The New System Blueprint
Before embarking on a Lean program, pharma companies must take to heart a critical lesson from Toyota: Start with a clearly
defined business system, including distinct customer segments and their needs, processes for sourcing, developing, producing,
marketing, and delivering products, and a well-designed support organization. Designing the blueprint for this system is the
responsibility of senior management, not front-line employees. Once this system is in place, Lean programs can optimize it;
without it, the full potential of Lean programs will never be realized.
Case Study: Clinical Supplies MANAGEMENT
|
Although the industry has made progress in shaking free from last century's blockbuster business model, most companies are
still struggling to define themselves in new, more rational terms. Unlike Toyota, which was operating within a sharply defined
framework, the global drug industry is fast-changing and far-flung—and only growing more so with new customer segments, new
markets in emerging economies (such as China, India, and Eastern Europe), differing regulatory requirements, customer needs,
and market potential. This daunting complexity can lead to Lean programs that are poorly targeted and deliver little strategic
impact.
Before applying Lean techniques, senior management should ask whether a function or activity should exist at all. Does it
have value to the customer? Is it on a critical path? Projects that aren't aligned with customer needs or business strategy
may eliminate waste or improve cycle times, but the lasting effects will be minimal. For instance, if the goal is to speed
up product development, reducing the cycle time of certain toxicology studies won't make much of an impact. Nor will improving
operations at a manufacturing plant that's about to lose patent protection on its major products. If capacity utilization
is poor, overhead costs are high, cycle times are long, and factor costs are misaligned, the first step should be to analyze
whether it would even be possible to match competitors' pricing after patent expiry and a likely loss of volume. And if the
answer is no, the right decision might be to make structural changes such as outsourcing or off-shoring production—not launching
an intensive Lean effort.
Lean can also transform critical "systems" such as product development. By looking at the end-to-end process and fundamentally
rethinking everything from funds allocation to new product introduction, pharma companies can drive major improvements in
cost, cycle time, and quality. It took GSK-Bio's one-roof vaccine-development experiment only two or three years to prove
its value.
|
PharmExec Blog
Follow Us
RSS
Bookstore
