Inside the Supply Chain transformation at Children’s Healthcare of Atlanta.
Children’s Healthcare of Atlanta is a free-standing integrated pediatric health system with three acute care hospitals and a network of alternative care locations managing more than 1.2 million patient visits annually.
To enhance the quality of care, patient experience, and access to specialized pediatric services for children across Georgia and beyond, Children’s recognized the need to build a new hospital on its North Druid Hills campus – just north of downtown Atlanta – and transition from the existing Egleston Children’s Hospital. The Arthur M. Blank Hospital stands 19 stories tall with more than 2 million square feet of hospital space. It features:
- 446 licensed beds
- The state’s only Level 1 pediatric trauma center
- 70,000 square-foot Emergency Department – nearly three times the ED space at Egleston. The ED has 69 emergency exam rooms, including six trauma rooms.
- 55,000 square-foot Radiology Department – more than double the square footage at Egleston.
- 98 patient beds dedicated to children with cancer and blood disorders – 20% of all patient rooms.
- 84 pediatric cardiac beds – 25% more than Egleston.
- 22 operating rooms, including three specially designed cardiovascular operating rooms.
Arthur M. Blank Hospital is the largest healthcare project in the history of Georgia.
Children’s made history on September 29, 2024, when it moved 202 patients from Egleston Hospital to the new Arthur M. Blank Hospital in fewer than 10 hours, culminating one of the largest single-day pediatric hospital moves in the country.
The planning for that momentous achievement started several years earlier. Back in May 2022, Supply Chain under the new leadership of Aravind Sampath, Vice President, Supply Chain was challenged with effectively managing system operations, building the talent needed for transformation efforts across all verticals (Sourcing, Contracting, Value Analysis, Procure 2 Payment, Logistics, Warehousing and Point of Care Inventory Management) and planning/execution of all workstreams for activation of the new hospital campus. It was critical to elevate the role of Supply Chain from a tactical function to strategic asset for the enterprise, and engage with key strategic business partners in order to execute all the complex workstreams for the new hospital which includes:
- Design, build, stock and activate more than 40,000 SKU (Stock Keeping Unit) locations comprising more than 200 supply rooms, 23 operating rooms, cath labs, interventional radiology labs and other ancillary locations. Through the use of RFID and other technologies, the team’s goal was to enhance visibility of the demand signals, automate replenishment process and optimize inventory levels for greater than 99% supply availability.
- Design workflows and deploy the biggest fleet of 90 Aethon Autonomous Mobile Robots (AMR) in a hospital setting to automate and efficiently move supplies, pharmaceuticals, linen, lab specimens, equipment, patient food trays and other use cases. This includes both automated horizontal and vertical movement with dedicated elevators.
- Source and procure medical/non-medical minor equipment and supplies needed to activate the hospital. Effectively maneuver through post-pandemic supply chain challenges including backorders/product shortages, allocations and long lead times for medical equipment.
- Negotiate and execute contracts for more than 100 categories of clinical and non-clinical purchased services. This includes services with various levels of complexity.
- Set-up temporary warehousing and logistics capability to stage equipment, build inventory management solutions and stage supplies needed for activating the new hospital.
- Deploy a Logical/Low Unit of Measure (LUM) distribution framework for effective fulfillment on estimated 1.1 million orders on an annual basis.
- Design and implement an automated inventory management solution using RFID technology and streamlined integrations with Epic and Workday. This includes a two-bin solution in the supply rooms and perpetual/par inventory locations in the procedural areas.
- Execute the logistics involved in relocation from the existing hospital and activation of the new facility on the same day.
- Plan and execute the post go-live stabilization and optimization plan focused on market leading supply chain performance on 99.5+% supply availability.
Designing a hospital supply chain from the ground up
Unlike a renovation or expansion project, the new hospital required strategic sourcing and equipment planning to successfully deploy nearly all-new medical and non-medical equipment. From MRI machines and CT scanners to IV pumps, supply carts, and modular systems, thousands of items had to be contracted, procured, staged, delivered and installed, often amid post-pandemic supply chain constraints. “This wasn’t a one-year effort. It was a multi-year sourcing strategy,” Sampath said. “Our GPO partner, Vizient’s Capital Sourcing solution was an extension of our team and integral in executing our plans.”
Adding to the difficulty was limited physical access to the site. Because it was an active construction zone, Sampath’s team had less than 120 days of on-site access to design, implement and deploy the supply storage systems. That meant relying heavily on blueprints and remote warehouse set-up through partnership with the med-surg distributor (Cardinal Health) to plan for 40,000 SKU locations, spanning clean supply rooms, medication storage, respiratory supply areas, 22 operating rooms, cath labs, interventional radiology, and imaging suites.
“Designing a new point-of-use system and storage based on blueprints, without being able to walk the space, was one of the most complex aspects of the project,” Sampath explained.
One of the most groundbreaking aspects of the project was deploying what Sampath described as “the largest fleet of robots in a hospital setting.” The AMRs were designed and implemented to transport supplies, pharmaceuticals, linen, lab specimens, equipment, patient food trays and other items throughout the massive facility, navigating both horizontal corridors and elevators for vertical movement.
“The robots became an extension of our support operations team,” Sampath said. “We had to design workflows, define use cases, and integrate them into operations/human interactions. In some cases, the robots even accessed patient care areas to deliver pharmaceuticals and food.
