Shedding outdated technology is not only improving productivity and efficiency for the California-based company, but also allows for controlled scale and growth, with improved data accuracy and elevated customer satisfaction levels.
Precision Medical Products is growing quickly — adopting cutting-edge technology along the way in order to lower operational costs and gain efficiencies. The Rocklin, California-based distributor of durable medical equipment overhauled its e-commerce website and installed new systems for warehouse management and data analytics.
The company is one of 10 MDM 2019 Digital Innovator Award winners, honoring businesses that have leveraged technology to advance their operational excellence.
Precision Medical Products launched a revamped online store and implemented a new enterprise resource planning system (ERP) in June 2017. Later, Precision Medical Products unified its e-commerce data with financials, customer relationship management (CRM) and order and inventory management. This move eliminated manual data entry for online orders.
Their previous e-commerce website “was outdated and required a lot of duplicate transactions,” says Bruce Capagli, chief operating officer. The new ERP is “a much better product for our customers, a modern look and feel and transactional flow for your everyday e-commerce that everybody is used to using.”
With the new online platform, the product “gets shipped to the patient direct or the rep’s location. It removed a lot of tension and created a lot of efficiency internally and in the field,” Capagli says. “Our internal customers like having a one-stop shop.”
The new e-commerce website performs better on mobile devices than the old one, which is important for sales reps who are often in the field, discussing products with medical providers.
In July 2018, the company implemented a warehouse management system with barcode scanning for its three warehouses. As a result, “productivity and efficiency have greatly increased,” Matt McGinley, chief information officer, says. “Inventory accuracy has increased, as we scan the movement of items through the lifecycle of receiving to shipping. The warehouse management system has also allowed us to enable a system-generated cycle count program, which increases inventory accuracy and reduced the quantity of full physical inventories needed per year.”
The warehouse management system “has been a lifesaver,” Capagli agrees.
Precision Medical Products did not hire more staff to implement or maintain all of the new technology. “We took a team of seven intake people for orders down to 4.5. We saved 2.5. We’ll reduce another 1.5 headcount when we automate our billing process,” Capagli says, with the half accounting for a part-time position. “It’s really done a lot for our business, the ability to scale and grow and allow our sales reps to do what they to best and not have to worry about that other stuff.”
For orders and billing to health insurers, manual entry was too time-consuming and sometimes prone to mistakes. Precision Medical Products built an algorithm to predict what an insurer will pay for a product after receiving a claim. Previously, employees had to comb through workbooks and manually enter what they expected an insurer to pay.
Getting more processes automated and digitized reduced the room for errors in orders, shipments and payments. McGinley says, “The automated system improves our data accuracy. Getting data ready for automation can be a challenge.”
The company uses Looker to track and share some of its business analytics with customizable dashboards. “Our doctors and our surgery centers, we can give them Looker accounts. We can say, ‘We’ll give you full transparency and visibility into what we are doing.’ It’s created a modern-day model of transparency to our customers,” Capagli says.
The technology upgrades have brought big financial gains to Precision Medical Products. Its annual revenue jumped from $17.5 million in 2017 to $28 million in 2018.
Along with increased revenue, there is a need to stay competitive in the industry. “If you don’t have those next-generation tools and artificial intelligence for ordering, you will be left in the dust,” Capagli says. “We wanted to not only catch up to the modern day; we wanted to get ahead.”
For any organization, there’s “always pain in implementing a new system, but the benefits have been amazing. We trained everybody and got them on board — with a little headache early on. There’s resistance to change” at the beginning, Capagli recalls.
To address that, it’s helpful to let employees brainstorm and feel some ownership in the process, so they feel they have done something good for the company, he advises. It’s also wise to promote an internal champion who can convince colleagues that the technological changes will be pretty easy, perhaps by convening an internal advocacy group, he adds.
The healthcare industry tends to change rapidly and constantly, prompting suppliers and distributors to turn to technology to keep up with customer demands and expectations. Capagli did not want to adopt new technology that would be hard to change or replace after a few years of use.
“The big lesson learned is to make sure when we are implementing that we are thinking about the future. I’ve been a part of companies where they’re so stuck in the now or in the past that there’s no thought of tomorrow,” Capagli says.
Founded in 2010, Precision Medical Products has grown to more 130 employees in 31 states. It sells durable medical equipment like braces, boots and crutches, as well as gloves for medical and industrial workers. It processes about 11,000 orders per month, handling prescriptions from doctors’ offices and surgery centers.
Growth has come very fast for this fairly young West Coast business. “It’s a completely different company in the last six months, and we’re proud of it,” Capagli says.
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