For clinical labs, smarter can trump bigger

Jim Kendrick, COO, SilverStaff Clinical Laboratories Inc.

Discover how logistics helps a smaller testing lab compete head to head with the big players.

It's true for every industry. The faster you can innovate and produce, the greater your market share. And the clinical laboratory field is no different.

The faster you can innovate and produce, the greater your market share.

The increasing number of labs able to quickly process high volumes of specimens is creating competition in the market, and pressuring competitors to look for new business strategies – and opportunities.

In clinical testing, timing is crucial. Most of the big players use couriers to pick up specimens from doctors' offices and rush them to the lab to get a jump on processing. Physicians therefore can receive results earlier, providing them ample time to review findings the next morning and plan appropriate treatment with their patients that same day.

But many labs increasingly rely on shipping services to get specimens from the point of care to the point of testing. For labs that serve rural areas especially, a next-day shipping service may be the only reasonable option, allowing the investment in courier services to be avoided.

For many experienced executives in the industry, letting go of the concept of couriers is difficult. Old habits die hard. But scheduling couriers every day is time-consuming and unproductive work. Today, there's simply no need to manage your own logistics.

Turning challenges into opportunities

It may sound simple to change your logistics provider, but the executives who make such decisions are effectively putting their reputations on the line. And UPS understands this. Jim Kendrick, COO of MyGenetx (formerly SilverStaff Clinical Laboratories), had to be sure he could surmount two crucial business challenges when he made his choice. First, he needed to know in advance how many specimens the lab would receive the next day so that he could staff up or down accordingly, and, second, he needed a way to get specimens to the lab earlier.

When UPS Account Manager Matt Morgan first sat down with Kendrick, he found that MyGenetx's physician clients were shipping samples using handwritten waybills.

"Though this traditional method of creating a shipment is effective, such shipments don't have a UPS smart code, and consequently, they can't provide tracking data to either the sender or the consignee," Morgan explains.

Mapping the supply chain

A thorough supply chain mapping analysis of MyGenetx's logistics revealed that a combination of services from UPS's broad portfolio would suit MyGenetx's unique needs, solve its challenges and provide a basis to accelerate the business.

The solution, Morgan explains, is for doctors to use a preprinted "peel and stick" UPS shipping label on the outbound MyGenetx package. "Now, the physician's staff no longer needs to create a shipment using waybills. They just peel, stick and ship, and the package data enters the UPS system when the driver scans the package at pickup," he says.

That means Kendrick's staff can use a UPS web-based tool called Quantum View Manage® to monitor inbound and outbound shipments, providing MyGenetx accurate information about inbound packages. Now, he can know in advance the number of staff – and with which skill sets – he's going to need the following day.

Plus, by including a reference number on the peel, stick and ship labels, he can even see which physicians have shipped packages to the lab that day.

Total visibility, end-to-end

In shipping, the unexpected sometimes happens: UPS can't control the weather. But now, Kendrick's staff can see whether any packages have become delayed. And, when these rare events occur, Kendrick knows he's in capable hands.

"When you have a problem, we've found how well UPS is prepared to provide service, which is a differentiator [from other shippers]," says Kendrick. "Often they know of a problem before we do and address it."

The COO quickly saw the advantages of the new arrangement. "Physicians prefer the peel and stick labels because they are simple to use and save time. It's a great selling point for our services," he says.

MyGenetx also began to use, at UPS's suggestion, distinctive packages that can be readily identified. Staff can now easily identify MyGenetx packages as they arrive, remove them from the regular package conveyers, and load them onto the early-morning delivery vehicle.

"We can now offer physicians the same time window to receive test results [as bigger labs can]," says Kendrick. "With UPS Next Day Air® and the accelerated delivery process we can meet the time frame that lets us match the capabilities of the bigger labs."

A challenge became an opportunity – and has transformed MyGenetx's business. In 2011, MyGenetx was processing up to 1,500 tests a week. Now its more than 20 locations receive and process close to 10,000 specimens in the same time period.

"Our goal is to level the playing field with the big competitors," says Kendrick. "UPS provides just what we need and brings in the right people and solutions to make things happen."


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