Sunday, October 6, 2013

Pharmaceutical manufacturers Look to Modified Lean Approach to Reduce Waste

As it's mentioned in Manufacturing Resource Productivity (McKinsey Quarterly, June 2012), most manufacturers use lean manufacturing to improve resource productivity and reduce consumption of energy and raw materials. As many other industries, drug manufacturing also looks for more efficient operations to reduce wastes during manufacturing.
The current wastes in drug manufacturing industry is estimated to be $50 billion per year. In order to minimize this number, pharmaceutical manufacturers try to implement traditional lean manufacturing practices to improve their operations. However, it is not suitable for pharma industry since its production environment is complex, highly variable, shared-asset. Thus a modified lean practice is necessary for pharma industry. Optimization software and methodologies are used to deal with the high variability. The modified lean practice uses flow-path management to define value streams and organizational structure more flexible. It also calculates inventory and manages capacity planning and lot sizing in different methods.
With this modified lean practice, pharma manufacturers are able to integrate operations and have a better control over the key performance indicators. They could make decisions according to product flow through the factory instead of metrics of each department. Real-time data is available for all business systems. Production performance is then visible and better planned, which can reduce cycle times up to 80% and reduce inventory to save cost and improve bottom line. Also, with the help of simulation and analytics software, pharma manufacturers are able to figure out the best practice and scenario to reduce waste and improve bottom line.
Question for readers to think about:
What characteristics of pharma manufacturing industry are different from other industry and make reducing waste so difficult?


1 comment:

  1. Nice Post !!!
    I truly like to reading your post.
    Post is very informative and all the points are very easy to understand. ERP software is must needed for our buisnes.
    Eresource provides web-based ERP solution for all pharmaceutical industries like manufacturers of vitamins, natural health.
    ERP software for pharmaceutical manufacturing companies reduces operational costs and saves time.
    Thanks for sharing such a nice post...


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