July 29, 2017
The story of loopstock starts at WATTx - a venture builder that is focused on shaping new and evolving industries by creating user-centric, deep technologies. At WATTx, we identify specific problematics by conducting exploratory research in fairly broadly defined areas, like “Shipping” or “IoT Security.” loopstock started out as an “IoT for hospitals” topic area.
After a few weeks of desk research, we identified contacts working in hospitals throughout Europe, including doctors, nurses, administration, and facility managers. We conducted over 18 stakeholder interviews. Our interviews and observations in the hospital environment enabled us to gain deep insights into their routine as well as understand points of friction and frustration during their day.
The key learning from our research: everyone feels like they need to complete several tasks that are not related to the job they are supposed to do. Doctors, for instance, spend around 40% of their time hand-typing patient files and chasing down paperwork from the previous doctors of their patients. Most of the recognized problems seemed to be coming from missing digitalisation in the healthcare sector. Or from a lack of interoperability of installed technical solutions. As a result, nurses spend around 30% of their time doing manual, inventory-related activities and have less time to provide direct care to their patients.
The biggest cost driver for a hospital is their inventory. Around 25% of the total operating costs of an average hospital are inventory related. Over 70% of all hospitals in Europe heavily rely on manual processes to handle their stock. This is not only time consuming but also very error-prone. Around 10% of medicine expires in storage, another 5% of the items go missing and over 7% is not billed to patients (from “Healthcare report strength in unity” by McKinsey, 2014, and “The Pharmaceutical industry in Germany” by GTAI, 2017). Additionally, the procurist or supply chain manager of a hospital or hospital chain does not usually have the transparency he needs to make informed decisions or to support his negotiations with suppliers: “most [clinics] do not have a core database. They do not have complete information about the products they procure or those they have in stock.”
We distilled the most pressing and common problematics and clustered them into what we call problem areas - inventory management being one of those. Ideation sessions, fostered by insights from user research, enabled us to identify vetted solutions that were pitched to WATTx’s rapid evaluation committee. The committee voted to pursue loopstock - the company that will change the way hospitals manage inventory.
At loopstock we’re building an automated inventory management system that gives transparency to the hospital’s material flows and predicts the demand for consumables based on intelligent algorithms.
We use RFID-readers to track tagged inventory and once an item enters or leaves a storage room it is checked in or out of the storage room. This way we know exactly which and how many items are available, as well as their (precise) location. Additionally, we store information, such as expiration dates, so that we can alert the caregivers to use specific items before they expire. All users of the loopstock system get access to an interface specifically tailored to their needs. Nurses can check the status of inventory or deliveries for the storage rooms in their department. Doctors can search for and locate items throughout the hospital. The administration can get transparency from a dashboard that shows relevant KPIs for improving their procurement process.
Removing manual labor (like filling out paper-based order forms and scanning barcodes) greatly increases the efficiency of the caregivers, who can now concentrate on the job they love: caring for their patients. At the same time, purchasing departments can reduce the amount of stock on hand by relying on data rather than guesstimates. Studies show that an average German hospital could save up to €4,5 Million per annum by automating inventory management and leveraging data for procurement.
Right now, we are working on a prototype for RFID-based inventory tracking and about to install a first pilot in a German hospital chain. As we transition out of WATTx, we’re looking for a skilled and motivated CEO with experience in the healthcare sector to join the founding team.
We’re also looking for additional pilot project partners; so if you are interested in discussing inventory management in your own hospital, contact us.
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