Prescribing a Dose of Lean Logic

In this article, you'll learn about ...

The process of implementing lean principles
Lean initiatives taking place in the medical device industry

Over the last decade, lean manufacturing has been prescribed as a cure-all in a wide variety of industries. Most success stories have centered around the automotive and consumer goods industries. Medical device manufacturers have been slower to adopt lean principles.

While some companies, such as DJO LLC and Medtronic Inc., have been recognized for their lean initiatives with the prestigious Shingo Prize, many other firms are far behind. Traditionally, because of high profit margins, there’s been less incentive for manufacturers of syringes, cannulas, pacemakers and other products to go lean.

“The medical device industry is still fairly early in its lean journey compared with other industries,” says Art Smalley, president of the Art of Lean Inc. and a former Toyota Motor Corp. engineer. “Some of the price-cost squeeze that has long been going on in other industries is now affecting medical device manufacturers.

“Whenever there starts to be increased pressure and competition in any industry, lean starts to draw attention,” adds Smalley. “Companies that felt pressure earlier [typically] started their lean journey sooner.”

Some medical device manufacturers are protected by patents or boast strong profit margins that insulate them from the need to pursue lean initiatives. “However, as competition heightens and margins come under pressure, or customers simply demand more, then attitudes will change,” predicts Smalley, who has worked with a handful of medical device manufacturers.

“Up until five years ago, many medical device manufacturers were not motivated to change [their production practices],” notes Drew Locher, managing director of Change Management Associates. “Sometimes, they would ‘hide’ behind regula-tions as a reason why change could not happen.”

“The intense regulatory environment that surrounds the medical device industry is usually perceived to be a limitation to going lean,” adds Jamie Flinchbaugh, a

“The intense regulatory environment that surrounds the medical device industry is usually perceived to be a limitation to going lean."

partner in the Lean Learning Center. “In fact, it’s often used as an excuse. However, other industries that have successfully adopted lean manufacturing also have to deal with barriers, constraints and limitations, such as union contracts and volatile raw material supplies.”

According to Matt Zayko, an associate at the Lean Transformations Group, the medical device industry is about 15 years behind the automotive industry on its lean journey. “Medical device manufacturers have not moved as fast as they could have with regard to lean improvement,” he claims. “Instead, some manufacturers have chased low-tax, offshore locations for final assembly.

“This strategy [has often caused] the added expense of inflated lead times, slower delivery and delayed quality feedback,” Zayko points out. “When you look at the end-to-end value stream from suppliers to end users, there is [too] much waste from non-value-added actions in this industry.”

Instead of asking “How can we take cost out to make more profit?” Zayko says a better question for medical engineers would be to ask “How do I provide more value (and flow this value) to the customer, while also reducing true total cost?” Another challenge is to think creatively about how to solve problems without first resorting to spending money, through creativity-before-capital initiatives.

By following in the wake of lean pioneers in other industries, medical device manufacturers should encounter a quicker learning curve when it comes to implementing 5S, jidoka, kaizen, kanban, poka yoke and other lean principles on the plant floor. In fact, many former automotive professionals are now firmly entrenched within medical device companies and healthcare organizations, which should help the industry ramp up lean models and quickly develop a legion of lean thinkers.

“There are a handful of progressive medical device companies [out there] that are seriously embedding lean into their thinking and acting,” claims Zayko. “One [market] is implantable devices and another is diagnostic equipment.”

Two areas where medical device manufacturers could benefit the most by implementing lean principles are product development and first-time quality. “When they launch production systems for new products, [there is tremendous] opportunity to work on doing lean process design upfront within the development cycle,” says Zayko. “[This can] avoid costly engineering rework post-launch, since revalidation costs have skyrocketed during the past decade.”

Several unique aspects of the medical device business make implementing lean principles more of a challenge than in other industries:

Misinterpretation or overinterpretation of regulatory requirements, which leads to overly complex and inflexible quality sys-tems.
Designing new production systems or assembly lines late in the development cycle with no opportunity to improve upon les-sons learned from doing kaizen on current operations.
Long, complex supply chains that demonstrate the “wave effect” phenomenon.
A disconnect between development and operations that leads to poorly performing operational value streams.

Implementing lean manufacturing can be more challenging in some medical device segments than others because of different production volumes. “It is easier to apply ‘copycat lean’ when there are higher volumes and fewer types of products,” notes Smalley. “This makes it easier to adopt the principles of dedicating products to consistent flow paths, establishing takt time, pull systems, and leveling and standardizing work practices to takt time.”

When volumes are lower, a large number of variants exist and production equipment is shared. That requires more thinking about first principles and how to achieve them.

“The low-volume, high-mix component of production makes it relatively harder to schedule production, since there are more changes to plan for, and to standardize work practices, since there are more types to plan for,” explains Smalley. “The need is no different. The implementation just becomes relatively more challenging.

“[For instance], the basic steps and questions of kaizen don’t change per se if you stick to first principles, such as ‘How do I build in quality at the source and not inspect it in?’” Smalley points out. “However, the solution space may take different shapes.”

For high-volume, low-mix medical devices, such as disposable syringes, engineers should focus on uptime and minimizing all motions, since they may take up a large percentage of takt time or planned cycle time. “These situations are usually more capital-intensive with less manual work required, so there needs to be emphasis on total preventive maintenance, quick changeover, low scrap and high first-time quality,” says Zayko. “Part sizes tend to be smaller, so any manual workstations need to have components delivered as close as possible to point-of-use to minimize all variability.”

Low-volume, high-mix medical devices, such as diagnostic equipment, typically require more manual assembly. “The focus should be on creating smooth, balanced [workcells] using a target cycle time based on takt time,” explains Zayko. “Since this requires people to work long cycle times per part, it is important to create simple, well-organized workstations that support standard work, error proofing and fast learning curves.

“[Assemblers] will probably have to work multiple stations as they move the part, so this requires simple part handling devices or methods and a strong awareness of ergonomics,” adds Zayko. “In both cases, you need to start by asking, ‘What is the work required to make one part?’ Then, from there, medical engineers should think about a few options and then design a process that best supports doing this at high first-time quality, short lead time and lowest cost.”