Efficiency in organisations

by Business Case Studies on Sunday 13th November, 2011

Aldi Logo

Aldi

The NHS is having to make difficult decisions across England which are affecting individual hospitals and services. For example, the trust which runs Leicester’s three hospitals had overspent budget by 8 million pounds sterling in July 2011. Since then, the deficit has gone up to 13 million pounds sterling. Like everywhere in the NHS, staff are having to find ways of working more efficiently in order to provide the same or improved services at reduced costs.

Leicester has taken the decision to close operating theatres, reducing from 46 to 36 over the next three years. The first theatre closed in October. However, incredibly, this has not resulted in fewer operations being performed because surgery now starts on time. The nursing leader behind the project, Elaine Ryan, explained, ‘Everybody used to have a different view on what the start time should be. Now we send for all the patients at 8.00am for the first list at 8.30am and we send for the afternoon patients at 1.00pm for a 1.30pm start.’

Another innovation has been DOSA – the Day of Surgery Admissions area. This is a room with individual bays, where patients are brought in a good time before surgery. This has cut delays in waiting for porters to fetch patients and saved valuable operating time. Another saving area has been identified in invoicing. Dr Doug Skehan said, ‘We have discovered that we have to do better in the way we code our activity. It’s as simple as knowing that we send out the right bills. Many of our staff, including doctors and nurses, have not understood the true cost of healthcare as well as they might.’  (BBC, 7 November 2011)

Aldi demonstrates how this approach of looking for efficiencies in all aspects of its service is not only providing great value for money for its customers, but also generating advantage in the highly competitive food retail industry. Aldi uses the principles of lean thinking to influence its whole operations, from the way it deals with its suppliers, to encouraging employees to offer ideas and support for improvements and cost savings. Key initiatives include training staff to be multi-skilled in order to cover a variety of roles and keeping stock focused on fewer varieties of brands but selling more volume. In addition, Aldi’s policy of operating from smaller stores with more limited opening hours than competitors reduces use of energy and lowers salary costs. It also uses ready-to-display cases to reduce staff time on merchandising and increase efficiency of stock handling.

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