Villanova School of Business VSB 1002- Business Dynamics II Pharmacy Service Improvement at CVS (A) Harvard Business School Case

9-605-015 (Rev. October 20 2006! Case Study Assignment Problems arose in almost every part of the fulfillment process, as explained below: Drop Off Staff asked for name, address, birth date, time of pick-up then put script in slotted bo! "sectioned by hours of the day# in slot for one hour earlier than pickup time Potential Drop Off Problem !o one manning drop"off station Data #ntry At each hour$ tech too% scripts from that hour&s slot and entered all re'uired data into pharmacy info system (so no one loo%ed at script until ( hour before pic%up) Info logged in $atient contact info Doctor contact info %hird party payor info & insurance companies, employers Dru' name Dosa'e (umber of doses (umber of refills System performed an automated Drug )tili*ation +evie, )utomated check of script a'ainst all other prescriptions in *VS database for patient lookin' for harmful dru' interactions and appropriateness of dru' for patient 'iven a'e, +ei'ht, 'ender, etc, -ard Stop . fulfillment process cannot proceed until D/0 revie+ed by pharmacist if automated revie+ reveals any potential problems -ard Stop "ood for patient safety -ard Stop Bad for slo+in' do+n process, lo+erin' efficiency Insurance chec% ,as done after D)+-

*heckin' to make sure insurance still valid, script matches dru's on formulary, customer not tryin' to refill too soon, etc, In most cases, script +ould still be filled even if there +as a problem +ith insurance - customer +ould simply be told to pay full amount at pickup, Potential Data #ntry Problems .ech couldn&t read hand,riting on script$ !o refills allo,ed on script (/0)$ D)+ hard stop (120)$ Insurance problems ((30) Production Scripts +ere filled by pharmacy technicians Potential Production Problem Insufficient inventory 4 patient ,ouldn&t find out until pic%"up that drug ,asn&t available 5uality Assurance $harmacist revie+ed each script to make sure it +as filled correctly, 1irst priority is customer safety2 Potential 5uality Assurance Problem !one identified Pic%up Ba's stored in pickup area in alphabetical order until customer came for pickup, Potential Pic%up Problems 6any$ including staff couldn&t find script$ unauthori*ed refill$ script not covered by insurance 4 customer as%ed to pay full price$ script not ready (,aiting for doctor or insurance call"bac% or 'ueue bac%ed"up)- 7orst bet,een 8"3 p-m- 4 long lines of angry customers 4 hard to get staff to ,or% that shift/- 9o, can I. help ,ith streamlining the process at CVS pharmacies: ;et .eams to come up ,ith a solution to problems in fulfillment process %eeping < goals in mind () Doesn&t degrade safety at all 1) Decreases ,aiting time <) Improves customer satisfaction 7hat CVS did to improve fulfillment process () Drop off$ data entry$ insurance chec% 4 all done ,hile customer is present-

Data entry completed at drop-off +hile customer +as still there & made it easier to verify customer insurance information, Insurance check is no+ done +ith customer present, /sed to be they3d 4ust make sure your name, address, and birth date +ere on prescription and let you 'o, )t local *VS, there is a 5ne+6 drop-off +indo+ a+ay from cash re'ister +here pick-ups are done, *lerks enter data into computer +hile you are still there, *VS +as missin' the opportunity to identify and resolve problems early in the process, +hen the customer is still present, /nder old system, no one +ould look at script until 1 hour before pick-up & not enou'h time to resolve any problems, *lerk asks for best number to reach customer in case of a problem, +hich is a chan'e from the past, Staff can also inform customer about insufficient inventory at drop off instead of customer findin' out +hen they come back for pick-up, )utomated 5instock6 check, )lso, bo! that held prescriptions +as replaced by an online 5virtual 7ueue,6 +hich can be displayed on all +orkstations in the pharmacy, Virtual 7ueue tells techs and pharmacist +hat prescriptions to +ork on fillin' ne!t, 1) Production 4 prescription is filled by tech(o chan'e here & techs have al+ays been the ones to fill the prescriptions, <) D)+ and 5A 4 done by pharmacist in single stepD/0 process +as folded into 8uality )ssurance step & D/0 no lon'er part of Data 9ntry, Both D/0 and 8) are done a#ter prescription is filled, D/0 should not be done +hen customer is present don3t +ant customer to 'et the impression that the dru' could be harmful because they mi'ht be less likely to take it, )lso, D/0 is done at pharmacist3s station durin' 8) & more efficient use of pharmacist3s time to check filled prescription for accuracy and deal +ith any problems revealed durin' automated D/0, -o+ever, pharmacists could ar'ue that it makes no sense, and is in fact dan'erous to fill prescription before D/0 is completed, $SI team had to 5sell6 the ne+ process usin' communication efforts that +ere persuasive and effective, )lso, chan'es +ere mandatory, not optional, so team used both hard sell and soft sell techni7ues to +in pharmacists over, %here +ere a total of : elements in the $SI pro'ram that all *VS pharmacies had to adopt & they couldn3t pick and choose amon' the :,

=) Pic%up

;hen there is a problem discovered +ith a script, an )ction (ote is filled out so that staff mannin' $ickup can ade7uately e!plain the problem to the customer, based on +hat the )ction (ote says, Case highlights I.&s principle capabilities • Design • Standardi*ation • 6onitoring Case also points out concerns that changes in process will be resisted by pharmacists$ even though the ne, process changes no responsibilities or rights of pharmacists- .his ,as a top"do,n change that ,as necessary to improve customer service.o drive compliance ,ith change 4 S#. #>P#C.A.IO!S !e, process must • ?e simple • ?e Intuitive • 6a%e sense