To stem losses the hospital rolled out an inventory tracking system that holds pictures of the hospital's 28,000 surgical instruments on a database.
The hospital is now able to use images to prove exactly what surgical instrument trays should contain before an operation begins.
This complements the use of digitally etched barcodes on instruments the teaching hospital uses to ensure staff can confirm whether instruments have been used and sterilized, and where they are in the hospital's "supply chain".
Graham King, nursing unit manager of sterilizing services at Westmead, said once the system went live at the end of last year, errors on surgical instrument trays diminished completely.
King said the hospital went searching for the tracking system when the owner of the previously used tracking system refused to commercially release its IP.
"In 1996 the hospital started doing instrument tracking with another company (SIIS) and got stuck with the Microsoft NT 3.5 platform and there was no one around to migrate the data," King said.
"With Surgidat we had to purchase some XP touchscreens as it is much easier than using a mouse while using a hand scanner to read instrument barcodes, and we relocated a server so if parts of the network go down we can still track surgical instruments.
"We started the initial tender in June 2005 and the system was completed and implemented in October and all the database listings were transferable and at that stage Surgidat was the only company that could show us an actual barcode scanner in action, because all the other companies that applied to the tender were still developing one."
Initially 12 vendors replied to the tender and Surgidat won because of access to the scanner.
The value of the tracking system according to King is when instruments are collated on surgical trays needed for surgery.
"At the moment we are only using the tracking system for our nine theatres and we have two workstations; only sterilizing services have access to the system at this stage," he said.
Without the tracking system, King said five more staff would be needed.
"But with inventory tracking, the computer acts as the check so one person can assemble a set of instruments for an operation, without a second person required to do the checking."