When sales reps at Smith & Nephew visit a client, they don't just shake hands -- they scrub up.
The company provides advanced medical devices and surgical implants to about 10,000 U.S. hospitals. Equipped with mobile handheld computers, salespeople -- who are well-versed in anatomy -- join surgeons in the operating room to keep tabs on which medical devices and surgical implants are used during medical procedures. This information is transmitted wirelessly to a mainframe computer at the company's U.S. headquarters in Memphis, Tenn.
Inventory for the given hospital is updated automatically, including reordering surgical kits to replace those used during the surgery. It is the ultimate example of just-in-time inventory. If a surgeon uses an implant kit containing a size 5 knee, an identical kit is immediately reordered and charged to the hospital's account.
When mapping out a strategy to streamline its global supply chain, Smith & Nephew knew it wanted a wireless component to ease the strain on salespeople, who need real-time, online ordering capability to ensure that stock is immediately replenished and future surgeries can be scheduled. They are frequently on the road, and by the time they receive pricing changes and new-product catalogs, the information usually is out of date. Relying on paper documents to manage and update inventory also meant customer service personnel had to assist them, performing data entry and taking orders from sales reps over the phone.
"There are a lot of management tasks for our sales reps -- making sure they know what was used during surgery, recording it, and reordering it. We wanted to give them something to make it easier to capture that information and get it into our system to replenish stock," says Dennis Burling, vice president of customer service.
The company is turning to the Web and wireless technologies to winnow inefficiencies from its order and delivery processes. Smith & Nephew runs about 40 operation service centers in the U.S. that move implants and instruments to hospitals as they are needed. On average, each service center manages 350 to 500 different "loaner kits" consisting of implants and other surgical supplies. The company recently installed a Web-based inventory system that connects all service centers.
Smith & Nephew equipped some of its sales reps with Hewlett-Packard's iPAQ handheld devices, which run PocketPC software by Microsoft Corp. The software enables the iPAQ to function like a laptop, with access to Outlook e-mail, calendaring, and other features associated with the Windows suite.
Functionality was added by NoInk Communications Ltd., of Indianapolis, Ind. Its signature product, known as SalesAccelerator, includes specialized applications geared for use by the medical-device industry. So far, NoInk has installed modules for managing accounts, ordering, and inventory management. Each salesperson's device is customized with specific customer account data, including pricing, contract information and order history.
The devices are leased to salespeople for a monthly fee. Each iPAQ comes equipped with Bluetooth technology as well, with some sales reps making the transition to Bluetooth mobile phone and Bluetooth mobile printers. Sales representatives can use their cell phones as modems to provide information to Smith & Nephew's enterprise resource planning system, by SAP.
The iPAQ devices replaced Palm-based applications previously used by Smith & Nephew. Although useful for transmitting data wirelessly, Burling says the Palm devices had too many drawbacks for a large deployment. For instance, a dial-up modem had to be attached for transmitting account information. Because of different call patterns of the different hospitals, salespeople were constantly reconfiguring the devices to match the different call patterns of the different hospitals. Its memory capacity was limited.
Smith & Nephew is following a growing trend. According to AMR Research, sales force automation is one of the more popular mobile enterprise computing applications. The Boston-based research firm says 33% of enterprises plan to roll out sales force automation deployment within the next year.
Even though NoInk's product is tailored for the medical device industry, getting Smith & Nephew to change products required some persuasion. "We had to convince them about our product," says Dustin Sapp, one of NoInk's co-founders.
Apparently, though, the product switch apparently is paying dividends. Smith & Nephew reports that calls for price checks from sales reps dropped 5%, while calls and faxes for order entry fell 20%. The automation also is helping the sales force spend less time worrying about paperwork and more time serving clients, says Burling.
End users reluctant
The company initiated a 180-day pilot program in 2002. Two 90-day trial periods this year made the technology available to about 50 sales reps. So far, though, only about 60% of its sales force has adopted the mobile technology. As the company adds functionality, Burling says more end users should see the value behind the company's mobile deployment.
AMR Research notes that 67% of sales force automation deployments suffer from end-user adoption challenges, frequently associated with small form factors of devices, battery power and life, and wireless coverage.
About the author: Garry Kranz is a freelance business and technology writer in Richmond, Va.
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