides replacement joints and surgical instruments, and its Surgical Products division, which provides gauze, bandages, and other soft goods, the effectiveness of the customer’s supply chain was limited by its inability to combine shipments across the businesses and an outdated WMS.

In addition, the company needed the ability to accept orders for next-day shipments later in the day, and to expand the number of product kits it could offer to customers. While the potential benefits of integration were significant, the integration had to be managed in a way that would not compromise the accuracy and dependability of shipments.

DHL Supply Chain Solution

Key executives were familiar with DHL Supply Chain from their previous roles in other organizations. In addition, DHL has an ongoing relationship with the company in the United Kingdom. As a result, DHL was brought in to develop and execute a plan to integrate distribution across multiple businesses.

DHL established a new warehouse for the customer in the southern United States, capable of serving the needs of several business units and enabling combined shipments. The facility is designed to support multiple customer types and scenarios from packages of replacement joints for hospital consignment to individual products required by surgeons to support trauma response. DHL managed the successful migration of approximately 30,000 SKUs, which support 150,000 unique part lot combinations, from the two existing facilities to the new facility. The new facility was designed to efficiently support special services such as decontamination, kitting and an implant loaner bank.

Critical to the new facility is a customized WMS system that provides lot traceability. Customers can now track their shipments from picking through delivery. The system also supports scanning and auditing of every unit picked to ensure the highest accuracy. DHL associates use customized personal digital assistants to scan products for the implant loaner bank. The visibility provided by the scanners and the existing WMS will enable the customer to implement a web based system that provides field personnel with complete visibility into product movement.

DHL established the new distribution center near an airport in the southern United States, which allows the customer to expedite overnight shipments.

Customer Benefits

The integration of product distribution across the manufacturer’s multiple businesses has increased shipping efficiency and enhanced customer service.

More importantly, the company can now accept orders for same-day shipment six hours later than it could prior to the integration. This significantly increases the company’s flexibility to support its customers as they respond to unpredictable patient needs.

Kitting, which was previously performed in the field at multiple locations, is now centralized in the new DC to improve efficiency, create greater standardization and streamline the development of custom kits for specific customers. The new DC was also designed to support new services, including centralized decontamination and instrument/implant consolidation.

Plus, with the new WMS, the company now has the technology foundation to enable better management of product distribution and to offer visibility into product movement to field personnel across the organization.

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