Challenge

From my experience, life science business processes are more bureaucratic and inefficient than most industries, primarily due to all the regulations.

​Since supply chain performance is so dependent upon robust business processes, in many cases, this inefficiency creates mediocre performance.

Solution

By following 7 simple process redesign principles, you can literally transform how work gets done in your organization.

Here are 4 principles I have found in life science supply chain transformations:

1.  When? Is the step performed at the right time?
2.  What data? Is the right data utilized to support the step?
3.  Which? Is there an opportunity to not perform the step under certain circumstances 4. Where? Does it make more sense to perform the step somewhere else?

By asking these questions for every step in the process, the team will find lots of opportunities for process improvements and consequently better supply chain performance.

Results

Here are some real-life examples of how we used each of these four principles at a medical device manufacturer:

When?: Customer orders that were well above forecast were not flagged until the order had already shipped (“the When”), which was too late to prevent disruption to their supply chain. Instead, the process was changed to flag these orders immediately to give time for supply chain and commercial to react, which dramatically improved on- time shipment performance.

What data?: The warehouse was overflowing and they had budgeted for a $2MM warehouse. However, we leveraged space utilization data and inventory months on- hand data (“What data”) to show that only about 60% of racking space was utilized and many bulky items had excess inventory. Once these issues were addressed it was clear that a new warehouse was not required.

Which?: The supplier quality program treated every vendor the same, whether they supplied cardboard boxes or complex instruments. We redesigned the process to differentiate suppliers by risk profile (“the Which”). Those with the most risk had periodic audits, had regular business reviews with a scorecard for each one, whereas those with low risk were given far less attention.

Where?: Buyers were placing orders for bulky cardboard boxes, based upon MRP, which was often inaccurate, so they ended up with pallets of excess materials, which was problematic for a small warehouse. We transferred the responsibility of requesting delivery from the supplier for certain items like cardboard boxes, to the material handlers, in the warehouse (“the Where”). This made more sense since they could see the ACTUAL inventory levels and not inaccurate MRP messages. Some items very

quickly dropped from 60 days on hand to less than a week.