Read the cases 7.5 and do business logistics RFID analysis. Address the cost, performance, and schedule for implementation needed to bring the desired supply chain visibility for return on investment.

Case 7.5: Integris's Journey to RFID* Hernias are painfuland not just for patients. With more than 750,000 hernia operations performed annually in the United States, hospitals must stock a large number of hernia mesh patches in various models, sizes, and styles. In most facilities, the inventory and expiration dates of these implants are tracked manually, which can result in costly errors and lost revenue. Nurses often pull multiple hernia meshes from a surgical cart to ensure that a doctor has the correct size on hand in the operating room (OR). It is very common for nurses to forget to return the unused patches to the cart after a procedure's completion. Equally problematic is that the expiration dates of such products are not visible in a hospital's information system. So it may not be discovered that a product is no longer viable until it is too late to return it to the manufacturer for credit. What is more problematic, due to inconsistencies in how data about hernia meshes is manually entered into an OR log, patients could be charged for a different item or not charged for items used during their surgeries. Integris Health, the largest health care provider in Oklahoma, employed RFID technology to overhaul how the organization tracks hernia meshes, thereby reducing the likelihood of expired and missing products and bringing a hard dollar return on investment. But the vision extended beyond tracking hernia meshes. If the pilot test were successful, it was believed it could be the beginning of an enterprise-wide RFID deployment at the provider's network of 13 health care facilities. The pilot test proved the technology works and delivered a return on investment (ROI). Extrapolating the savings realized from tracking hernia meshes to include all products utilized in the Southwest Medical Center's OR, the ROI would be nearly $1 million. It was projected to approach $7 million were the model extended to include Integris's three metro facilities. Integris's enterprise-wide usage of RFID within its facilities will best be accomplished by developing a shared risk and reward program in partnership with groups such as Novation, the purchasing group of the Voluntary Hospitals of America that handles supply buys for more than 400 hospitals around the country. Ideally, suppliers of implants used in hospital procedures would at some point tag their items. While this would entail an additional cost to suppliers, it would in return provide them with valuable information, such as insight into product usage, which could streamline just-in-time inventory programs. The challenge is everyone seeing an added value from the process. Another challenge is to obtain buy-in from the many physicians who work at Integris's facilities but are not Integris employees. This is critical because the hospital cannot mandate that independent doctors wear RFID badges. But if the technology could be leveraged and integrated with existing software to enable the automatic billing of the services doctors deliver to patients directly to their offices (from the hospital's systems), it might make RFID a more attractive proposition for them.