November 01, 2022

Traditional healthcare manufacturer evolves into a data-driven powerhouse

Nasco Healthcare is a global leader in manufacturing for medical simulation. For over 80 years, their products have helped frontline healthcare workers save and improve lives.

In 2020, Nasco CEO Ken Miller noticed that messy data and outdated techniques were interfering with the accuracy of foundational company-wide initiatives. The stakes were high—Nasco handles millions of dollars of open orders on any given day.

Miller teamed up with Stratus Data to upgrade Nasco to a data-driven organization. The partnership, he says, has “transformed the performance and future of our company.”




Initially, Nasco grappled with their data and business in a few notable ways:

  • Skewed product mix. Only 120 of 8,000+ SKUs made up the top 50% of revenue.
  • Messy data. For much of its history, Nasco was a family-run business, with limited investment in tools, systems, and processes. Employees entered and edited data without a standard procedure.
  • Overlapping databases. After a merger, different sites continued to operate independently, with separate portfolios. Duplicate SKUs occurred across portfolios, but were named inconsistently, and difficult to detect.
  • Manual reporting. Sales reporting was done ad-hoc and manually, with limited visibility into what was sold, to who, and when.

Miller interviewed 4-5 Data Science teams. “I gravitated to Stratus,” he says, “because they’re as smart as a whip. I was incredibly impressed by their understanding of data. And they were quick learners.”


Project 1: Portfolio cleanup & SKU rationalization

Automated product-naming system enables CEO to fully analyze full product line

Miller was trying to make plans for the next year. But he found that any truthful analysis of his portfolio was obscured by thousands of dead SKUs. Out of 8,000 products, only a handful were really earning money. How could he determine which to cut?

At this time, Miller had just hired Stratus Data. Founding Partner Charles Pensig stepped in to work 1:1 with Miller. They started by naming the highest earning 50% of products using Group and Family. They expanded to 80%, and then 100%. Pensig describes, at each phase, “melding what was in Miller’s head to mine, and then melding mine to a computer.”

Miller came away with a computerized system for naming products. It provided the necessary organization for him to cut 4,000 SKUs out of his portfolio, enabling an increase in growth margin profile.


Project 2: Automated sales dashboards and reports

Dashboards unlock company-wide data transparency, setting off significant year-over-year growth

The success of the first project gave Stratus Data credibility across Nasco’s stakeholders. “I turned Stratus loose,” says Miller, “and since then, they’ve become like part of our own team.”

Clean, organized data opened the doors to the world of data-driven competition. The immediate opportunity: automated reports and sales dashboards for the C-Suite and Sales Team. Equipped with these tools, Nasco employees could make educated suggestions based on customers’ past behavior, as well as the behavior of regional peers.

Automation saw two consecutive years of significant revenue growth for Nasco. Even before these numbers came out, internal engagement soared. The Sales Team could visualize performance real-time. What are customers waiting on? What can we provide to support them better? What does this mean for my own paycheck? Teammates were newly excited about their work. “These are results you can’t put a number on,” says Miller.

“They stayed committed, kept me engaged, and sent me updates that gave me more ideas of what I could do with the power of my data. There’s no price you can put on competency.”
– Ken Miller, CEO, Nasco Healthcare

Project 3: Demand forecasting

Machine learning identifies hidden revenue opportunity in classic Moneyball example

Nasco’s team were already experts with strong intuition about the industry and market, with decades of experience predicting demand. But they also faced the data biases and technical limitations shared by all humans—no one can singlehandedly analyze 100Ks of datapoints, barely even Excel.

Stratus Data worked closely with Nasco’s team to understand the context, data, and use cases of product demand. They fed years of data into a simple, elegant Machine Learning algorithm which forecasted demand, 18 months ahead, by region, for all SKUs.

That year, the algorithm’s prediction exceeded Nasco’s human predictions by 3.5x. Miller took the risk and greenlit the extra production. His bet paid off. Orders spiked, and Nasco was able to capture all the unprecedented additional revenue. The algorithm’s prediction was correct within 2%.

Today, minds and machines meet. Nasco’s experts have seen the advantages of integrating the algorithm into their month-to-month workflows, augmenting human intuition with machine power.


The New Nasco

Nasco grows stronger and more competitive every year. The company is now built upon a living, self-updating data system which informs key conversations with numbers: What should I make? How much? For who? Leadership sits back and watches how decisions impact the company real-time. The Sales Team is inspired by state-of-the-art machinery. Supply Chain and Manufacturing Teams have a new barometer to advise their monthly multimillion-dollar production decisions.

“That’s the power of the data,” says Miller. “It’s beautiful.”

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