“When a shipment arrives at the hospital, it’s already mapped to its final storage cabinet. Our robots then deliver it directly to depots in each unit,” Sampath continued. “That efficiency from reduced touchpoints ensures the team can effectively operate the 14-bay dock and deliver close to 2,500 order lines on a daily basis.”
Beyond equipment and supply systems, Sampath’s team also had to renegotiate and launch contracts for all clinical and non-clinical purchased service services, including food and nutrition services, virtual and on-site interpretation, laundry and linen, waste management, landscaping, equipment service contracts, shredding, and several other services. The larger footprint and new infrastructure meant the majority of existing agreements no longer fit the scope.
“Every contract had to be reexamined and often rewritten,” Sampath said. “It wasn’t just the physical supply chain. It was every support service needed to operate a hospital of this scale.”
On top of that, the team implemented new supply chain technologies, including Workday as the ERP backbone, Tecsys RFID enabled point-of-use inventory management, and integrated with Epic clinical workflows in the procedural areas. Ensuring those systems worked seamlessly at go-live required exhaustive testing under tight deadlines.
For Sampath, the work demanded both technical expertise and a mindset comfortable with uncertainty.
“You have to be comfortable with quickly solving complex problems and finding optimal solutions based on project constraints,” he said. “You don’t have the luxury of a 12-month assessment plan. You have less than two years, and the train is already moving.”
He pointed to the hospital’s point-of-use inventory system as an example. Post Go-Live, par-levels and supply availability weren’t meeting expectations, forcing the team to rapidly optimize their two-bin replenishment process. By deploying operational excellence resources and acting quickly, they achieved 99.8% supply availability within four months.
“It was humbling,” Sampath admitted. “That’s where having the right people, supply chain expertise and team members with a continuous improvement mindset and data skills paid off. They didn’t just patch problems; they redesigned and optimized processes for the long term.”
Mission-driven supply chain
The scale of the new hospital is only part of the story. Children’s has a mission to “make kids better today and healthier tomorrow,” and Sampath said that mission fundamentally shaped the way his team approached supply chain.
“This was my first time working for a free-standing pediatric health system,” he said. “It was refreshing to see how the mission and vision translated into daily decision making and operations”. The team balanced transformation across every functional vertical of Supply Chain while also executing the plan for the new hospital campus. “It was a bold, complex plan, but the system mission and vision made alignment easy.”
Historically, Supply Chain has often been viewed as a transactional function. At Children’s, Sampath has worked to elevate it into a strategic asset for the enterprise.
“It starts with having a line of sight to system goals and being at the table for strategic conversations,” he explained. “Supply Chain cannot just be an order taker. Once we understand the organization’s priorities, we can build a strategic plan that aligns sourcing, contracting, procurement, logistics, and technology investments with those goals.”
Operating in pediatrics adds unique complexity. The Supply Chain must serve patients ranging from 500 grams to 500 pounds, with product variation far exceeding most adult health systems.
“The pediatric supply chain is fragile,” Sampath said. “There are fewer suppliers producing the sizes and products we need, and the cost of goods sold can be higher. That’s why a robust value analysis framework with strong clinician / physician collaboration, both internally and with other health systems through Vizient facilitated Pediatric Alliance aggregation group, is so critical.”
He credits the Children’s Hospital Association for enabling peer-to-peer dialogue on both products and processes. “We share best practices through data driven benchmarks, we execute aggregate sourcing strategies, and we even advocate together with suppliers,” Sampath said. “In pediatrics, no one system has all the leverage. Collaboration is our leverage.”
Transformation also required talent. Since 2022, Sampath has rebuilt his leadership team, recruiting external talent from healthcare and other industries, while blending them with the experience of long-tenured Children’s staff.
“While building a new Supply Chain organization and executing complex prioritizes, I was very glad to see double digit increase in employee engagement.” Bringing in new talent elevated collaboration and performance.”
In order to build a high performing team focused on continuous improvement, he also created a supply chain optimization team comprised of Lean/Six-Sigma operational excellence specialists, system engineers, analytics and project management resources. Their mandate: continuously improve systems, processes, and outcomes across all verticals of Supply Chain.
Looking ahead
Resiliency has become a three-pronged strategy at Children’s: maximizing self-distribution, leveraging low-unit-of-measure distribution with its primary distributor, and tapping into third-party logistics capacity. The result: Increased supplies managed through distribution by 80+% and improved fill rates from the mid-80s to above 99.5%. “The complexity is in having real-time visibility across all three channels, automating order replenishment and effectively manage the inventory turns to minimize any shrinkage,” Sampath said.
As he looks five years ahead, Sampath sees both opportunities and risks.
“Bending the cost curve is critical. Inflation, tariffs, and declining reimbursements mean we must adopt multi-pronged strategies, not just pricing tactics,” he said. “We also need to keep investing in talent logistics capabilities, category management, and technologies like AI that can help us be more efficient. And resiliency will remain key.”
Looking back, Sampath admits the past couple of years managing supply chain pandemic response for a IDN in Southern California and leading Supply Chain transformation efforts at Children’s have been some of the most challenging of his career, but also the most rewarding. There was a need to be strategic and at the same time be comfortable in rolling up one’s sleeves in active execution of the plan.
“We were building the plane while flying it,” he said. “But what stands out is the resilience of the team. They managed daily operations while executing one of the most complex supply chain transformations in healthcare. That’s no small feat.”
For Children’s, the successful move wasn’t just a logistical victory. It was the foundation for a new era of pediatric care, supported by a supply chain designed for scale, adaptability, and innovation.