LIFE SCIENCE SUPPLY CHAIN SOLUTIONS BY STEVE CLARKE
For all those managers and future managers out there, your suggestions on how to improve performance must be based upon data, or you will fail. At one client that was challenged with low on-time shipment performance, I was asked to help them solve the issue. The goal was to improve from <70% to 95% on-time within one quarter. We did all the right things – formed a team, analyzed late order data and proposed solutions, with the following conclusions:
Top 4 Challenges
● Labor capacity shortage at one of the work centers● Customer order promise date management issues● No visibility to expiring batches● Immature new production introduction (NPI) processes
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Solutions
Each of these issues were within our control and could be addressed relatively quickly, as follows:
- The hiring process for the capacity constrained work center was expedited.
- Several meetings with order management leadership team to reiterate guidelines and put controls in place to identify errors if they occurred.
- An inventory audit held, including all lot-controlled items with expiration dates. These dates were entered into the ERP system, and a report identified to proactively identify short-dated materials.
- A cross-functional team mapped out the NPI process, identified pain-points, developed, and implemented solutions.
The team was very confident that these actions would enable us to meet our goal. However, at the same time, one of the senior managers suggested that the solution should be to install large monitors on the production floor to show customer orders by due date to increase visibility of the order backlog. This may not be a bad idea, but there was absolutely no evidence that this would help us meet the objective. All it would do is distract us from the important work that was required. Fortunately, one of the other senior leaders managed to delay the “Monitor” project until we had completed our initiatives.
Another example was a client that had an overflowing warehouse. They jumped immediately to purchase an expensive Vertical Lift Module (VLM), which is a carousel that can store thousands of small parts. When a part is needed, you enter the part number, and the carousel will rotate and stop to give you the part you required. You can see that this is a cool, “sexy” piece of equipment.
However, they had failed to investigate the warehouse layout. What we found was that the current pallet storage capacity in the racks could be increased from about 50 to 150 pallet spaces immediately. The expense was a fraction of the VLM, much less complicated and quicker to install. This does not mean that a VLM was a bad idea, it just means it was a good idea, at the wrong time.
This is not unusual; I have frequently had to fight off senior management who were promoting a pet project for which there was no direct evidence that it would “move the needle”. Most projects can be justified from an ROI perspective, but seldom have I seen a requirement to see the root cause analysis data before a project is approved.
Why don’t you take the road less traveled? The one that will lead to success!
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