Supply chain management in medical device industry is one of the key pillars for efficient Manufacturing. A robust supply chain minimizes the disruption to the manufacturing cycle in case of an unforeseen adversity.
During COVID-19 most Medical Device manufacturing companies faced many hurdles including component shortages, price hikes, new technology demand and excessive pressure to keep quality intact with limited resources. Several major hurdles are briefly discussed below:
- The excessive market demand of COVID related healthcare devices in diagnostics, hospital essentials (PPE, Ventilators etc) and various other COVID oriented Medical Devices impacted the overall medical device manufacturing. The focus on in- demand products affected the production and manufacturing of OTC and Medical Devices of other segments. The shortage of semiconductors, Collibri (T-20 & VF-50), SMPS Transformer parts and Sheet metal parts due to scarcity of O2 & N2 affected overall electronic medical device manufacturing landscape. The resources went out of stock even before the existing market demand was fulfilled.
- The worldwide extended lockdowns and scarcity of resources led the majority of workforce to relocate. The manufacturing companies found it difficult to retain the workforce due to uncertain workflow.
- Transportation delays due to frequent border seal affected material/product reach to the required zones. The shipments took much longer than usual, the duration of the deliveries increased manifolds.
In tough times the manufacturers could finally sense the challenges for which they were not ready. During this time, many loopholes surfaced and resolving them many learnings came along the way. The situation brought forth critical supply chain considerations which a Medical Device Company needs to evaluate before hiring a contract manufacturer.
Let us look at 5 key parameters on which you should evaluate your contract manufacturer’s ability to successfully manage supply chain in general and even in times of crisis.
1. Pre-planning & Inventory Management
A contract manufacturer must pre-plan the requirements as per the BOM. Negotiating, verifying, and finally approving an authorized vendor or supplier involves a very long time. Ideally, Contract Manufacturers must do advanced inventory planning to manage optimum stock levels of raw materials. A planned & real time track of medical device warehousing eliminates last minute hassle and delay.
2. Managing obsolescence of components
Each component in medical device manufacturing has a status classification. Engineers and designers in a medical device manufacturing facility must verify and validate the component status before putting them into the design. Often unavailability of components at the later stage leads to a longer production cycle. The components are classified as under:
NRND (Not recommended for New Designs)
The component status NRND means that the part isn’t fit to be incorporated in the new design. The component marked as NRND will experience low demand in near future & it might be difficult to procure in near future. The use of NRND components must be avoided in the new designs.
OBS (Obsolete components)
The component status OBS means that the component is obsolete and therefore it needs a quick replacement. An easily available economical alternative must be used instead of parts marked as OBS.
3. Supply Chain Transparency
Communication is the key to avoid delays and keep everything running smoothly. Any change in vendor, cost, or material must be communicated efficiently to the client. Both the contract manufacturer and the client must keep track at all levels. Miscommunication or latent details can create conflicts for both the parties. Every minor detail from the initial stage to the post-production supply chain stage must be shared with complete transparency.
4. Vendor/logistics Network
An experienced contract manufacturer should have a global Vendor Network to enable a continuous quality supply chain of components. A strong vendor network ensures timely delivery of components at reasonable costs. In tough times when supply chain is irregular and uncertain, a strong vendor network reduces the challenges in your journey to move your product to market.
5. Strict Compliance with Regulatory norms
A contract manufacturer must comply with the geography-specific regulatory norms concerning processes and products. This ensures safe and fast delivery of raw materials/products and avoids any unnecessary delays specially in times of crisis.
Conclusively, an experienced contract manufacturer with established and efficient supply chain network can help you scale production and reduce your time to market even in times of crisis.
Johari’s efficient pre-planned, efficient supply chain management ensures quality manufacturing and delivery at an optimized cost. We make sure that our system and processes are strategically planned and adaptable to withstand adversities.