How LSS Can Improve Supply Chain Processes in the Pharmaceutical Industry

Process improvement has already brought about a revolution in the way companies approach management of their operations. Now, it has become an indispensable part of the development of any effective supply chain. There are several tactics, methodologies and tools that have been developed to help organizations improve their processes in order to gain a competitive edge.

Lean Six Sigma (LSS) is a combination two methodologies, Lean and Six Sigma, that has seen incredible success in the improvement of production processes. The singular focus of lean is the eradication of waste of any kind while Six Sigma is dedicated to eliminating any defects through the reduction of variance; this combination makes LSS an incredibly powerful process improvement tool.

For this reason, a growing number of companies in the pharmaceutical industry are turning to Lean Six Sigma to stop waste and eliminate variance within their supply chains in the following ways:

Reducing Fulfillment Time for Orders

Besides the tracking and reporting required by the law, there are many pharmaceuticals that are sensitive to temperature, thus introducing considerable warehousing problems. When added to logistical concerns and the usual complexities of shipping, pharmaceutical order fulfillment is among the most complicated delivery operations that any company can face.

Still, the use of LSS to examine the order fulfillment system will help project teams to identify areas where there is a lot of waste or a high degree of variance. When they have been identified, the order fulfillment process can then be fixed through reduction of paperwork, automated pickup and shipping plans, as well as digital, automated verification of shipments.

Creating a Responsive Supply Chain

Pharmaceutical requirements are fluid and epidemics, disasters and other occurrences can have a drastic effect. For this reason, the company’s supply chain needs to be agile, dynamic and be able to respond quickly to changes in the needs of the customer. If a pharmaceutical company is attuned to these requirements, then it will have taken the crucial first step to create a supply chain that is able to respond to the customer’s requirements. Six Sigma’s define phase helps to do this, as it requires the company to measure progress made on the basis of what the customer considers to be Critical to Quality (CTQ).

Reduction and Elimination of Errors

The Lean technique known as Poka-Yoke can be of great benefit to inefficient supply chains with high rates of error. Poka-Yoke is a mistake-proofing tool which helps to eliminate human error by forcing users to complete their tasks correctly. In addition, the lean principle of 5S (Sort out, Set in order, Shine, Standardize and Sustain) also helps to reduce errors through elimination of waste. Adherence to 5S creates a clean, uncluttered and safe work environment, where workers are less prone to making mistakes.

Optimization of Order Fulfillment

An order is considered filled to completion if it arrives on time, complete with accurate documentation, and without any delivery damage. For life essential and time critical products such as pharmaceuticals, order fulfillment has to be done just right. Six Sigma optimizes order fulfillment by helping to identify problems within the supply chain such as inefficient execution or outdated planning practices.

Reducing Waste

As explained earlier, the purpose of lean is the elimination of waste, which is any activity that adds little or no value to the product. Some of the wastes that lean targets include unnecessary processing, such as excess packaging of pharmaceuticals, or unnecessary transportation, which burdens the company’s logistics infrastructure. By devising an efficient supply chain, the company increases its revenues, lowers costs and gains a competitive advantage.

Conclusion

Lean and Six Sigma have been proven to be effective in reducing waste and eliminating errors while improving product quality. When implemented, the strategies and tactics of Lean Six Sigma can be applied in a number of ways that include application of real time data for improved inventory management and establishment of quantifiable standards for every step on the pharmaceutical supply chain.